Since the Parkland, FL school shootings, people across the country are calling for action to prevent such future horrors. The government where citizens have traditionally looked for answers is a house divided and by the Founding Father’s design slow to act. In the face of mounting pressure and public outcry, corporations feel the need to fill the leadership void and take a stand.
In doing so corporations have moved from the safe corporate social responsibility world of clean air and water, food for the hungry, shelter for the homeless and support of the arts into the more dangerous realm of social and political activism. But venturing into the political arena can be dangerous for companies, especially in these politically and socially contentious times. Today it’s guns, tomorrow it will be something else.
Responding to the latest call, numerous businesses are answering it. Retailers including Dick’s, Walmart, Meijer/Fred Meyer and L.L. Bean have stopped selling guns to young people under 21 years and taken assault-style rifles off their shells. Other companies, like Enterprise, Allied Van Lines, Delta and United Airlines, have stopped offering discounts to National Rifle Association members.
In the wake of businesses distancing themselves from guns and gun makers, Federal Express decided to continue offering NRA member discounts and 2-day delivery for guns, saying to end these offers would be discriminatory. “FedEx has never set or changed rates for any of our millions of customers around the world in response to their politics, beliefs or positions on issues,” the company said in a statement. This caused an equal and opposite reaction among some Federal Express customers to find another company to do business with.
Not too long ago, companies would have steered clear of inserting themselves into such a divisive and politically-charged issue like gun control. Times have changed and corporate social responsibility is no longer just a “feel good” position companies take as a public relations gesture. Corporate social consciousness to act for the common good is now expected by consumers. Companies can’t just “talk the talk” any longer, they must “walk the walk” too.
In Fabian Geyrhalter’s new book, Bigger than This, he defines 8 essential qualities for companies and brands that want a deeper connection with customers. One of these qualities is Belief – where the companies holds values that are meaningful to its customers. He writes, “One of the biggest brand rules of all times is ‘Do not talk politics.’ Today it is a bigger risk not to speak up.”
Geyrhalter points to Austrian shoemaker GEA as an example of a company that not just takes a CSR stand on the environment and support of it workers, but publishes a political newspaper called Brennstoff (meaning Fuel) where GEA’s founder, Heini Staudinger, shares his opinions on matters of politics, faith and the economy.
“Being unafraid to exclude the many and to be extremely powerful to the few is what makes a true brand based on shared belief and values truly great,” Geyrhalter writes. “GEA is living proof that going against the grain and staying true to your personal beliefs, even if they are based on extreme political opinions (or religious beliefs), can be a powerful branding tool.”
To gauge the benefits and dangers of when corporate social responsibility veers into political action, I reached out to experts and opinion leaders in the field. Here is what I learned.
Corporations are required to take a stand
The business community is undergoing an ethical transformation, believes Patrick Quinlan, CEO of Convercent, a software company that helps 600+ companies manage compliance and ethical issues. Many companies are being forced kicking and screaming into the fray, as CEOs are being ousted “left and right” for ethical lapses, says Quinlan, pointing to Wells Fargo and Uber as prime examples.
“In the age of transparency fueled by social media, corporations are under extreme pressure to take a stance,” he says. One such stance is making ethical decisions about the products sold, such as guns at Dick’s or tobacco at CVS.
While Quinlan concedes that such politically-sensitive actions can alienate certain consumer segments in the short-term, he believes that companies that take action will benefit in the long run. “In today’s world, doing nothing more often puts companies at a disadvantage when it comes to long-term reputation and, ultimately, the longevity of their business,” he says.
No stand is actually taking a stand
Companies that remain on the sidelines in divisive issues are in effect taking a stand in support of the status quo , warns Stephen Elliott-Buckley, founder of Vancouver-based E-B Strategy that works with non-profits, social enterprises, co-ops and other organizations on organizational design and building stakeholder engagement.
“Brands that try to remain neutral, apolitical or non-partisan in an increasingly politicized environment are going to be seen as taking the side of the status quo, even if that default position comes from inaction. It is still a decision,” Elliott-Buckley says.
While companies may hesitate from taking positions on social issues for fear of alienating customers, the price of such indecision may mean these companies miss out, even alienate other segments of the market that place higher stock on values and principles. He warns, “Brands need to understand that remaining apolitical will increasingly be marginalizing. There are consequences for stubbornness.”
Social responsibility is everybody’s responsibility
Because the gaping political divide is creating government gridlock, corporations have a responsibility to step in and provide leadership on important social issues. With a resume that includes Director of Community Relations at Microsoft and Director Corporate Responsibility at GoDaddy and now founder of 11Eleven Consulting that connects communities, companies and causes, Tyler Butler believes corporate responsibility must extend beyond donating money or deploying volunteers. It must move the culture forward.
