[♪] did you feel that there was a glass ceiling? there were people, who said to me, i don't think a black person could ever be ceo. on september, the 11th, tragedy occurred not far from here. i talked to them about the fact that i cared a great deal about them and their families. somebody bought $175 million work of art, was that to get points? do you ever leave home without your american express card? i never leave home without it, and when i'm at home, it's always with me. woman: would you fix your tie, please? well, people wouldn't recognize me if my tie was fixed, but okay. just leave it this way. [♪] [david reading onscreen text]

i began to take on the life of being an interviewer, even though i have a day job of running a private equity firm. [david reading onscreen text] you graduated from harvard law school in 1976. and, like many people in that generation, my generation, you went to practice law at a large firm in new york. why did you leave after two years, as i did, did you not like to practice law? i, actually, david, enjoyed the practice of law, and i didn't have any grand scheme that i would go into business. but i've always been someone who really was energized by new opportunities and challenges and i'm very intellectually curious. i was contacted by bain & company, and when i went up to interview,

i was just really impressed with the dynamism, the intelligence, the types of activities that they were involved in. and i really felt it could be an incredible learning experience for me. you have to then tell your parents, i went to law school for three years, i'm a lawyer, and now all of a sudden i'm not going to be a professional in that area. i'm going to go be something called a consultant, what did they say? well, i must confess, that, uh, both my parents were... frankly, concerned. they said, "you've gone through this training "to be a lawyer, that seems like a very good profession, "what is it that consultants do?" and i said, "they advise corporations on strategies." "well, ken, what do you know about business?" well, i don't know a great deal about business. although i've had some experience working with corporations from a legal perspective. "well, how are you going to get the training?" and i said, "well, they're going to, in fact,

"put me in a training program, also give me books, but i'm going to learn on the job." "well, could you tell us about some of their clients?" "well, that's confidential." well, for my parents, that sounded very mysterious. and so my father finally said, "look, you're young enough that if this doesn't work out, "and the probability is it's not going to work out, "you at least have a career to fall back on, "and you can go back to becoming a lawyer." well, in my case, my mother still asked that i keep my bar exam current and i'm still a member of the dc bar, 'cause she says if carlyle doesn't work out, i have something to fall back on. so i know the feeling. so you went to bain, right. and you're only there a short period of time. an executive recruiter called, i had been at bain for two and a half years, similar pattern, i was enjoying the job, i had no plans to leave, and then i was contacted about american express, and, very frankly, david, i had questions

whether i belonged at a large company. i could see myself at some point doing something that i considered to be more entrepreneurial. right. but the more i... studied the company, what i was impressed with was the pace of change that was occurring in the industries that they were competing in. they, in fact, had done a deal with warner cable, a joint venture, they were entering into the financial services business. they had acquired shearson, and so it seemed like a very interesting place, and then, frankly, what really sold me on it was lou gerstner, who, at that time, was president of the major division at american express. travel related services. and he was forming a very small strategic planning group. one of the things lou said to me that really has stuck with me throughout my career is "i want a few catalytic agents of change." and so that concept of being a change agent

was very important. so you went to work for lou gerstner, he wanted to shut down the so-called merchandising part of american express travel services, and you said no, you would go run it, and what was that about, how did you turn that around? the merchandise business was intriguing to me, i first went to the business as head of marketing, lou was not thrilled that i did that, but to his credit, he allowed me to do it. and then, two months later, we had a review with lou, and lou said, "i think i'm going to close down the business." and i said, "lou, could you give us three weeks "to come back to you with a strategy, "because i really believe that this is a business "that not only has growth potential, but is a business that can help american express achieve its strategic objectives." and so we presented him with a strategic plan, he accepted that plan, and, uh, around eight months later,

i was appointed head of the merchandise services group, and we were able, in a period of two and a half to three years, to grow sales from 100 million to 700 million, selling a range of merchandise products. we sold furniture, we sold jewelry, we sold electronics, and it was just a fascinating opportunity because i had every aspect of a business to run, and so it was a great learning experience. in the 1970s, and then you were here in the 1980s and the 90s, there weren't that many ceos of fortune 500 companies who were african-american. did you feel that there was, uh, kind of a glass ceiling? you couldn't become ceo. or you didn't feel that discrimination existed here? here's what i think is important, david, for me, and my story, is when i came to american express, my objective was not to become ceo. it wasn't that i lacked ambition, but it just was not in the realm of possibility--

