After making many concessions to the extreme right of the Republican Party, California Republican Congressman Kevin McCarthy finally ended the difficult election process on January 7 this year and was elected Speaker of the House of Representatives. Although McCarthy was ultimately elected, his ascension to the House of Representatives weakened his authority, reduced his power, and emboldened ultraconservatives in the Republican Party. Risk of political incapacity and chaos.
Before McCarthy was elected, he agreed to many demands of Republican hardliners, including changing the rules of procedure to allow a single congressman to initiate a vote to remove the speaker, and allowing caucus members to serve on the House Rules Committee (House Rules Committee). Everything McCarthy did to appease a small (but loud) part of the party drew concern and criticism from others in the party. An anonymous Republican senator told the website The Hill: “The normal functioning of the House of Representatives requires the authority of the speaker, but the many concessions made by McCarthy show that whoever is the next speaker will no longer have the authority to run the House of Representatives.”
While the U.S. House of Representatives has experienced an unprecedented deadlock, making this election the longest for a speaker in more than 160 years, such conflicts are not uncommon in the corporate world. Disney’s top-level changes, for example, lead to the ouster of Bob Chapek in November 2022: After a series of missteps, including the company’s response to the outbreak, reluctance to oppose Florida’s so-called “Don’t Say Gay” (Don’t Say Gay) ’t Say Gay Act, billions of dollars lost to the streaming business and growing tensions with other executives and board members, the former CEO was replaced by his predecessor, Bob Iger. Allegedly, the trigger for his departure was Disney’s chief financial officer, Christina McCarthy. She warned board members that the company had gone off track under Chapek.
While workplace conflict at the leadership level is inevitable, it can be valuable when executives can openly debate, communicate, and agree to disagree to drive company performance. But executives are often at odds, and this unhealthy relationship can lead to lost productivity, stalled business, and confusion that can affect the entire company. Chapek’s reluctance to speak out against Florida laws restricting discussion of gender and sexual orientation in elementary schools has sparked employee walkouts and anger from current and former executives, leaving his subordinates to work to reassure employees. However, for McCarthy, the House of Representatives cannot function normally until a speaker is elected, and he may face many challenges in terms of government funding, raising the debt ceiling and opposing ESG disclosure rules and investment requirements.
Dick Barton, a partner at executive search firm Egon Zehnder and co-head of its CEO practice, told Fortune: “The key to being a CEO is not making a million decisions, but helping other people make them. “As corporate governance shifts from shareholder-first to a broader ecosystem of stakeholders, CEOs must communicate effectively with many stakeholders, including their subordinates. In the political arena, it quickly became clear that McCarthy had not communicated with disgruntled Republican lawmakers ahead of time, forcing him to rush into negotiations on the concessions he needed to make during the speaker election. And those concessions, in turn, would require him to overturn the results he had negotiated with the majority of Republicans who supported him in previous votes, raising the risk of future conflict with them. Senator John Cornyn, a Republican, put it very pertinently: “The election for the speaker is already so difficult that you can imagine how difficult it will be to pass any law in the future.”
Barton emphasized the importance of leaders being adaptable while avoiding chronic reactive reactions, especially when their own authority may be undermined. Successful leaders are also willing to make unpopular decisions and stand their ground in order to demonstrate their ability to lead the company through periods of chaos, gaining long-term respect and aligning the executive team. McCarthy’s willingness to make concessions to ultra-conservatives appeared to hurt his relationship with more moderate Republicans such as Texas Republican Tony Gonzalez and South Carolina Republican Nancy Mays. The two Republicans were reluctant to ratify the rules of procedure for the 118th Congress, although they were finally passed by a narrow majority on Jan. 9.
Finally, leaders should prioritize building trust over liking. “I know people I don’t like very much, but I trust them. That’s what impresses me more about them than their popularity,” says Patton. Harvard Business Review at A 2017 study showed that employees who work at companies with high levels of trust report 74% lower stress, 50% higher productivity, 76% higher engagement, and 40% less burnout than those at low-trust companies.
