Speaking Up and Out in 2022 and Beyond
Date: April 6, 2022
The bar for corporations to behave morally is higher than ever. This year’s Edelman Trust Barometer report—a survey of 36,000 people in 28 countries—finds trust in all organizations is changing, but business remains the most trusted (61%), followed by trust in NGOs (59%), government (52%), and media (50%).
Just as protests after George Floyd’s murder forced companies to review their position on speaking out on social issues, the invasion of Ukraine is putting a new batch of CEOs on notice that silence is not an option. CEOs can gain trust by speaking up and out on issues of social importance to employees, customers, and suppliers. But getting it right is critical: there is little room for error in the court of public opinion.
In his 2022 letter to CEOs, Larry Fink of Blackrock strikes a similar tone, “It’s never been more essential for CEOs to have a consistent voice, a clear purpose, a coherent strategy, and a long-term view. Your company’s purpose is its north star in this tumultuous environment.”
Business wields increasing influence, whether wanted or not. Which is why Chief Executives for Corporate Purpose (CECP) encourages companies to identify issues that matter most to them, speak out when appropriate, and take action to make a tangible impact. Building on similar work last year and experience with its 220+ leading companies, CECP has developed a framework through which CEOs and their teams can assess why, when, and how to take positions on social issues by identifying five questions for CEOs and their teams to consider.
- Does the issue align with your company’s strategy?
- What’s your WHY behind your strategy?
- Will your stakeholders agree with you?
- Seize opportunities to show impact
- Don’t be afraid to take bold stands
Does the issue align with your company’s strategy?
When deciding to become involved in a controversial social issue, companies should engage with humility, vulnerability, and enthusiasm on issues and in ways that are most relevant to the organization.
Rosalind M. Chow, an associate professor of organizational behavior and theory at Carnegie Mellon University’s Tepper School of Business, recently said, “Companies should be looking to their values/mission [and purpose] statements to determine if a given policy/social issue is relevant. If it is, then it makes sense to speak to it. If it’s not relevant, then they are taking on potential risk that may not make sense.”
What’s your WHY behind your strategy?
The market is putting pressure on all industries to do the right thing. Business leaders and CEOs need to realize this does not mean “more” or “nothing”, but instead requires a radical rethinking and a focus on what matters.
Former Unilever CEO and author of “Net Positive” Paul Polman says, “Leaders must have courage to do the harder right, not the easier wrong. And this will likely mean collaborating with competitors, critics, as well as politicians and civil society to address the big, systemic challenges that cannot be solved alone.”
Companies and leaders are speaking out against discrimination and bias, but CEOs may want to carefully consider the responsibility of speaking publicly about other issues and how it impacts the various stakeholders they work with.
Will your stakeholders agree with you?
While a few investors lash out at corporate activism, many companies feel the pressure to speak up—particularly from staff. Almost two-thirds of employees say companies should take a public stand on issues in the abovementioned Trust Barometer study.
And it’s not only employees asking companies to speak up more. A report by Public Affairs Council, the Washington-based association for public affairs professionals worldwide, found 90% of mainly US companies had experienced more pressure from all stakeholders to engage in social issues.
To determine what is best to speak about, consider following these guiding questions from IBM: is the issue directly linked to the business? Does the company have a history of engaging on it? What are the stakeholders (e.g., employees, clients, and shareholders) saying? What are competitors doing? Could the company make a meaningful difference by engaging?
Seize opportunities to show impact
The corporate push to embrace ESG (environmental, social, and governance) principles, along with demands for transparency, are turning up the heat on companies to both contribute and demonstrate impact. Like the recent U.S. Securities and Exchange Commission (SEC) announcement about proposals for climate disclosures for U.S. public companies.
Organizations need to be ready to back up promises with real investments that are as tangible as they are earnest, including donations of cash, donations of product, donations of employees’ paid time, and action through daily business practices. These types of contributions continue to grow over time. CECP’s Giving in Numbers™ report found that non-cash contributions experienced the highest recorded increase in median dollar value among all funding types (93%) in the last five years from US$4.8 million in 2016 to US US$9.2 million in 2020. Measuring impact with data helps companies demonstrate the value the organization brings to all stakeholders and society.
Don’t be afraid to take bold stands
While making bold stands is risky, holding back is even riskier. And when taking those stands, do not afraid of pushback. In the current shifting landscape, companies are on a steep learning curve working to prioritize responses and formulate best practices for communicating these views. This may likely create backlash from a few, but one thing is certain: not engaging in political, social, and moral issues is no longer an option.