Increasingly corporations are being asked to comment on social and political issues. This raises a host of questions that the company needs to purposefully think about.
There are many constituencies who are asking a company’s CEO and leadership teams to comment on a wide array of issues.
Employees, customers, and investors may or may not want insight on a company’s philosophy and stance on high visibility issues.
The social concept of a corporation really came to the forefront with the death of George Floyd as well as subsequent major issues. This triggered deep focus on DEI and forced companies to focus and ask themselves if they really understood the black American experience.
Another recent issue has been the war in Ukraine, companies were expected to take a stance by employees and other stakeholders and publicly state whether they would continue to do business with Russia.
Another hot button topic corporations have had to contend with is Roe v. Wade.
Boards have to ask themselves what the upside of opening Pandora’s box of political division by commenting on highly charged social /political issues is?
It is more important than ever to take the time to have a deep internal discussion with the CEO, leadership team and boards to create a framework and policy on when and if the company will comment. This allows for a thoughtful approach without the emotion of feeling like you must respond the moment there is a big issue in the news cycle.
When considering whether to comment on a particular topic, ask yourself:
– Is this core to your business?
– Which constituencies are most activated / impacted by this issue?
– Is this an issue that pertains to company policy, employees, customers, investors, or some material aspect of the business? Or is it an issue of personal politics?
– How divisive/polarizing is the issue?
– Is it mandatory or optional to comment?
Companies such as AmazonAMZN -1.4%, Yelp, JPMorgan, Dell have responded to Roe V. Wade by quickly expanding healthcare benefits for employees. Some companies are upgrading insurance plans to cover contraceptives and allowed for Flexible Spending Accounts to pay for reproductive health procedures.
Interestingly, according to the Conference Board, only about 10% of companies have taken a public position on this issue whereas about 51% of companies surveyed made an internal announcement. Companies need to think carefully about which issue requires an external public announcement vs an internal statement to employees.
Consider, is there more upside vs downside if your company were to comment on an issue? Create a balanced view of your different constituencies: customers, employees, investors.
Certainly, since the Business Roundtable 2018 landmark statement by the largest fortune 500 companies that they were moving from shareholder centricity to stakeholder centricity, the role of the corporation has been evolving.
However, may be wise to remember that pioneers often get the arrows in the back. Being a fast follower may be an alternative strategy to being out front. You must be mindful about what is appropriate for your company’s brand when considering whether to make a public or internal statement.
Silicon Valley companies who are often well-known names and are always in the news cycle are uniformly highly communicative on taking positions on social issues as they are deeply focused on their employee cohort who is highly energized around social issues…but keep in mind that the mandatory need to give a response for a Silicon Valley company may or may not be an appropriate reaction for your company.
There really is no clear absolute right answer but having the discussion before there is a hot button issue that arises and clarifying the parameters for when and if the company will comment in any way is important.
One of the most difficult things in this highly engaging discussion is to separate your own personal politics, preferences, and passions, from what should be a corporate policy.
When in doubt, go back to your company’s initial statement of values and remind yourself of the mission, vision, and purpose of your company.