ConnectOne CEO Says Leaders Should Explain Risks, Not Promise Outcomes

ConnectOne Bank Chairman and CEO Frank Sorrentino III says executives can manage uncertainty by explaining the facts and risks behind decisions, a message that echoes Federal Reserve Chair Kevin Warsh’s push to limit forward guidance. In an Oct. 15 commentary, Sorrentino argued that leaders should state what they know, what they are monitoring and how they may respond as conditions change. His advice addresses decisions made before executives can know whether rates, inflation or business conditions will follow a particular path. He urged them to describe the basis for a decision rather than promise a fixed outcome. Sorrentino said his conversations with business owners often involve hiring, property purchases, acquisitions or borrowing. He does not offer a six-month prediction for rates or inflation.

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