Companies across industries are repeatedly and frequently taking public stands on social issues, particularly those affecting LGBTQ people, people of color and women. Sometimes the push comes organically, while other times it follows employee backlash or public outcries for action. That level of public activism can often be seen as doing the right thing, but there’s another powerful incentive for companies: It’s good for business.

“There’s a sense that these aren’t business issues and that companies shouldn’t get involved, but there’s a clear business case for it,” said Jessica Shortall, director of America Competes, a national coalition that works to oppose LGBTQ discrimination and advises companies on how to publicly or privately take action. “Everybody should be able to bring their whole selves to work. People who can’t do that are less productive and less likely to stay, and companies know that that’s true.”

“Everybody should be able to bring their whole selves to work. People who can’t do that are less productive and less likely to stay.”

Daniel Korschun, who researches corporate political activism at Drexel University, agrees.

“People want to see their identity as having a consistent core,” Korschun said. “When they work for a company that they believe is acting in a way that’s hypocritical, it becomes very difficult for them to be on the job. Netflix has been very vocal about its support for the LGBTQ+ movement, but employees are saying that the company isn’t reaching the bar that it’s set for itself.”

In one of the more recent examples, activists and workers at Netflix protested the platform’s decision to stream comedian Dave Chappelle’s latest special, which some argued was transphobic. Some of Netflix’s own stars and personalities supported the movement. Hours before Wednesday’s walkout, co-CEO Ted Sarandos acknowledged that he had “screwed up” in his initial response to employee criticism.

Sarandos’ public mea culpa isn’t unique. It’s part of a broader tendency by executives and companies to outspokenly promote inclusivity within their workforces — and also own up to any missteps. It often coincides with discriminatory national or state legislation aimed at LGBTQ people, women and people of color.

“Businesses are now speaking up on abortion legislation, critical race theory bans, voter suppression, trans issues,” Shortall said. “They’re saying: ‘This is real for us. We are losing employees in states that pass discriminatory bills. It’s causing us genuine problems in our workforces.’”

Shortall noted that many companies have long had progressive internal policies to prevent discrimination in hiring practices and workplace culture. But she cited several high-profile examples of companies that have taken public stances denouncing discriminatory legislation, including Indiana’s 2015 religious freedom law and North Carolina’s 2016 law limiting bathroom access for transgender people.

“There was concern about sending employees to meetings and conventions in states where they could be turned away at a restaurant or bathroom,” Shortall said. “All of that came into play and influenced companies to go beyond their four walls into the public sphere. If people feel they can’t be safe, that’s a problem for an employer.”

Shortall and Korschun noted the role that social media has had in company activism, as well as the impact that changing employee attitudes have had.

“We’re in a really tight market for talent, and we have folks for whom this is an important value set,” Shortall said. “Companies have got to hold the line on these policies.”

Korschun said workers are also paying attention to what other workforces are doing and accomplishing.

“They’re getting encouragement and thinking, ‘I can have a real impact on the way my company is running,’” Korschun said. “Employees have a greater sense of ownership than they have in the past. They feel they’re giving a lot, helping their company prosper, and they’re expecting to be listened to in return.”

But for all the high-profile examples of company activism, there’s still trepidation among some.

Christine Moorman, a professor of business administration at Duke University, annually conducts “The CMO Survey,” which tracks the opinions of top marketers.

Her survey found that from 2018 to 2020, there was little change in how marketing leaders responded to the question “Do you believe it is appropriate for your brand to take a stance on politically charged issues?” In 2018, only 17.4 percent of respondents said yes. In February 2020, the number had risen to only 18.5 percent.

There were some notable outliers: 44 percent of bigger companies, defined as those with annual sales revenues over $500 million, responded “yes.” Of the companies that made more of their sales revenue online, 26 percent responded “yes.”

However, there are signs of change. While it’s still a minority of respondents, the number of executives who thought it was appropriate to take such a stance increased to 27.7 percent this year.

[Read More…]