Corporate Political Activism: What Corporate Responsibility Directors Need to Know

 

 

Social and political events of today are forcing many businesses to rethink their role in corporate social responsibility. For many years, the idea of taking a stand on a contentious political topic was off limits and risky at best for companies. Staying neutral and focused on brand and products was considered the responsible way to do business.

But today, consumers often want to know your brand’s position on current issues, says Daniel Korschun, Stephen Cozen Research Scholar and associate professor, Drexel University. And they are motivated when you are willing to speak out.

Korschun, who focuses on corporate responsibility and brand and corporate reputation management, was a guest on 3BL’s recent webinar, Corporate Political Activism: What Corporate Responsibility Directors Need to Know.

The April 10 webinar was sponsored by Corporate Responsibility Association and was chaired by Maureen Kline, vice president of public affairs and sustainability for Pirelli Tire, and John Friedman, sustainability manager at WGL.The prevailing wisdom, said Korschun, has always be that companies should remain neutral when controversial issues come up in the media. And in the past, that point of view served big corporations well.

But events in the last couple of years have demonstrated that the consumer’s expectations for companies is changing. Corporate involvement in movements like the WeAreStillIn campaign, which was endorsed by more than 900 businesses at the time of its launch, and the growing success of companies like Patagonia which kick-started a petition against the Trump administration’s effort to delist national monuments and parks were hallmarks to that changing attitude about how the “right way” companies should respond to political controversy.

Companies like Delta and Facebook, which have gone on record indicating that they would remain neutral in response to the Parkland, Fla. shooting and criticism against the National Rifle Association’s stance on the issue.

“That neutrality really backfired [on Delta]” said Korschun, who pointed out that while the company said it was distancing itself from the NRA by eliminating discounts to its members, the company was perceived as having conflicting views and actually taking a stand against the NRA.

He said this same conflicting message was heard by consumers when Dick’s Sporting Goods announced they would stop selling assault-style rifles.

"When they announced it, they announced as a way to stay away from the issue, noting that ‘we don’t want to be part of this story.’”
Since that time, Dick’s Sporting Goods has changed its message, with a press release stating that it supports more advocacy on the part of the gun manufacturer, Vista Outdoors, and is taking a stand against neutrality. Its current position has been mirrored by other outdoor sporting goods stores in the U.S. and Canada. Those stores have also recorded positive feedback from their customers for taking a decisive position on the unrestricted availability of assault-style rifles.

Political events and increasing polarization of consumer views are leading companies to realize that it’s no longer OK to try to evade taking a stand, said Korschun.

“The large overarching theme in my research is this is a new reality and for most of us in the CR field, it’s time to embrace this new reality.”

In fact new research into consumer buying trends suggest that some customers will be more apt to make incidental purchases if they know the store is a “value-oriented” company and consistently lives up to its values. According to Korschun, 22.9 percent of consumers in a recent survey said they made an unplanned purchase after learning the company they were about to visit acts on its values and had taken a position on a controversial, local issue. For other companies that were viewed as values-oriented but had chosen to abstain from taking a stand, the number of incidental purchases plummeted to 16.3 percent.

“Even people who disagreed with the stand … still make more purchases from the store.” And the reason for this, he said, is that “people find a values-oriented company that does not take a stand, that abstains, to be hypocritical.”

Korschun shared a number of tips that CR managers can use to determine the best approach to corporate responsibility for their companies, each reflecting new research about the way that consumers tend to view corporate advocacy in today’s marketplace:

• How advocacy at the point of purchase can be beneficial to your brand;


• Ways that companies can measure the anticipated response from consumers given your values-oriented approach;


• Lessons CR managers can gain from companies that are now shifting their approach toward advocacy and the benefit they are reaping from that change.

Korschun’s research has been published in more than a dozen journals around the world, including the Journal of Business Ethics, MIT-Sloan Management Review and the International Marketing Review. He is also the author of two books, Leveraging Corporate Responsibility: The Stakeholder Route to Maximizing Business and Social Value (Cambridge Univ. Press, 2011); and We are Market Basket: The Story of the Unlikely Grassroots Movement That Saved a Beloved Business (AMACOM, 2015).

Content like this is typically reserved for Corporate Responsibility Association members. To experience a preview of our thought leadership content, watch Dr. Korschun's presentation in its entirety here. 

Image credit: Screenshot