How corporate CEOs found their political voice—commentary


When I first began studying the interactions between social movements and corporations in the 1990s, it was rare to see business take a public stand on social issues. Yet today we see organizations ranging from General Electric to the NCAA weighing in on, for example, transgender rights, something hard to imagine even a decade ago.

Traditionally, corporations aimed to be scrupulously neutral on social issues. No one doubted that corporations exercised power, but it was over bread-and-butter economic issues like trade and taxes, not social issues. There seemed little to be gained by activism on potentially divisive issues, particularly for consumer brands.

A watershed of the civil rights movement, for example, was the 1960 sit-in protest by students that began at a segregated lunch counter in a Woolworth store in Greensboro, North Carolina, and spread across the South. Woolworth’s corporate policy had been to “abide by local custom” and keep black and white patrons separated. By supporting the status quo, Woolworth and others like it stood in the way of progress.

But negative publicity led to substantial lost business, and Woolworth eventually relented. In July, four months after the protest started – and after the students had gone home for the summer – the manager of the Greensboro store quietly integrated his lunch counter.

In general, companies were more worried about the costs of taking a more liberal stand on such issues, a point basketball legend and Nike pitchman Michael Jordan made succinctly in 1990. Asked to support Democrat Harvey Gantt’s campaign to replace segregationist incumbent Jesse Helms as a North Carolina senator, Jordan declined, reportedly saying “Republicans buy sneakers, too.”

And companies presumed that taking controversial positions would lead to boycotts by those on the other side. That’s what happened to Walt Disney in 1996 as a result of its early support for gay rights, such as “Gay Day” at its theme parks. Its stand prompted groups including America’s largest Protestant denomination, the Southern Baptists, to launch a boycott, calling Disney’s support for gay rights an “anti-Christian and anti-family direction.” The eight-year boycott, however, was notably ineffective at changing Disney policy. It turns out that too few parents had the heart to deny their children Disney products to make a boycott effective.

Since then, some of the biggest U.S. companies have taken similar stands, in spite of the reaction from conservatives. For example, when the Arkansas legislature passed a bill in March 2015 that would have enabled LGBT discrimination on the grounds of “religious freedom,” the CEO of Walmart urged the governor to veto the bill.

Not surprisingly, given Walmart’s status in the state and the corporate backlash that accompanied a similar law in Indiana, the governor obliged and eventually signed a modified bill. That didn’t sit well with Louisiana Governor Bobby Jindal, however, who argued in The New York Times that companies in those states were joining “left-wing activists to bully elected officials into backing away from strong protections for religious liberty.” He warned companies against “bullying” Louisiana.

Why have corporations shifted from “abiding local custom” around segregation and other divisive social issues to “bullying elected officials” to support LGBT rights?

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