How corporate America fell out of love with Donald Trump

In recent months he had registered some success – although most ­economists question how much it is to do with the new occupant of the White House.

Then came Trump’s response to the violence in Charlottesville and within days the president’s honeymoon with business came to a messy end.

The president’s failure to name and shame the white supremacists was too much for Frazier, who quit the president’s manufacturing initiative. ­“America’s leaders must honour our fundamental values by clearly rejecting expressions of hatred, bigotry and group supremacy,” he said.

It did not take long for Frazier to be transformed, via Trump’s Twitter feed, from poster boy for the recovery to the embodiment of corporate greed – hiking up drug prices and shipping jobs away from the US.

It’s not as if Frazier were the first chief executive to fall out with Donald Trump.

But his departure on a point of principle triggered a flood of other resignations from chief executives who did not want to be associated with Trump after what many thought were his ill-judged remarks over Charlottesville.

Trump was not happy, at first accusing the refuseniks of “not taking their jobs seriously” and branding them “grandstanders” who could easily be replaced.

That was before he gave a disastrous press conference that gave those still on his board the push they needed, however. On a 45-minute call on Wednesday, the CEOs decided to ­disband and leave Trump to his own devices.

The 71-year-old president sought to salvage some pride by claiming in a tweet that he had decided to wind up his Manufacturing Council and his Strategy & Policy Forum. But the game was up.

Given his difficulties in persuading a Republican-led Congress to pass any major legislation, Trump supporters hoped his relationships with business leaders might help him deliver some of his policy agenda.

He had claimed that unlike conventional politicians, he could speak to chief executives in their own language and persuade them to think again about shifting yet more jobs offshore – or even bring some back.

Trump’s negotiating technique is a combination of carrot and stick and he insists it is working.

In late July the president said Tim Cook, Apple’s chief executive, had promised to build “three big plants, beautiful plants” in the USA.

Thus far there has been no confirmation from the company. There are ­suggestions that Apple’s Asian suppliers including Foxconn – manufacturers of the iPhone – are ready to shift some production to the US.

Some argue there has been an element of smoke and mirrors about some of the other deals hailed by Trump.

During the campaign, Trump threatened car manufacturers with a 35pc tax on cars imported from Mexico if Ford pressed ahead with plans for a new plant south of the border.

The plans were scrapped. Mark Fields, who was Ford’s chief executive at the time and a member of Trump’s manufacturing jobs initiative, ­diplomatically praised the new administration’s tax cutting pledges.

But the decision was largely due to a change in strategy with Ford, like a number of other motor manufacturers, stepping up production of electric cars.

Even accepting that the president’s deregulatory and tax cutting ­programme will improve the climate for investment, it is difficult to escape a sense of corporate uneasiness about Trump, which predates the latest ­brouhaha.

The White House has tried to play down the crisis. “We spent the first few months of the administration meeting with hundreds of CEOs to listen and are now putting those learnings into ­action,” a White House official said.

Not everybody is convinced, however, with some believing senior ­business figures are starting to regard association with the White House as toxic.

“I am used to people being proud to say that they are associated with a president like Barack Obama. It was seen as a badge of honour,” said Max Bazerman, Jesse Isidor Straus Professor of Business Administration at Harvard Business School.

“In the current environment, I think it is an embarrassment to be associated with somebody who is morally repugnant and ­incompetent.

“A normal chief executive thinks three to five steps ahead, now we have someone who thinks zero steps ahead.”

Neil Malhotra, professor of political economy at Stanford University’s graduate business school, believes that the wariness is in part influenced by wanting to avoid antagonising the ­public.

“CEOs need to be very careful in how they wade into politics. Increased access to government may come at the cost of a backlash by customers and employees.”

Even during the campaign, there was a taste of this when Linda Bean, a board member of the LL Bean clothing group, endorsed Trump, much to the embarrassment of the company which, facing the threat of a customer boycott, maintained she was acting in a ­personal capacity.

“Public companies have to consider the views of multiple stakeholders, not just shareholders,” said John Quelch, the dean of the Miami Business School.

“Some will stay on board with Trump, either because they regard it as their patriotic duty or because they would rather retain some sort of influence over White House policymaking."

Trump may feel he can do without their help anyway.

He believes slashing taxes and regulations will make the US a more attractive place in which to do business.

Other observers are less sanguine. “I do think it is essential to keep business onside for the Administration, though,” said John Dickerman, the CBI’s head of group in Washington.

Yet for swathes of corporate America, Trump is now toxic.

As Aaron Levie, chief executive of the Silicon Valley company Box asked: “At the point where it’s politically ­unpalatable for businesses to work with the ‘business’ president, what’s his value proposition?"