“Corporate social responsibility isn’t only about feeding the hungry and sheltering the masses, but it is also about companies making thoughtful decisions that will serve to transform our culture and also be a channel to transform humanity,” she says. “CSR is so much more than a photo opportunity or a perfect product curated to give back. It is a transformative decision that defines a brand and provides transparency as to what their true values are.”
Butler too believes the long-term benefits to corporations and its constituencies will far outweigh disenfranchising segments of consumers. Addressing Dick’s gun decision, she says, “Regardless of where you stand on the issue of gun control or other issues like it, this type of movement is a mark of great CSR and a company taking a position that might temporarily impede financial gains, but will ultimately gain them public favor in the long run by taking the lead for the betterment of society.”
Stand on issues, not on party
As a marketing consultant working with financial companies, Julia B. Mellon, Vice President, Financial Services at Bliss Integrated Communication, sees women and young investors basing investment decisions not just on financial returns but also on a company’s impact on the environment and society at large. That said, taking a corporate stand in favor of a candidate or a political party is fraught with danger.
“There is a very clear distinction today between adopting a bipartisan issue and speaking out in favor of a political candidate or party. However, as our country becomes increasingly polarized, more and more topics verge into controversial territory,” she says.
The key is for companies to be proactive on issues that are critical to brand and corporate identity, like a grocery store supporting local, sustainable farming or an outdoor adventure brand advocating for environmental conservation.
It can get sticky, however, when companies cross over into issues that align too closely with political party affiliations. “Brands should pick their moments and select platforms that resonate with their identities,” she advises.
Breaking news events propel once manageable CSR causes into crises where public outcry demands action, like the Parkland, FL shootings and #MeToo accusations. Companies can’t sit back and wait, but must anticipate things that can happen which will impinge on their business and their customers.
“It wasn’t that long ago that most companies could generally pick and choose their CSR issues and battles. Those days are over,” warns Michael Montgomery, who founded his namesake consulting company in 1989 to advise nonprofits and communities on fundraising and economic development.
While companies are facing guns, immigration and sexual harassment as the hot button social issues of the day, Montgomery sees healthcare, declining incomes and growing income inequality and race issues “waiting in the wings” for prompting events to put them back center stage. “There is no fence left on which to sit,” he says.
Know your now and future customer
Being prepared means companies must think in advance about ways the culture’s opinions can shift, increasingly at the speed of light through 24/7 cable news and social media. Professor of Marketing Practices at Texas Tech University, Dino Villegas says adapting to the rapid pace of change is tough for companies that once enjoyed the luxury of carefully crafting brand stories and messaging at their own pace.
“As the user-created content have become predominant in today’s social media, brands have had to adapt to that reality. They have to compete in real time with thousands of other stories and take extra steps to be able to distinguish themselves,” Villegas says.
To do that effectively in today’s fast-paced environment, brands have to understand the deep feelings and interests of their customers today, as well as anticipating how they might change in the future. “You must think about the fit of your brand with the customers, knowing that it may turn away other customers, but as long as it’s planned and you know the implications – and it’s in-line with the brand and corporate values – it’s going to be positive,” he affirms.
Make more friends than enemies
Unlike in the old CSR days when companies could choose their battles, today the culture wars are coming to them. Virtually no company is immune to critical social issues and potential consumer backlash when taking a stand. The key is to make more friends than enemies, but how to do that is increasingly hard to determine.
For example, Target which proclaims inclusivity as a core value was widely celebrated when it filed an Amicus Brief with the Supreme Court in support of marriage equality. But it may have moved too quickly toward inclusivity in its transgender bathroom policy, which brought an avalanche of bad publicity and 1.5 million signatures in support of #BoycottTarget pledge.
Rather than cave to its opponents, Target backtracked by announcing it will spend $20 million to install third, single-toilet options in all stores. With more careful consideration of all the constituencies it serves, Target could have been a hero rather than a pariah if it had originally planned single-locking bathrooms in all stores as its CSR stand on inclusivity to support its transgender guests’ and members’ needs.
Slow and steady wins the race
Some issues just by their very nature are widely perceived as a common good, like environmental issues, health and safety, hunger and homelessness, discrimination, harassment and disaster relief. Others as in the recent gun issue, immigration and corporate policies that can be perceived to violate an individual’s liberty and conscience, are much more difficult to navigate.
But take a stand, corporations must. To do so most effectively and profitably, companies need to look inward, what its broader mission is besides making money, how it touches peoples’ lives including customers, employees and the community at large, and what its responsibilities are to all. Then it needs to strike the right balance between where they are as a company and where their customers are today and where they are going tomorrow.
Moving more carefully and thoughtfully into social causes that may rapidly veer into political issues and controversy may be the best course in these divisive times. Small positive steps toward a greater common good, rather than giant leaps into hot-button issues, are the more prudent CSR course. Remember the fable of the tortoise and hare and who won that race.