In bad economy, CEOs don't want to be seen playing golf

— -- Many CEOs have been shamed into playing less golf, or at least humiliated enough by their tanking public image to play their rounds on the sly.

"CEOs are golfing less … and those that are still golfing are probably talking about it less," says Steve Bennett, who retired as CEO of Intuit in December 2007 after being ranked by Golf Digest magazine as the ninth-best golfer among large-company CEOs in 2006.

Perhaps nothing is more symbolic of the CEO lifestyle than golf. A 2006 USA TODAY analysis of 115 golfing CEOs of large companies found 25 belonging to three or more country clubs at the same time. But an unscientific survey for USA TODAY of 163 CEO golfers by the CEO organization Vistage International this month found that 29% had reduced their rounds and another 11% have stopped playing altogether.

"It's a byproduct of bad economic times," says NetApp CEO Dan Warmenhoven, one of four who in 2001 paid $660,000 at a charity auction to play with Tiger Woods using Warren Buffett as caddy.

Many CEOs and CEO experts say image is largely at play. Just 25% of adults have a favorable opinion of CEOs in the June Rasmussen survey, the lowest of all professions surveyed, including members of Congress at 30%. Among other executives, only 14% have a positive view of CEOs, according to research released this month by Weber Shandwick.

Their sinking image has them parking their clubs even before they quit other activities that seem more time consuming and extravagant. Where it comes to golf, "CEOs have been in a fetal position for the last six months," says Ted Kennedy, president of CEO Challenges, which sponsors $1,000-a-day athletic events from sailing to auto racing, and in August is hosting a triathlon to crown the world's fittest CEO. But there has been zero interest in golf, and no events are scheduled for 2009.

Donations to charity suffer

Charity is a victim of this sudden radioactivity. Golf events raise about $3.5 billion a year, according to SRI International, and only $130 million of that was generated by professional tours. The rest came via 16,000 golf clubs that provide venues.

Hilary Fordwich, who once ran KPMG's global marketing, is now president of Strelmark Business Development Consultants in Washington, D.C. An avid golfer, she qualified for two Women's Southern Amateurs with a single-digit handicap, and her website is peppered with links to golfing sites and to her video interviews of pros, including Jack Nicklaus.

Fordwich regularly invites CEOs to golf fundraisers for charity, but when she recently approached the CEO of a large government contractor to sponsor a pro-am for the PGA's tour in support of the Melwood charity for the disabled, he declined. The company had participated in the past and was doing well in the current economic downturn. The only explanation was that the CEO did not want to appear in a public golf event, concerned about image at a time when Congress is sensitive to CEO excess, says Fordwich, who declined to identify the CEO or company.

The CEO, instead, invited Fordwich to a private golf outing. Golf was still played, only the charity suffered, Fordwich says. The public thinks the fundraising tournaments are "boondoggles," but this is how money is raised, she says.

Such delicacies seem to end where golf meets Washington influence rather than Washington scrutiny. A USA TODAY analysis of lobbying efforts published this month found that when companies contribute to the charities of members of Congress, they are often rewarded with invitations to play golf with those working on health care and other issues of enormous financial consequence.

Barney Adams, founder of Adams Golf and holder of golf patents, says he is not a fan of being politically correct for expedience. He says that both the game and the charities deserve better and calls CEOs "hypocrites" when they quit or hide their golf for public relations reasons.

Leslie Gaines-Ross, a longtime CEO watcher and chief reputation strategist at Weber Shandwick, doubts if fewer CEOs are playing golf. "But no sane CEO would dare brag about his or her golf game during these difficult economic times. CEO reputations are extremely vulnerable, and CEOs are hypersensitive about bad PR. Why throw oil on the fire?"

Using golf as a stress reliever

MGIC Investment CEO Curt Culver, the best CEO golfer of 2004 as ranked by Golf Digest, has been golfing since he was 5 and wore golf attire at his first job interview with MGIC in 1982 because he was coming from a Milwaukee tournament. In 1996, he beat Arnold Palmer by a stroke and displays the score card in his office.

Culver's handicap has nearly doubled from 2.4 to 3.8 (the lower the index the better the golfer) but he still finds golf a great stress reliever at a time when MGIC stock has fallen 94% from the start of 2006.

"Obviously, our business has been very difficult the past two years," Culver says. He says he is "clearly playing less golf," and also has less time for family and community work.

Bennett agrees that the game is important to the mental well-being of leaders consumed by problems. "Golf was the only time I could really escape everything else that's going on, all the pressure and everyday burden."

Is golf good for CEO performance, or is it a distraction? That issue has been hanging around at least since the late 1990s when the economy was humming and CEOs took pride in making the list of best CEO golfers published by Golf Digest every two years. No. 2 Jack Welch of General Electric even challenged No. 1 Scott McNealy of Sun Microsystems to a match for bragging rights.

Times have changed. Golf Digest broke its every-other-year cycle and did not publish the list in 2008. Both Welch and McNealy declined comment for this story, even though both are retired. Welch has been replaced by Jeffrey Immelt, who plays some golf, but who joked to USA TODAY in 2001 that he would stand a better chance against the shorter Welch in basketball. McNealy has been replaced by Jonathan Schwartz, who told BusinessWeek magazine in 2007 that golf is "just not who I am."

"I spend so much time at work that I'd rather be with my wife," says Coldwell Banker CEO Jim Gillespie, who plays a couple of times a year but says so with a tone of obligation.

Graef Crystal, an outspoken critic of CEO compensation and perks, has twice studied large companies run by CEOs with good golf games and has found those companies, in general, tend to perform above average. He says his "pop-psychology take" is that superior corporate performance may require the same focus and discipline required of good golf.

How golfing CEOs have fared

But there are recent indications that the superior performance by golfing CEOs is slipping:

•Of the 12 best golfers in the 2006 CEO Golf Digest list, seven are no longer with their companies: Jim Crane of EGL, Jerry Jurgensen of Nationwide Financial, Steve Macadam of BlueLinx Holdings, Bennett of Intuit, Mike Eskew of UPS, David Perdue of Dollar General and Ted Chandler of LandAmerica Financial.

•Patricia Russo, the only woman to ever crack the magazine's list of 200 best golfers, exited as CEO of Alcatel-Lucent in September.

•The most-improved golfer from 2004-2006 was Macy's CEO Terry Lundgren, who went from 178th to 91st. Lundgren remains at Macy's, but the stock is down 66% since the start of 2006 vs. a 28% decline in the S&P 500. Lundgren declined to comment.

•Among the five of 12 best CEO golfers still on the job, performance isn't exactly sparkling. The stock market has devastated many companies, but of the five, only Ed Stack of Dick's Sporting Goods has significantly out-performed the market, with just a 2% drop from the beginning of 2006. Stanley Works under John Lundgren is down 30%, while Constellation Energy under Mayo Shattuck is down 54%, Crosstex Energy under Barry Davis is down 84%, and MGIC Investment under Culver is down 94%.

Even Stack, the most successful CEO golfer, declined to comment on the topic.

Then there is CF Industries, the company from the list with by far the best-performing stock since the start of 2006, up 359%. Does CF Industries CEO Stephen Wilson play golf from time to time? That's difficult to determine.

"Right now, CF Industries is involved in a hostile three-way takeover tussle with two other fertilizer producers, Terra Industries and Agrium," says spokesman Charles Nekvasil in an e-mail.

Nekvasil continues: "In all honesty, even talking about golf (or vacations, or cruises, or office parties or anything else) would send a signal to our shareholders that we aren't 100% focused on these transactions and creating shareholder value. We'll take a pass on this."

Contributing: Tom Ankner