(Photo Credit: Emara Saez/Piktochart/Achona Online)
Following the wave of restrictive voting laws that have been sweeping the country, companies like Coca-Cola, Microsoft, and Delta have come out declaring their opposition to infringing on the voting rights of minorities. Corporations were not quick to denounce new voting restrictions, but rather were reacting to the backlash they received from their consumers. This begs the question: what are the motivations of corporations advocating for social issues? While these efforts may seem noble at first, they reflect a concerning trend in the corporate world: the capitalization of social issues.
This trend is not a new one. In recent years, corporations have been chiming in on all types of social issues ranging from LGBTQ+ rights to the Black Lives Matter movement. The common actions that corporations take typically involve releasing a statement, promising internal changes, or posting on social media.
I hope Sonnenfeld is right, but I suspect much of this corporate activism is not grounded in principle. Rather, I suspect much of this is performative. https://t.co/2mmDHCDgDn
— Hal Marshall (@HalMarshall2309) April 12, 2021
This type of action by large companies surrounding hot-button social issues is known as corporate activism; on a larger scale, it can be categorized under bandwagon activism in which a group or entity decides to support an issue after it has been widely accepted by the masses.
“Corporations can make activist claims if they would like, but it means little to nothing if they don’t act upon their words. If companies make a claim but don’t take direct action against an injustice they denounced then it is clear their interest in fighting the issue is superficial and that they only want to increase the popularity of their product,” said Isabella Ruano (‘21).
Two examples of this type of bandwagon activism can be seen around pride month and the Black Lives Matter movement. For example, after the death of George Floyd in May 2020, brand after brand released messages in white text on a black background reiterating the same message of “We stand against racism,” “We stand for inclusion,” “It’s time for change,” and so on. Similarly, during pride month, many companies change their branding to rainbow colors in support of the LGBTQ+ community, but refuse to support the LGBTQ+ community the minute that pride month is over.
These types of lackluster, hollow messaging tactics leave consumers feeling as though the words and actions of brands are performative, and that brands are doing them solely because they feel it is expected of them. In many cases, this is the truth for all acts of corporate activism.
“I think a lot of times corporate activism isn’t concrete enough to really help with social issues. Most of the time it’s just an executive decision to not ‘get canceled.’ For example, tons of companies will use pride month as an excuse to mass-produce tons of different things with rainbows and slogans on them. Most of the time the products don’t come in tandem with donations to non-profits that support the community or even information about the cause. Actions like that and phrases like ‘we stand against racism’ are nice but are such a low bar for advocacy,” said Madison Kwo (‘23).
While corporate activism may bring awareness to social issues and allow consumers to prioritize ethical consumption, the cons of corporate activism far outweigh the few pros. The fact of the matter is that many of these social issues are beyond the “bring awareness” phase, meaning they would benefit more from actual activism rather than meaningless efforts by corporations to “raise awareness.”
“Since large corporations usually have more power and money than real activist movements, they most likely overshadow the activists who have a deeper knowledge on the injustice at hand,” said Ruano.
Brands want to be perceived as ethical, socially aware, and empathetic in order to drive up profit margins. While the transparency on certain social issues may help consumers choose which brands to support, the actions rather than the words of brands are what consumers should value in determining the ethics of companies they choose to support.
When choosing which social issues to be vocal about, companies engage in cost-benefit analysis. Ultimately, the benefits must outweigh the costs for a company to choose to be vocal about a certain social issue. Thus, corporate activism is often used as a branding and marketing strategy.
“Companies certainly take advantage of prevalent social issues as marketing tools. One example of this that immediately comes to mind is the Kendall Jenner Pepsi commercial on police brutality. Companies that engage in performative activism trivialize the real issue by reducing it to something as simple as handing a police officer a Pepsi to end police violence,” said Catherine Neumeister (‘21).
brands that use social causes for marketing do so to meat a bottom line. they calculate decisions based on the risk/reward ratio of advertisers, current audiences, and potential audiences. workers internally may truly care, but the decisions are ultimately based in self-interest
— Steak-umm (@steak_umm) October 28, 2020
By speaking out on social issues, corporations can portray themselves as socially-aware, cognizant brands, which will hopefully attract workers and customers. This is particularly true for companies making consumer products, as corporate activism can be incredibly valuable when people are promoting or discussing a company for free because of the company’s public stance on a certain issue.
For example, after Nike chose to release a series of anti-racist ads in collaboration with Colin Kapernick, the company reported a 10 percent jump in income to $847 million and stock ended the day of the ad release 7.2 percent higher at $72.37. Although Nike received some backlash from individuals threatening to boycott, the commercial benefits of releasing the controversial, viral ads outweighed the few risks.
Furthermore, companies have realized what a successful tool corporate activism can be, as 87% of Americans will purchase a product because a company advocated for an issue they cared about. For younger consumers, corporate activism is even more important, as 81% of millennials expect their favorite companies to make public declarations of their corporate citizenship.
While this trend has emerged because of the good-will of consumers, corporate activism is problematic because it capitalizes off of social movements and silences real activism by shifting the narrative towards profit over real human interest. These corporations will always prioritize profit over the interests of larger social movements, and they benefit from the labor of these social movements by using them as marketing gimmicks for profit.
Not to mention, the activist actions of corporations are typically hypocritical, as many corporations are willing to bend their activism depending on the time, place, and benefit received from their actions.
Honestly it’s ok when brands/team sports/etc come out in support of various social movements because it shows that public opinion is shifting but that doesn’t negate the fact that the people who own them often donate vast sums of money behind the scenes to prevent progress, lol.
— maybe: diane (@dianelyssa) April 14, 2021
For example, although Coca-Cola was vocal about opposing Republican legislation to restrict voting access in Georgia after receiving backlash, the company has been known to give hefty financial contributions to Republican candidates around the country and in Georgia. The company PAC donated $409.2k to Republicans in the 2016 cycle, so it is hypocritical for them now to vocalize opposition against Republican-enabled legislation when they as a corporation enabled Republican legislators by funding their political campaigns.
“Companies constantly participate in more subtle performative activism, such as ‘green-washing’ and ‘rainbow-washing.’ If a company wishes to advertise itself as ‘green,’ it must devote itself to sustainable practices within the business in such areas as production, resource consumption, packaging, and transportation. In promoting advocacy for the BLM movement, companies should financially support organizations like NAACP and Color of Change to indicate their dedication to the cause. Companies have to show—rather than tell—their commitment to creating real change,” said Neumeister.
Of course, if corporations choose to engage in activism, there are ways to make it more genuine rather than performative. Some tactics for promoting change through corporations include donating money to organizations directly involved with social causes, providing aid for lobbyists advocating for change, and fostering inclusive work environments by promoting employee recruitment and retention for a diverse workforce.
Corporate activism for social good vs. corporate profit? It's important to *walk* the talk. Before making a statement externally, make sure you take a look at the inside first. Are our words aligned with our actions? #PREthics20 #PRProfs #COMS325F20
— Dr. Fay Zifei Chen (@FayZifeiChen) September 17, 2020
If corporations embrace “hard activism” —like lobbying, donating money, or hiring diverse workers— in an honest way rather than “soft activism,” they can help activist ideas become mainstream. The key to corporate activism is honesty and transparency, which is often lacking within the current trend of corporate activism.
Consumers need to stay critical of corporations who engage in activism; by analyzing the motivations, end goals, and methods of corporations, a conscious consumer base can have considerable power over the actions of a company. It is always important to keep the bigger picture in mind when considering what a company does for society and its larger social responsibility.