Written by Rebecca Jaremko Bromwich
Elie Wiesel famously said in his 1986 Nobel Prize acceptance speech that “we must take sides; neutrality helps the oppressor, never the victim.” I tend to agree that it may indeed be morally imperative for human beings to take sides in times of crisis. Corporations, however, are not human beings.
As distinct from natural persons, incorporated companies cannot vote in elections. They have many of the aspects of personhood under the law but are not political citizens. The fictive personhood of corporations breaks down when matters of conscience and opinion are considered. There are many people within corporations, people with diverse opinions, identities, and interests. Corporate social responsibility is not the same as corporate political speech.
In the current geopolitical moment, corporations are quick to speak politically, taking political positions in service of a particularly showy understanding of corporate social responsibility. However, it may be wiser for companies not to throw around political rhetoric so casually. I would recommend, in fact, that businesses more often focus on their core mission. General LinkedIn and Twitter statements about political issues are overabundant, and, more often than not, serve no effective business purpose.
We live in a time of sloppy hashtags and social media pile-ons. Rhetoric is at a fever pitch on multiple sides of many conflicts, whether with reference to American electoral politics, gender issues, racism, or war in Ukraine and the Middle East. Too often the media cycle, and social media fervour, lacks nuance.
This is a reminder that, even if it is morally incumbent upon us to personally take sides, it is both possible and morally defensible for companies not to involve themselves, their communications departments, or their operating budgets, in political speech. It is possible, desirable, and strategic from a business management perspective, not to engage in making overt political statements unless there is a very specific aspect of the fundamental work of the company that aligns with the statement being made.
There are several motives why businesses may choose not to make political statements. Consider the following reasons:
Focus on core mission: Businesses often prefer to focus on their core mission, which is to provide products or services and generate profits. Distracting from this mission with political statements can divert resources and attention from business goals.
Risk of alienating customers: Taking a political stance can polarize your customer base. A statement that resonates with some customers may offend or alienate others, potentially leading to a loss of sales and customer loyalty.
Legal and regulatory risks: Depending on the country and industry in which they are operating, businesses may face legal and regulatory constraints on political involvement. Campaign finance laws, lobbying regulations, and other legal restrictions can limit a company’s ability to engage in political activities.
Lack of expertise: Businesses are not inherently experts in political matters, and taking a stance on complex issues without a solid understanding can be risky. It may lead to misinformed or poorly executed statements, potentially damaging their reputation.
Employee division: Making political statements can create internal divisions among employees, which can negatively impact workplace cohesion and productivity. Employees may have diverse political beliefs, and taking a stance may lead to tension and conflict within the organization. When businesses take certain political stances, some of their employees may not just disagree but may feel unsafe in the workplace. Reckless political speech may in fact violate worker human rights.
Short-term versus long-term impact: Political statements may have immediate consequences, but they can also harm a company’s long-term interests. Businesses may prioritize their overall stability and growth over short-term political gains.
Consumer skepticism: Some consumers are skeptical of businesses that engage in political activism, viewing it as a form of “virtue signaling” rather than genuine commitment to a cause. This skepticism can erode trust in a company’s motivations.
Shifting political landscapes: Political opinions and landscapes change over time. A stance that was popular or aligned with public sentiment when it was made may become obsolete or even counterproductive in the future, putting a business in a difficult position.
Lack of consistency: Maintaining a consistent and coherent political stance can be challenging, especially if the company operates in multiple markets with diverse political landscapes. Inconsistencies can lead to criticism and accusations of hypocrisy.
Reputational risks: If a business takes a political stance and is later linked to controversial or unethical activities, its reputation may suffer. This can result in accusations of double standards and further harm the brand. Further, a business can be seen as cynical or opportunistic if its political statements are received as inauthentic or performative.
As I discuss in my 2023 textbook Corporate Social Responsibility and Law: A Handbook, while it is a good investment for corporations to be mindful and intentional about the impact of their work on their communities, the environment, and their staff, companies should avoid simplistic and overly eager responses to political rhetoric, media cycles, and social media campaigns. While there may be issues of direct relevance to a company’s core mission, there are valid reasons for businesses to avoid making political statements in general. Corporate social responsibility is not synonymous with an obligation to engage in corporate political activism.
The views and opinions expressed in the blogs and case reporter are the views of their authors, and do not represent the views of the Desautels Centre for Private Enterprise and the Law, the Faculty of Law, or the University of Manitoba. Academic Members of the University of Manitoba are entitled to academic freedom in the context of a respectful working and learning environment.