not because of my race, more so because i just wondered if i belonged in a large company, if i would be satisfied, if i would be stimulated. over time what i found was that american express is really a company of ideas, and i like the fact that this company has this commitment to service. and you can really implement ideas in a relatively short period of time in the marketplace. there were people, frankly, both inside and outside the company, who said to me, "i don't think a black person could ever be ceo "of a company like amex, american express." and, my view, taken, frankly, from my parents, was one that obstacles were to be overcome, and my father had a great saying, that focus on the things you can control.

and the one thing that you can control is your performance. what i found at the company was a very supportive environment, the mentors that i had, the board, certainly encouraged me to think about the opportunity and the potential to become ceo. so despite the fact that i did encounter doubters, both inside and outside the company, i think that the management team and the top management team at the company, was very encouraging to me. so when you became the ceo in 2001-- january 2001. so did you hear from all your high school classmates telling you they knew you were going to be successful? there were, frankly, some people when i was growing up, who thought that my vocation would be more politics than business. but you certainly encounter those people who feel that they knew. i think, frankly, that there was no way that someone

would have guessed, at the time that i grew up, that i would have the opportunity that was presented to me. no regrets that you didn't go into politics? i don't. i do, though, have a very strong social conscience. and one of the reasons i did go into law in the first place is because i felt i could have an impact on society. one of the things that i feel strongly is that people in business have a responsibility and an obligation to make a difference in our society. in 2001, you become the ceo, yes. on september the 11th, tragedy occurred not far from here. you were in salt lake at the time, what was your response, how did you handle that leadership challenge you had then? well, that was, david, an incredible challenge at any point in someone's career. but particularly in my first year as ceo.

and one of the first things that i was able to do when i was able to get the management team together is i said to them that it is our job, in fact, to lead this organization. and what was important through that whole ordeal, as you know, we had several employees who perished. that was emotionally traumatizing. the travel business was in disarray as a result of 9/11. spending dropped precipitously. i decided that since we could not go back to our building, we were actually spread out in several different locations in the tri-state area, is i got all of our employees in the tri-state area to come to an event at madison square garden.

i see. i talked to them about what american express represented. i talked to them about the fact that i cared a great deal about them and their families. and that i believed that american express was going to be able to overcome the challenges that we faced because this was a time where, frankly, a number of people were writing off the company, did not think we were going to be able to come back. why is that? because travel had gone down, and travel card usage would be reduced? that's right. but you did have to lay-off what, 15,000 people or something like that. david, this is very important from a leadership standpoint, is that one of the things that i believe very strongly and in fact, is a leadership maxim that i came across in my twenties. as you may know, i love to read biographies. and napoleon had a quote that i paraphrase,

that the role of a leader is to define reality and give hope. and that was a constant refrain from me throughout 9/11. it's a term i use probably several times a week. and what was absolutely important was to be decisive and compassionate. and i was very transparent in explaining the reasons why we had to do the lay-offs. it was obviously painful for the organization, people understood the context of the situation that we were in, but that was a very, very challenging time. we emerged stronger as a company, but certainly the leadership of this company and my leadership was tested at the highest level. you need to study who are really outstanding leaders. getting feedback from all types of sources,

both inside and outside the company, are very important. i think there are leadership development programs that are very, very helpful. and one of the things i've found has been incredibly helpful to me is to get 180 degree, 360 degree feedback because then you really have an understanding of how people view you, and the impact you're having on people. so i first became familiar with the company when, i think, i was in high school, traveling around and my parents would get me a traveler's check. if you remember what that is, i guess. i absolutely do. so you signed it, and you cashed it in, and so forth, and it seemed like a great business because the company, american express, would get the float, on the money, and then eventually it was cashed in at six months, so you get the use of the money. does anybody still use traveler's checks? people still use traveler's checks. in fact, we're celebrating 125 years in the traveler's check business. it's marketed in 22 countries.

