When the nation was riveted by protests over police killings, should companies have added their voices to the discussion? Should every company have an official and public position on sustainability?
Questions like these are arising with increasing frequency, as companies find themselves under pressure — from employees, customers and the community at large — to speak out on issues that some might consider political. To answer them, companies need to evaluate whether to respond to an issue, what form the response should take, and who should deliver it.
“Social issues and political issues often intersect, which is why these issues are complicated,” says Sara Brady, a specialist in crisis communications and reputation management.
Businesses have long advocated for positions on political issues directly related to their operations, taking stands on trade agreements or regulations that would affect their performance, for example. But, increasingly, some are making statements and taking actions on issues such as climate change, diversity and even the political polarization of society.
On climate change, for example, employees and customers are becoming more likely to demand action, and companies have also realized that it will have an impact on their business, even if that impact isn't immediate.
“There's no question that employees are much more interested than even five years ago in seeing their employer take meaningful public stands on what they perceive to be societal or social issues,” says Cheryl Fields Tyler, CEO of Blue Beyond Consulting.
One driver of this change may be a breakdown in trust in other institutions. The 2021 Edelman Trust Barometer, which gauges trust in institutions, found that business was more trusted worldwide than government, non-governmental organizations (NGOs) or the media.
“Numerous studies show that employees want their companies to speak out on issues that matter,” says Valerie Di Maria, principal of the10company, a strategic marketing and communications firm. “The days when companies and CEOs remained silent on the controversial news of the day are basically over.”
Factors to consider when evaluating political speech
Most of the responsibility for decisions about communication on social or political issues rests with the CEO and the executive team.
“They may ask the board's perspective and advice, but the board is not dictating to the company what they should say and when they should say it,” says Shellye Archambeau, who serves on the boards of Verizon, Nordstrom, Roper Technologies and Okta Inc.
Unless the situation involves a crisis within the company, boards don't make the decisions on corporate communication plans. However, the board should be kept in the loop about major statements.
Advisors suggest a number of considerations for company leaders deciding how — and when — to speak out:
Choose issues carefully. It's important for a company's message to be authentic — and that means choosing when to speak and when to stay silent.
“I don't think any company should be speaking out on everything,” Di Maria says. “It would be too much, and not necessarily authentic.”
Instead, the company should consider factors such as the magnitude of the issue, as well as the concerns of the company's internal and external stakeholders.
“There's no absolute, correct answer,” says Brady. “Each organization is different.”
The company's values and goals can be good guideposts when deciding what to say.
“When a company speaks, it needs to be consistent with the overall strategy and the company's values,” Archambeau says.
Consult internally. The decision to speak out rests with the CEO and the executive team, who should be sure to consult with both the communications/public relations staff and with the legal team.
The communications team can help game out the possible outcomes of different statements, Brady says.
Although there are no blanket rules about when and how a company can issue statements about issues that could be construed as political, there are some scenarios where the legal team may urge caution. For example, if a company promises in a statement to change its hiring or promotion policies to be fairer to non-white applicants, that could be construed as admitting that the previous policy was discriminatory.
Internal consultations should also include employees, particularly groups who are interested in a given issue.
Consult externally. Assuming there is enough time, it's important to consult with representatives of as many stakeholder groups as possible, including customers and partners.
“Each company is different,” Archambeau says. “But companies will speak consistent with their strategy and approach to supporting their shareholders, employees, customers and community.”
These conversations should include members of the groups most affected by the statement the company is going to make. If the company is considering a statement in support of Black Lives Matter, for example, Black stakeholders should be among those consulted.
Consulting diverse groups of stakeholders often means companies will get varied — even conflicting — responses.
“You can't please everyone,” Di Maria says. “If you're going to take a stand, you might alienate some people. Just know that that's going to happen and weigh the risk versus reward.”
As with board members, it's crucial that no key stakeholders be caught off guard. It's important to be sure a major customer, for example, is not surprised by an environmental announcement that could affect them.
“Whenever companies are about to take a public stand, you need to be sure you have managed those stakeholder relationships,” Fields Tyler says.
Select a spokesperson. The CEO is ultimately responsible for the company's message, and having the CEO make a statement helps emphasize how seriously the company takes an issue.
“Typically, it is the CEO that ultimately has to own the message and has to be able to deliver it, internally and externally,” Fields Tyler says.
It may sometimes make sense for an executive who isn't the CEO to take the lead on communications, either because the issue relates to that person's area of the business or because they have a personal interest in it. Additional executives may comment after the CEO's initial statement, but a statement from the CEO carries significant weight.
“The CEO is the voice of the company on really important matters, and in most instances the initial comment should come from the CEO,” Di Maria says. “Otherwise, it doesn't sound like the company is taking it that seriously. It doesn't mean that the CEO has to be the only spokesperson.”
Articulate the position clearly. “If what you say creates more confusion than it does clarity, that's a waste,” Archambeau says. “It will then require more effort, because you've got to go back and clarify again.
“The stronger the strategy is and the clearer the strategy is, typically the easier it is to communicate it.”
In addition, a statement that sounds bureaucratic, as though it was crafted by a committee intent on not offending anyone, likely will not earn any goodwill. Effective statements should “come from a place of empathy and understanding,” Fields Tyler says.
Be prepared for possible fallout. Sometimes a company's statements about an issue create unintended controversy or anger some stakeholders. How to fix the problem will depend on the situation.
The best course of action may be “standing by your decision and accepting that people are mad, and hopefully they'll get over it,” Brady says. Other times, it may be apologizing and changing course.
It's important for companies to have teams in place to help with decisions like this — ideally, to anticipate and avoid problems before the statement is made, but also to deal with the aftermath if something goes wrong.
Follow talk with action. Many of the employees, customers and other stakeholders who demand statements from companies on issues like LGBTQ+ rights and global warming do not simply want to read about the company's position. They want to see the company doing something that supports its statement.
“You can't just talk about things,” Di Maria says. “You have to have an action plan. If you're just opining, that's not going to sit too well.”
For example, a company makes a statement in support of Black Lives Matter protesters. But what is it doing to address the underlying societal issues protesters are bringing to light?
“The action piece of it is very, very important,” Di Maria says. This is another reason for companies to choose carefully when to make a statement — it's very difficult to take meaningful action in every area.
“The biggest pitfall is to talk and have no plan or no action. People see that as almost being disingenuous. If you're going to really take a stand on an issue, you have to answer what your company is going to do about it.”
A longer-term goal for many companies is to tackle social and political issues in a way that's proactive rather than reactive.
“You should have a cross-functional team that looks at the hot issues: how women are treated in business, how Blacks are treated, what's happening with sustainability and the environment,” Di Maria says. “These are ongoing issues.”
The team could include people from marketing, communications, strategy, HR, legal and perhaps functions like supply chain management. Media training for top executives can also help make the company's statements and actions more effective.
These efforts could help companies get ahead of some of these issues and even take a leadership role. When news breaks, the companies that are already discussing these issues will be best positioned to address them in a careful, effective way.
“This is what leaders need to think about: What are you doing with the moral authority and trust and power that our society is investing in business leadership?” Fields Tyler says. “It is important to take a stand, but it's even more important to walk that talk.”
Margaret Steen is a freelance writer in the San Francisco Bay Area focused on business and technology.