Untangling the Give and Take of Corporate Activism

Originally published at https://www.consultqb.com on September 16, 2021.

Our lives during this past year and a half have been turbulent, uncertain, and overwhelming, to say the least. We’ve reimagined where, when, and how we work, and our expectations of the companies we work for have shifted, too.

Corporate citizenship, which speaks to the social responsibility of business, hasn’t retained the same meaning since it was coined back in 1953. Stakeholders today are simply asking for more. The result: flourishing, messy corporate activism.

Corporate activism- public advocacy and stances for social change or legislation- has turned heads in more ways than one since the pandemic began. Initially, we saw companies fill supply voids in sanitation and food at the peak of health restrictions. They spoke up and assessed their own involvement in racial inequality throughout widespread civil unrest. Since, we’ve seen an all-star game relocated in the name of infringed voting rights, and operations halted in conflict-ridden regions abroad. It doesn’t (and won’t) stop there.

In this space, the only constant is change: here are some trends guiding how companies use activism to mobilize and account for their circle of stakeholders.

Tap into Togetherness…

The value-add of environmental, social, and governance (ESG) to business conduct is proven, and McKinsey & Company emphasizes that “building a strong connection with broad elements of society creates value, not least because it builds resilience into the business model”. Corporate activism extends that connection between business and society. Whether proactive or reactive, corporate voices are inherently powerful, but power doesn’t equate to purpose.

By being bold and responsive to our sociopolitical climate, the strongest corporate activists lend their platforms and influence to elevate issues that matter to their stakeholders.

Taking strategic initiative reflects a key function of corporate activism: to convene stakeholders during times when we need it most.

…and the Effects Can Ripple Down

Activism bleeds values, and employees, customers, investors, and partners take notice. The Harvard Business Review uses issue fluency and depth of engagement as indicators for the degree of follow-through (think ‘walking the talk’) when corporations project their stances externally. Does the company you work for or support live its values? Has it made investments that target structural change? These questions are among those that determine credibility and consumer confidence.

Here, walking the line is a reputational risk. In a review of public letters and statements, a hallmark practice of corporate activism, Corinne Purtill of the New York Times points out that “words matter because consumers and potential employees are paying attention to whether companies keep their promises”. This expectation is clear: public letters are not only something to be signed, but delivered on.

Money Talks

Campaign finance, shaped through various cases argued before the United States Supreme Court, is often seen as the source of corporate political influence. This legal history prompts a range of arguments about corporate personhood: to what extent do our human rights apply to corporations? In short, they are free to speak and donate money in ways similar to you and me.

Following the January Capitol Hill riots, all eyes were on corporate spending habits. Campaign donations to lawmakers waned. Some companies paused donations altogether to review their expenditures; since that review period, this group has resumed donating to GOP lawmakers who objected to certifying the 2020 presidential election.

Nonetheless, stakeholder interests can be influential. Take Toyota, who stopped its donations to GOP objectors in July 2021 “after listening to its stakeholders who were troubled by the donations”. Several companies made and have maintained pledges to abstain from donating to certain groups, too.

Ask and You *May* Receive

At its best, corporate activism can embody stakeholder values and serve as a unifying force, not a divisive one. The key trait here is responsiveness, which companies have refined during the pandemic.

Recent corporate approaches to mental health illustrate this consideration. During summer 2021, Athleta launched a digital female empowerment platform, harnessing surging customer interest in opening up conversations on mental well-being and health. How about Bumble? It’s new biannual company holiday policy responds to employee stakeholders and burnout by building an avenue to recalibrate.

Advocacy for social change- whether it be policy enactment, expanding dialogue, or changing stigmas- can amplify stakeholder interests when done right. Corporations have many tools to steer greater outcomes in society, and channeling activism is at the forefront of this awakening.