I’m Sorry — But Hey I Didn’t Do Anything Wrong

The WSJ reported today that John Mackey, CEO of Whole Foods is back online with a vengeance. He was cleared by the SEC of any wrongdoing relating to anonymous postings on Yahoo Finance message boards. Mackey had attracted media attention by posting critical comments about the rival food chain Wild Oats under the screen name “rahodeb.” Story here — registration may be required:

http://online.wsj.com/article/SB121190074263322887.html?mod=todays_us_marketplace

Mackey also wrote a long post on the Whole Foods web site giving his side of the story to the whole affair. It’s a detailed and well thought out explanation:

http://wholefoodsmarket.com/socialmedia/jmackey/2008/05/21/back-to-blogging/

I believe you need to clearly self-identify when posting/commenting/interacting online, and that’s the counsel I give my clients. But I tried to read the post with an open mind. Honestly, I’d love it if more of my clients took blogging and online content as seriously as Mackey clearly does.

As a disclaimer, my wife and I enjoy shopping at Whole Foods — the seafood is really good. All that said, his explanation left me feeling ambivalent.

Mackey admits to poor judgment in the post, but nothing unethical. His post is persuasive, but he wants it both ways. He didn’t do anything wrong, but he’s sorry anyway. He says he’s very competitive, anonymity was the custom on message boards, all the information was publicly available, and he was just exercising his free speech rights. OK, well then why apologize? You’ve been cleared, right? Pick a position and stick to it.

Two of his points were not persuasive to me at all. One was his opinion that an anonymous poster has no real influence, so how could he have been trying to injure Wild Oats?

It was infuriating to be accused of trying to manipulate Wild Oats’ stock price downward so that Whole Foods Market could buy it more cheaply. This is malicious speculation and an accusation with no basis in fact. My last Yahoo! post occurred in August 2006, and Whole Foods Market did not begin talking to Wild Oats about a buyout until January 2007—a five-month gap. In addition, almost all of my posts that were critical of Wild Oats were made when its stock was far lower than the $18.50 per share Whole Foods Market paid for it. When I posted as rahodeb, was I trying to “hurt Wild Oats financially or otherwise?” Of course not! The question assumes that someone named rahodeb posting on an online message board could actually hurt Wild Oats if he wanted to. How could rahodeb possibly hurt Wild Oats on a digital message board? The answer is obvious: rahodeb couldn’t.

But if we stay with that logic, why participate on the Message Board at all? Earlier in the post he said he started particpating to defend Whole Foods from criticism. Why bother, if those criticisms were harmless? Most CEOs I know don’t look to waste their time. And ask any Investor Relations person if messages on Yahoo Finance are always harmless. Investing isn’t purely rational — people can be swayed by these conversations.

The second point was not realizing he had become a “public figure:”

Perhaps part of the problem here is that when I first started participating in these Yahoo! online communities back in 1998, Whole Foods Market was only 15 percent as large as we are today. We had yet to open any stores in New York City and we weren’t taken particularly seriously by most of our competitors or the media. Whole Foods Market’s tremendous growth over the past 10 years hadn’t yet occurred. As the CEO of Whole Foods Market I was seldom interviewed and few people knew or cared who I was. I wasn’t a public figure and had no desire to become one. However, as Whole Foods Market continued to grow and as we opened large and exciting new stores around the United States, both the company and I became better and better known. At some point in the past 10 years I went from being a relatively unknown person to becoming a public figure. I regret not having the wisdom to recognize this fact until very recently.

Come on now. You don’t have to lead a huge company to realize that the personal and professional merge. And there’s something called Director’s and Officer’s (D&O) insurance I’m sure he had, which makes explicit the link between professional activity and personal accountability.

Do I think the media ran with this in part due to its unique nature and easy plot line? Sure I do. I’m also willing to grant that back in 1998 there were far fewer ways to engage in online communities than there are today. (But by 2006, there were plenty)

Mackey’s post is a more erudite than usual version of something too common today — the “I’m very sorry if what I did upset you” statement. It tries to give the appearance of apology, without really accepting responsibility.