Back in Washington, D.C., McCarthy is off to a rocky start, and his presidency will be a challenging and infighting one. Whether he can win in the end depends on his own ability to adapt to the difficulties of the far right while maintaining the trust and respect of most other Republicans in the House of Representatives. (Fortune Chinese website)
Translated by: Liu Jinlong
Reviewer: Wang Hao
The grueling fight to elect Kevin McCarthy as House speaker came to a close on January 7 after the California Republican made several concessions to the GOP’s ultra-right faction. Despite a win in hand, McCarthy’s efforts to secure the speaker’s gavel have weakened his authority, diminished his power, and emboldened the party’s ultraconservative sect, which could create dysfunction and chaos as he tries to lead a party with deep fissures.
McCarthy agreed to several demands from GOP hardliners in the run-up to his appointment, including a rules change that would allow just one member to call for a vote to oust the House speaker and another that would allow caucus members to serve on the House Rules Committee. The attempts to mollify a small but vocal faction have drawn concern and criticism from McCarthy’s GOP peers. “For the House to function, the Speaker has to have authority, and this demonstrates the next Speaker, whoever it is, doesn’t have the authority to manage the House,” an anonymous GOP senator told the Hill.
While the House gridlock was unprecedented, making it the longest contest to become speaker in over 160 years, such clashes are not uncommon in the corporate world. Take the C-suite rebellion at Disney that led to Bob Chapek’s ouster in November 2022: After a series of missteps, including his handling of the company’s pandemic response, reluctance to challenge Florida’s so-called “Don’t Say Gay” bill, billions lost on streaming, and mounting tension with fellow executives and board members, the former CEO was replaced by his predecessor, Bob Igor. His dismissal was reportedly stimulated by Disney’s chief financial officer Christine McCarthy who warned board directors that the company was off course under Chapek’s leadership.
Workplace conflict is inevitable in leadership ranks and can even be valuable when executives openly debate, share ideas, and disagree to drive results. But a toxic, misaligned C-suite can lead to productivity loss, stall progress, and create confusion that reverberates throughout the company. In Chapek’s case, his hesitation to address Florida’s law restricting discussions of gender and sexuality in elementary schools led to employee walkouts and reprimand from current and former executives and left his lieutenants scrambling to assuage worker concerns. With McCarthy, the House could not resume business until a Speaker was elected, and he will likely face challenges to government funding, raising the debt ceiling, and threats to ESG disclosure rules and investing requirements.
“Being a CEO isn’t about making tons of decisions,” Dick Patton, a partner at executive search firm Egon Zehnder and co-head of its CEO practice tells Fortune. “It’s about helping others make tons of decisions.” As corporate governance shifts from shareholder primacy to a broader ecosystem of stakeholders, CEOs must effectively engage their many stakeholders, including direct reports. In the political sector, it quickly became clear that McCarthy failed to engage disgruntled GOP members early on, forcing him to hastily negotiate concessions during the Speaker vote. Those concessions, in turn, required that he renege on negotiations already made with the majority Republicans who backed him in earlier voting rounds, setting up the risk for future clashes with them. Republican Sen. John Cornyn aptly noted, “If it’s this hard to elect a Speaker, imagine how hard it’s going to be to pass any legislation.”
Patton stresses the importance of leaders being adaptive without becoming chronically reactive, especially when there’s potential for undermining. Successful leaders are also willing to make unpopular decisions and decisively stand their ground, demonstrating an ability to guide the company through disruptive periods, securing long-term respect and C-suite alignment. McCarthy’s willingness to bend to ultraconservatives seems to have hurt his standing with more moderate Republicans like Texas Rep. Tony Gonzalez and South Carolina Rep. Nancy Mace. The two expressed reluctance to approve a rules package for the 118th Congress, though it ultimately passed with a slim majority on January 9.
Finally, leaders should prioritize building trust over likability. “I know people who I don’t particularly like, but I do trust. That is a deeper impression of somebody than popularity,” Patton says. Employees at high-trust companies report 74% less stress, 50% higher productivity, 76% more engagement, and 40% less burnout than people at low-trust companies, according to a 2017 study from the Harvard Business Review.
Back in D.C., McCarthy is already facing a bumpy start, and his tenure is poised to be a challenging one with continued infighting. Whether he emerges victorious will rest on his own ability to adapt to the far right’s curveballs, while maintaining the trust and respect of the remaining GOP House majority.
