Four years ago, I commented on the then-recent announcement that Jamie Dimon, Chairman and CEO of JP Morgan Chase, was battling cancer. At the time, Dimon noted that he had struggled with whether the company should disclose his illness.
It’s a struggle that executives, companies, and their securities lawyers face when a CEO is diagnosed with a serious illness, or when there is some other arguably personal news about the CEO. With apologies for quoting myself, here is an excerpt from my 2015 posting:
“It’s a very challenging issue for several reasons. First, there isn’t any rule – or even any literature (at least to my knowledge) – that tells us whether and what to disclose in this situation. So when a client says, “show me the rule that says we have to disclose this,” there’s nothing to show. Second, and more important, the issue pits the need to disclose against information that is quintessentially personal. It’s also not just an issue between the executive and the company; often, the executive’s family and, possibly, his/her medical team and others are equally involved. And even when there’s agreement to disclose, it’s very difficult to know what to say about the prognosis, if and when the executive can return to work, and so on.”
Another example came to light a couple of weeks ago, when Marriott International, Inc. announced that its CEO had been diagnosed with stage 2 pancreatic cancer. It is interesting – and, in my view, a good thing — that Marriott announced the illness even though the name of its CEO, unlike Dimon (or Steve Jobs, whose fatal illness went unannounced until the bitter end), is not synonymous with the company; it’s hard to imagine too many people asking which companies were headed by Dimon and Jobs, but if one were to drop the name “Arne Sorenson,” it’s not clear that too many people would say “oh, you mean Marriott’s CEO.”
It’s also interesting that Marriott’s stock price actually rose following the announcement. I am in no way attributing a cause and effect connection between the announcement and the stock price increase, but I’d like to think that in this case, doing the right thing may have been its own reward.
Marriott’s announcement stated that the CEO was beginning chemotherapy the following week, with surgery expected by year-end. I wish him well.