Jon Huntsman: Testing Values under Pressure
In preparing for a day when your values conflict with those of your organization and with each other, you need to decide what you want to stand for in your life. How will your obituary read? What do you want people to say at your funeral?
The life of Jon Huntsman, founder and chairman of Huntsman Corporation, the $8 billion chemical company, illustrates the way one person answered these questions. To the outside observer, Jon seemed to lead an idyllic life, one marked by integrity, clarity of values, a large and successful family, and material success. Yet Jon had been tested at least three major times in the most severe ways. Each time he was forced to look deep inside himself to determine what he stood for.
Jon had strong views about his values and the importance of values in the lives of others.
Each of us possesses a moral GPS—a compass or conscience programmed by parents, teachers, coaches, grandparents, clergy, friends, and peers. The compass is an integral part of our being. It continues to differentiate between proper and improper behavior until the day we die.
Born in a humble family in rural Idaho, Jon said his values and leadership are inextricably linked to his family roots. Although he was close to his mother, he never developed a close relationship with his father, who was a stern disciplinarian. “My mother was a sweet, loving person who never said a negative word about anyone. Because of her, my heart has always been soft.” He observed, “I was taught to play by the rules: Be tough, be competitive, but do it fairly.”
The principles we learned as children were simple and fair. With moral compasses programmed in the sandboxes of long ago, we can navigate career courses with values that guarantee successful lives, a path that is good for one’s mental and moral well-being, and the opportunity for long-term material success.
When he was just out of college, his mother developed breast cancer and died in her fifties. “She suffered so much that it broke my heart,” he said. Nor was her suffering the family’s only brush with cancer. His father died of prostate cancer, and his stepmother died from ovarian cancer. Like a dark cloud hanging over the family, Jon himself has had to overcome cancer twice.
Jon faced a test of his moral compass when working in the Nixon administration, shortly before the Watergate incident. After founding his own company, he was hired by Elliot Richardson, secretary of Health, Education, and Welfare (HEW), as associate administrator of social services. Jon’s success in installing a management-by-objectives program that saved $100 million in six months brought him to the White House’s attention, where Bob Haldeman hired him. Jon found the experience of taking marching orders from Haldeman “very mixed.”
I had been CEO of a company and then was running a big division at HEW. I wasn’t geared to take orders, irrespective of whether they were ethically or morally right. We had a few clashes, as plenty of things that Haldeman wanted to do were questionable. An amoral atmosphere permeated the White House.
One day, Bob asked Jon to help him entrap a California congressman who had been opposing a White House initiative. The congressman partially owned a plant that reportedly employed undocumented workers, and Bob wanted to gather information that could be used to embarrass him. Jon said, “I was under the gun from Haldeman to call my plant manager and place some Latino employees from his Huntsman facility on an undercover operation.”
There are times when we react too quickly and fail to realize immediately what is right and wrong. This was one of those times when I didn’t think it through. I knew instinctively it was wrong, but it took a few minutes for the notion to percolate. After 15 minutes, my inner moral compass enabled me to recognize this wasn’t the right thing to do. Values that had accompanied me since childhood kicked in. Halfway through my conversation with our plant manager, I said to him, ‘Let’s not do this. I don’t want to play this game. Forget that I called.’ I informed Haldeman I would not have my employees spy. Here I was saying no to the second most powerful person in the country. He viewed responses like mine as signs of disloyalty. I might as well have been saying farewell. I left within six months.
After resigning from the White House staff, Jon and his wife, Karen, faced a different type of values test when their youngest son, Mark, was born with severe cognitive disabilities. Mark’s doctor told his parents their son would not be able to read, write, or go to school, because his mental capacity would never go beyond that of a 4-year-old. The doctor recommended Mark be institutionalized, which represented an impossible values conflict for the Huntsmans. Family was everything, and Mark was just as much a part of their family as their other children. They decided that whatever it took, Mark would live at home.
When Penny and I visited the Huntsmans to tour their cancer institute in 2002, Jon proudly introduced us to Mark, who greeted us with a friendly smile and a big hug. “Mark doesn’t know what people do for a living, and can’t tell a custodian from a CEO,” Jon told us.
He judges people only by the goodness of their heart. He sizes up individuals quickly and spots phonies immediately. If their heart is good, he gives them a big hug. Every day, I learn from watching him. He has been the role model and anvil of our family.
In 2001, Jon faced the biggest challenge of his career. Because of a deep recession in the chemicals and packaging market, his company was on the verge of bankruptcy. Prices and profit margins were falling rapidly, just as energy costs and raw material prices were spiraling out of control. As a consequence, Huntsman’s bonds were trading at 25 cents on the dollar.
On a somber day, financial experts, lawyers, representatives of his 87 lenders, and bankruptcy experts from New York and Los Angeles gathered in Salt Lake City and presented Jon with their unanimous opinion. He had but one choice: Seek a court-supervised Chapter 11 bankruptcy or sit helplessly by as creditors shut the company down altogether by refusing to ship vital raw materials.
Listening patiently to their analyses and entreaties, he thought to himself, “I will not let this company be seized by corporate lawyers, bankers, and highly paid consultants. Not one of them can comprehend my notions of character and integrity.” Jon answered in a single word: “No.” To him, bankruptcy was not an option. His name was on the door—and on the debt. He believed his integrity was at stake.
There are times when consultants, lawyers, and outside advisers would like to tell us how to run our lives. Are we people of character, integrity, kindness, and charity, or are we going to be motivated by what somebody else says? At the end of our life, we have to determine what we want said at our funeral.
Jon called his team together in this dark hour and told them, “We are going to make it. Our name is on the door. We will go to every one of our 87 bankers, and carve out deals that we can live with. We will bring in our bonds and redeem them for equity.”
The company went through three years of turmoil, while Jon refused to give in. His wife’s support proved essential. He said, “You have to have someone next to you who is tremendously sympathetic. My bankers and close associates abandoned me, so for years Karen was the only one there for me. She knew me best and understood how critical it was to me to maintain my integrity. If one person lost one penny anywhere along the line, I would have lost my character as a man.”
During the process Jon had a heart attack and contracted Addison’s disease—perhaps because of his run-down immune system. However, he said with pride, “I repaid every single debt. As of today, the bondholders have been paid 100 cents on the dollar. Huntsman’s creditors have been paid in full and have extended us more credit. Huntsman stock is doing well, and our earnings are the highest in history.”
Reflecting on his financial crisis, Jon commented, “Building goodwill, being honest and kind, and paying your bills along life’s pathway will serve you when you’re down and out.”
There are times in our lives when we have to ask ourselves, ‘Are we going to let this erosion of our life happen, or are we going to step up and change it?’ Your life speaks for itself. If I had tried to cheat somebody during my lifetime or did not play by rules, they would have exercised their natural rights when I got in trouble.
Do you know how you will respond in similar situations? What do you stand for in your life? Once you know that, it is essential to be true to what you believe. The only way to prepare for crises like these is to understand your values and then apply them in practice. For living by his principles, his outstanding business success, and his generous philanthropic contributions, Jon was awarded the prestigious Bower Award for 2015 by The Franklin Institute, given annually to America’s top businessperson. He passed away in February 2018 at the age of 80.