General Interest

Elephant in the room: Should your company take a stance on social or political issues?

Written by
Maggie Leung
Consultant

Companies used to avoid taking a stance on social or political issues in fear of upsetting their stakeholders. In the past few years, however, the world has changed so rapidly that completely avoiding the discussion has become more difficult and costly. Social movements like #MeToo and Black Lives Matter put companies under pressure to speak up and take a stance on the issue, and the Russian invasion of Ukraine is an example of how staying silent is sometimes not even an option.

It’s apparent people now expect companies to be more vocal about controversies. Nine out of ten consumers in Asia want brands to engage in social issues, while  70% of US consumers expect the same, showing that most of us expect brands to engage with social issues; it’s no longer a bonus. Internally, the pressure is similarly high if not higher, as employees have the same expectations of the companies they work for. A Gartner study of over 30,000 people worldwide found 87% of employees agreed that companies should take a position on societal issues related to their business, and 74% agreed even when the topics aren’t directly relevant. These findings show the benefits of taking a stance – driving customer and employee satisfaction – but there’s more to it than that.

Creating a brand culture and attracting the like-minded

Brand culture is not only made up of branding visuals, but also a company’s values and the public activities that align with them. Multiple surveys have shown that younger generations,  millennials and Gen Z in particular, are strong believers in values, and a majority of them are willing to align their spending and career choices with companies that represent their beliefs. This makes communicating your company’s position a powerful tool for attracting like-minded consumers and employees in the future, and forming a driving force for the business.

Patagonia is a great example of how a company can establish a strong presence by engaging in social issues. The brand launched one of the most outspoken campaigns for a clothing brand against climate change deniers and has been calling out politicians publicly on social media. The advocacy may not win love from everyone but it has helped Patagonia become top-of-mind for eco-conscious consumers and workers. The 9,000 applications for every internship position at Patagonia also illustrate the huge potential for companies to attract value-driven employees who tend to have higher levels of discretionary effort at vocal companies.

Backlash and the perils of polarisation

The consequences of weighing in on social topics like sustainability and diversity are usually positive but not every issue has such wide appreciation/acceptance. With the world becoming morepolarized, amid heightened geo-political tensions, there is an increased risk of backlash. Western fashion brands that refuse to use Xinjiang cotton due to human rights abuses gain support from customers and employees at home, but face boycotts in China.

Companies have to prepare for the potential backlash and be ready for the impact of social-political issues. This also applies to brands that decide to avoid speaking up about issues, because to some audiences, refusing to take a stance is a stance itself. There are also people who will knock at your door and demand a position, a phenomenon we see from the recent Russia-Ukraine invasion. Even if your company hasn’t yet faced with a decision to weigh in on a contentious topic, you may find yourself under the pressure to make such a decision in the future.

Finding the line on how and when to speak up

The real challenge isn’t whether or not to take a stance, but how and when to do so. Before jumping on the bandwagon, you may want to ask yourself a few questions.

  1. Does the issue align with your business values and culture?
  2. What’s your company’strack-record  with the issue?
  3. Can you make an impact by speaking out? Are there actions to support your words?
  4. Do your stakeholders (consumers, partners, investors, employees etc.) agree with your decision?
  5. Are you able to convey a clear message to your stakeholders?  

This article will be way too long if we deep dive into each bullet point, but they all center around two elements: authenticity and transparency. If joining the debate can reflect your company’s values and culture, you may consider going for it. However, always remember that your audiences aren’t fools and they are empowered by social media. Your brand may face more scrutiny than support if you’re (or the public think you’re) attempting to simply capitalise on an issue and have no real actions to back up your stance. It’s crucial companies take a stance for what they truly believe in, and have a clear message with ongoing actions and communications that align.

For brands that are trying to expand their market overseas, this needs extra careful consideration.  Asia is known as one of the most diverse regions in the world, due to the vast range of ethnicities, cultures, demographics, stages of development and political positions  among countries. For brands that are unfamiliar to the sentiment of a new market, consider collaborating with third parties, such as research groups and local communities, instead of jumping right into a heated debate. You may also want to consider speaking with those who wanted to be engaged in the first place, then slowly expand your circle of influence.

All companies are on a steep learning curve as the expectation of corporate responsibility is redefined. There isn’t a guidebook that can guarantee success, but one thing is certain: social or political issues can no longer be ignored, no matter what the strategies are. Completely avoiding the discussion is no longer an option, and companies that are able to navigate the uncertainty and genuinely lead with their values and culture will have a higher chance of success.

Written by
Maggie Leung
Consultant