it is still being used in eastern europe, it's being used in a range of countries. people sometimes like to have that tangible traveler's check, they view it as safer than money. it is not a growth business for us, david. how long does one typically have them, the check, before they cash it? is it a one month, two months, or... how long do people actually-- it really depends, i mean, some people will cash it in a few weeks if they're on a trip or a few days or several months and there's some people, who in fact, have kept traveler's checks for years. we like those people. let me talk a moment about the company that you've headed for a number of years. what was the roots of american express? we started in 1850, and i think what's very important, and it really demonstrates the power of a brand,

and the power of reinvention and transformation. we started out as a freight-forwarding company. what does that have to do with the payments business? the heart and soul of american express and our company is our commitment to service. that is what we believe in. that's what's made us a respected brand. there were two other attributes that were very important in the beginning. trust and security. because if we were transporting goods and services, across the country and around the world, you had to trust that company. you had to feel secure to release your goods to that company. and that was very, very important and the service commitment was critical. david: the credit card was invented by american express, or the american express credit card was invented in 1958. i got mine in 1975. and proudly use it ever since then,

but tell me, when i use it, i'm supposed to pay off my bills every month. at least that's the card that i have. right. what percentage of people actually do pay off their bills every month? well, i can't give you the exact percentage, but it is a very good percentage that pay their bill. so how do you make money? you charge a fee to somebody annually, an annual fee. yes. and then you get a fee from the merchant, is that right? that's right. the essence of the credit card business, the other cards, i won't mention them, but your competitors, they seem to make money off the interest charges, is that a different business, really? no, in fact, what's very important, david, is providing customers with choice. so you're absolutely right that we make money from a portion of the purchase that you make at an establishment. there's an annual fee that varies based on the type of card that you carry.

and then also, we charge interest on outstanding balances so we do offer revolving credit cards. what's different in our model is that, um, net interest income is around 18 to 20 percent of our revenues. for a bank card, that's 60 to 80 percent. the credit card is still the bulk of your earnings or revenue? yes. so sometimes if i'm in an unusual country, or unusual city and i charge a large amount for some purchase or something like that, my office gets a call right away from somebody at american express saying, your card could be used in a fraud situation, can you verify that? how good is your fraud detection kind of thing, and does it work when somebody makes a very large purchase in some unusual country? yeah, what's very, very important is we have a credit authorization system. we literally make a decision on every single transaction. and what's important is we have an integrated business model,

where we have information and data from the merchant, and we have information and data from the individual customer, or corporate client. and we have a range of algorithms and so, literally, instantly, we can run those algorithms and decide if you are eligible to make that purchase. and that works very well for us. man: amedeo modigliani's nu couché, or reclining nude, was a top prize that went for top dollar. i read recently that somebody bought a $175 million work of art and he charged that entire work of art to the american express card. do you have to clear that in advance? i can't acknowledge whether that took place or not, from a privacy standpoint. what i will say is-- suppose i wanted to buy a $175 million work of art-- david, if you want to buy that, i am sure you'll be approved.

and if you would like to talk after this interview about any other purchases... okay. we'll have that conversation. okay. so have you ever used your american express card and had it turned down? that has never happened to me. really? when i took over the card business in e early '90s, we did have a policy for top management, that they had an automatic override. and i thought that was absurd. because i wanted our top executives to have the experience that every customer had. and so we did have some executives that were declined for a purchase. so let's suppose sometimes you go to buy something at a place and it says-- you put down your american express card and say "we don't take american express." i'm sure that you don't like when you hear that, but when you-- i don't. i know you don't like it and you probably can argue with them, but what do you do? do you walk out, or do you say "i have another card"?

