Papa John’s founder resigns as board chairman after admitting to using racial slur in meeting

Papa John’s founder John Schnatter has stepped down as chairman of the company’s board following one too many tasteless, off-the-cuff remarks.

During a conference call with a marketing agency that was meant to address how to avoid embarrassing public relations incidents, Schnatter somehow managed to engender more bad publicity for his company. The former CEO was completing a role-playing exercise meant to teach him how to avoid making PR mistakes following remarks he made during the NFL Anthem controversy that some considered insensitive.

When asked how he would distance himself from online racist groups, Schnatter responded by making a strange equivocation, stating, “Colonel Sanders called blacks n*****s,” before recalling how African Americans used to be dragged from behind pickup trucks and killed in his home state of Indiana.

Imprudent pizza prince

Schnatter has maintained his role as the public face of the pizza chain he founded 33 years ago, appearing in commercials and branding materials as an iconic American CEO and businessman.

He was forced to resign his executive role in November when he said “NFL leadership has hurt Papa John’s shareholders” following the “take a knee” protest embraced by many players and coaches across the league.

As a league sponsor, Papa John’s may have taken a hit when Americans turned off their televisions in response to the Anthem controversy and refused to watch football in protests of their own. However, these losses were minimal compared to the 11 percent hit Papa John’s absorbed to its stock valuation following Schnatter’s comments.

Eliciting accusations of racism, he resigned as CEO while remaining on the company’s board of directors and in television ads.

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PR stunt gone wrong

As a result of the public outrage, Papa Johns’ executives decided to set up a meeting with the the marketing agency and have Schnatter go through a series of PR exercises.

But after citing Kentucky Fried Chicken founder Colonel Sanders, dropping an unwarranted racial slur, and downplaying his comments from November, multiple people involved in the conference call told Forbes that they were offended, and the marketing firm cut ties with Papa John’s.

In a statement to Business Insider, Schnatter admitted using the profane language and reaffirmed his company’s opposition to racism, saying: “News reports attributing the use of inappropriate and hurtful language to me during a media training session regarding race are true. Regardless of the context, I apologize. Simply stated, racism has no place in our society.”

He went on: “Our company was built on a foundation of mutual respect and acceptance. We take great pride in the diversity of the Papa John’s family, though diversity and inclusion is an area where we will continue to strive to do better.”

The real cost

The pizza founder was also careful to remind consumers that he used the slur to condemn racism, although judging by the response of people present at the time, they did not agree with this context.

In total, Papa John’s shares have plummeted by 25 percent since the founder’s series of controversial statements began in November. Thousands of jobs have been affected and numerous lives touched — all because of the vulgar remarks of a crude and misguided former CEO.

Rather than strip Schnatter of his discreet role as chairman of the board, hopefully the pizza chain will wise up and get him off of American television screens before he does more to tarnish the great company he created.

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