Companies hold global wealth and power and, up until almost 20 years ago, they did very little to challenge political issues with the fear they might lose that wealth. But in this modern political climate, are huge companies helping to challenge the political playground or really just helping themselves?
An article titled ‘Why do companies get involved in social issues?’ written by the BBC starts by discussing the turning point of business leadership policies. The Oreo: once an American food icon; now a global powerhouse, started the ethical debate political debate.
Daryl Brewster, then president of Oreo, had a discussion with the board of US food giant Nabisco about the nutritional value or implications of an Oreo. His goal was to make the Oreo healthier. This was unheard of, why would you want to change something that had been selling so well and profiting shareholders?
A member of the board was very much against this, and was said to have said: “shut up and make the Oreos”.
In the end, Brewster made the changes and ensured that people were aware of what they were eating through more transparent packaging.
Companies now have a platform for their fundamental beliefs and we, the consumer, often talk about it. Social, political and ethical issues are all around us in 2022 with companies making statements on Twitter, giving us an insight into their political and moral compasses.
Mr Brewster, now the leader of Chief Executives for Corporate Purpose, says that “making money is “not the opportunity anymore”. He helps big corporations craft their messages.
“Companies need to think through those issues that are relevant to them… how they’re going to respond and maybe even take action before these become major issues.
Companies realise that to increase profits over time, they need to be good citizens of the world.”
Values have been tested and demonstrated very recently with the US Supreme Court’s restriction on abortion rights, and many big companies have spoken out against this decision.
One company leading the way is Yelp. As a company, they demonstrated an active opposition to this new law reversal, offering to pay for an employee’s travel for an abortion. Yelp’s chief diversity officer Miriam Warren has said: “Not only did we want to protect and safeguard our employees by creating a travel reimbursement, but we also recognise that our employees, our consumers and our customers were looking for us to be vocal on this issue.”
A survey by Pew Research Center found that 61% of US adults say abortion should be a legal while, 37% think it should be illegal. Warren has said “After the reversal of Roe v Wade several weeks ago, we have recognised the need to become even more vocal on this issue. And from that, we hear very frequently not only from our employees with notes of gratitude but also from people around the country and now even the world, on the stance,”
This isn’t the first time Yelp has stood up for what it believes in, having spoken out about transgender and LGBTQ+ rights, free speech and gun reforms.
Warren thinks that colleagues, customers and consumers are those most affected, she believes that if Yelp doesn’t show a clear social stance with such a huge platform to do so, they are missing a huge opportunity, not just for Yelp but on a social and moral level.
According to Edelman’s Trust Barometer, people feel that companies can positively influence important moral and ethical conversations, more so than governments and the media. Although of the 36,000 participants 52% responded by saying that capitalism does more harm than good.
Are companies jumping onto the band waggon of activism? Pride and Diversity Washing for more sales? Warren has said that activism is good for business, boosting profits, so why aren’t they all doing it? Warren has said “Many corporate actors are silent and potentially attempting to remain neutral. Frankly, I think neutrality is not going to be looked on favourably, particularly from a historic-looking lens.”
Some disagree with Warren, Paul Argenti, being one of them, has said “Sometimes it’s best just to say absolutely nothing, you cannot win,” Argenti, a professor of corporate communications at Dartmouth University in the US, has developed a framework for companies to use in order to know when and why they should speak up on particular issues. He believes that it is crucial to decipher what is important to the company, for its strategy, and when looking at the core context of what the company does.
His second point is for the companies to think about if they can actually do anything or if they will just be putting their foot in it. Finally, he says, “the last piece of it is how are your constituencies going to respond? Will most be positive about your decision, or will a significant and important constituent weigh in against you that might cause you more harm than good?”
Apple is a positive example of a company with an ethical voice. Tim Cook made it very clear that he was determined to tackle climate change and so went full force into building a reputable impact on his pledge.
Disney is, however, an example of a company that has had a negative impact from making a statement. It lost its special tax status in Florida after speaking out against the States “don’t say gay” legislation.
Unilever was challenged by Ben and Jerry’s for their decision to continue selling the brand in the West Bank, Ben and Jerry’s stated that it was “inconsistent with the brand values” due to Israel’s control of the area. Shareholders argued that Unilever was “putting profits over human rights.” Unilever explained that it was a “complex and sensitive matter”.
“Business has an opportunity, if not to find common ground, but to find a higher ground that society can move towards.
“Things like climate change and social justice are really critical issues where I think business can play a leading role in partnership with other businesses, in partnership with governments as well.
“But I think there is a void that we’ve seen in so many places, and businesses which are really serving the vast majority of our population really do have an opportunity and a need to really kind of step in on those key topics.”
When looking at the impact companies have had already on our society, it’s important that more companies follow an ethical foundation moving forward. This foundation will help companies to grow and develop within a positive, modern, sphere of capitalism. It is however important that the views and beliefs the companies are presenting are genuine of interest to the company, rather than an additional tag on to their manifesto. If the manifesto is false it will begin to crack and there is no longer room to hide.
It will be interesting to see the transformation of the global social hegemony with the help of large corporations’ advocation for inclusivity and environmental change over the next 10 years.
“We also recognise that our employees, our consumers and our customers were looking for us to be vocal on this issue.”