and what is your other card that you might use? i don't have other card. you don't have another card? i do not have another card. i only use american express cards. but what happens when you go to a place that says we don't take american express? you just walk out? i walk out because there are alternatives. i mean, the reality is that we can meet the vast spending needs of our customers. there are other options that i have. and it certainly is in my interests to take advantage of those options. does your wife--? is she allowed to have a visa or mastercard or your children, they can't have one either? well, i think you know my wife is very independent. okay. she has decided on her own that she only carries our products. now, what's very, very important is i study the competition intensively. we do have people in the company who have other cards, who test them, who use them, so we can find out what's happening in the marketplace. and i think that's very important. today, going forward, what do you think

the biggest challenge for american express is? i think what's really exciting, what's happening in the marketplace right now, is the convergence of online and offline. and obviously, technology is having a major impact, mobile is having a major impact. foreign factors are changing. so 10 years from now, i don't know if plastic will be used at the same level. and so that's why we have a very good partnership with uber, with airbnb, with facebook, we obviously are involved with apple pay, with samsung pay, with android pay, but what's very important is not to look at payments as simply facilitating a payment. is to also look at payments as a platform to deliver services. your largest shareholder, i think, is warren buffett, does he call you up every day and say, "here's what you should do to increase the value of my stock"? or does he leave you alone? i've been really privileged

to have warren buffett as an investor. he's been a very strong supporter of the company, a very strong supporter of me. he is not someone who is on your case of how's the stock price doing every day. what he's focused on it is, "what are you doing "for sustainable success? "what are you doing to differentiate your products and services," because he's very focused on making sure you have a unique and differentiated business model. but i have enjoyed my interactions with him. i call him. hard to get him on the phone or? he also calls me, it has... he is so easy to get on the phone. his character and the type of person that he is inspires me to want to do better for the company. so do you believe that leaders are born

or are they made or...? how do people become great leaders? i think it's a combination of both. i draw the analogy to great athletes. i mean, there are some great athletes that are born, but unless you practice your craft, those skills will dissipate. and so there are certainly people who have innate leadership capabilities. but i'm a strong believer that you have to look at leadership as a craft. today, as an african-american leader of this company, you're obviously a visible symbol of african-american leadership in the business world, but when you ultimately decide to do something different, are there other diverse leaders in this company that you've been able to recruit? do you have a lot of other african-american leaders? women? other people of different ethnic backgrounds? how have you been able to do that? yeah, i think what we've been very, very focused on is diversity. and we have a quadrat of people around the world that i think can move up in this company

and i think that's important. outside of american express, you have been very involved in some philanthropic things. one that i am very familiar with as well, is the african american history enclosure museum where you've been the leader in trying to get americans to contribute to that, and very successfully, you have gotten i think over $300 million now has been contributed as a result of your efforts. how did you manage to convince people to give over $300 million to that cause? well, first let me thank you, david, because you've been one of those contributors and you've made a big difference, not only to the museum, but to the smithsonian overall. you were very persuasive. it will celebrate great achievements against great odds. it will remind us of the power of dreams and faith. what was critical in the beginning, was to emphasize to people that this was not just a museum for black people.

i imagine holdin' a little hand of somebody and tell them the stories that are enshrined here. and together we'll learn about ourselves, as americans. we'll walk away that much more in love with this country. this is a museum for america. and what people are seeing is america through the lens of the african-american experience. but what they're also seeing is this museum really represents the values of this country. when you do decide to leave american express, what would you like people to say is your legacy? what i'd like people to say, first and foremost, because i believe this is important for any leader, is that ken chenault is a person with high integrity. ken chenault is a change agent.

he's focused on innovation, he has developed people, and he has left the company stronger and positioned the company for sustained success. do you ever leave home without your american express card? i absolutely never leave home without it, and when i'm at home, it's always with me. [♪] ♪ you're watching pbs.

(upbeat music) - [jim] coming up,p, kevin barnes is the founder and leader of the indie rock band, of montreal. after 20 years and 14 albums, he still is much an enigma to those close to him as he is to his fans. - what i discovered through the creative process was that i could get this sort of fulfillment through working, that maybe other people would get through just hanging out, and having close relationships. - [jim] long before selfies, portraits were a way, for those who could afford it, to help shape their public image. - portraiture, i like to quote picasso, is a lie that illustrates the truth. - [jim] and recognized as one of america's best dressed man, designer, attorney, and afrobeat musician, wale oyejide, is on a mission to help all men unleash their inner fashionista. - i try not to let people convince themselves that something is not for them. if it's something that you appreciate,