Corporate America should prep for more regulation, not less, in spite of the rhetoric out of Washington, according to one leading executive adviser.
"In our collective organizations, it is hard to anticipate that we have anything other than more regulation," said Tim Ryan, U.S. chairman and senior partner at PricewaterhouseCoopers LLP. He made the remark in an interview with TheStreet's Jim Cramer at The Deal's second annual Corporate Governance Conference in Manhattan on Monday.
Wall Street has rallied in the wake of Donald Trump's surprise election November, in part due to the hopes that having Republicans in control of Congress and the White House will herald a major deregulatory wave.
The president has promised to "do a big number" on Dodd-Frank and early in his tenure signed an executive order requiring that for every one new regulation, two must be scrapped. The GOP has also used the Congressional Review Act to roll back about a dozen Obama-era rules.
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Ryan, whose conversation with Cramer centered on what is on CEOs' minds at the moment, acknowledged that most corporations would like deregulation but are aware of the challenges of it coming about, especially in a moment when public distrust in Capitol Hill and corporate America is high.
"There's a fairly high degree of enthusiasm for deregulation [among executives]," Ryan said. "Yet at the same token, you have a lot of people who are sitting there saying, 'We don't trust CEOs.'"
"When you look at what policymakers' and regulators' responsibilities are, it's to listen to constituents," Ryan said. "That trust gap is so wide, why would the general populous be willing to sit there and say, 'We trust you more with less?"
Ryan and Cramer touched on a range of matters during their half-hour sit-down, including cyber security, transparency and diversity. Ryan, who has more than 25 years of experience in client strategy and relationship management, predicted that almost every company will experience some sort of "trust crisis" over the next 12 months.
President Trump, who has demonstrated an unparalleled interest in engaging directly with CEOs and corporate America, was of course a topic of conversation as well. His Twitter habits were top-of-mind, given the series of outbursts he unleashed on the platform over the weekend and on Monday.
"Most CEOs now have something in play that they didn't have before, which is what if we're the next tweet?" said Ryan.
"Shame on you if you don't have a plan already [for a Trump tweet]," Ryan said.
Being a corporate executive is harder now than ever, Ryan said, and the president isn't making it any easier. His decision to pull out of the Paris climate agreement exemplifies the dilemma by forcing execs to decide whether to continue to try to work with the White House or not. Tesla Inc.'s (TSLA - Get Report) Elon Musk and Walt Disney Co.'s (DIS - Get Report) Bob Iger resigned from presidential advisory councils; General Motors Co.'s (GM - Get Report) Mary Barra and IBM Corp.'s (IBM - Get Report) Ginni Rometty plan to stay in.
"What many CEOs have to figure out is can you have more influence at the table or not being at the table?" he said.
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