Corporations, cornered
Those which pivoted to social purpose are now looking for a way out
It’s no secret that employees are in revolt today. Whether it’s over salaries, benefits or the social, political and environmental causes they want companies to champion, the relationship between some companies and the people who work for them is becoming downright strained.
According to a new global survey of employees just released by Deloitte, employee activism is rising. Since the pandemic, there’s been a 40% increase in employee-led activism at workplaces across America, with mostly younger employees stepping up their pressure on their employers to support more complex issues also important to them—from guns to abortion.
Trouble is, say some businesses, many of these new employee demands are becoming more outsized, with some too numerous, too costly or simply too high-stakes and off-brand to deliver.
Pressure to gain more, though, is growing. The increasingly powerful wave of employee-led cause activism is moving parallel to the recent resurgence of labor union organizing activities—not just for social causes, but mostly for increases in employee benefits at Fortune 500 companies such as Amazon and Starbucks. Activism by white collar workers, engineers and tech workers at companies like Apple and Walt Disney Co. sought to stop company efforts during the past two years to make workers return to the office more days than not—and the famous Hollywood writer’s strike stopped studio executives from using AI to make digital avatars of actors using their voices and images without compensation. Last year, Amazon corporate workers went beyond signing a petition to stage a walkout of about 900 corporate workers in Seattle and nearly 1,000 virtually, chanting: “We stand together, power to the workers, the future is in our hands.”
“Companies are now facing a complex dilemma,” says Alison Taylor, author of Higher Ground: How Business Can Do The Right Thing in a Turbulent World. But let’s be fair, Taylor adds. In some ways, companies brought some of this on to themselves. “Ever since businesses claimed to care about all stakeholders a few years back—and not just shareholders—and once their marketing started saying they are about both profits and purpose—they opened up a novel space for negotiation that didn’t used to exist. … Now, the number of issues companies are being asked to take a stand on that seemed ‘black and white’ under Trump—disregard for the climate, racist police killings and building walls—have sprung the door open for a whole host of other contentious issues.” CEOs, she says, now find themselves pressed into talking about China and Ukraine, Iran and Israel, gender equity, immigration, identity and abortion.
And all of that? Says Taylor: “It’s a lot less convenient.”
New Era of Employee Engagement
It’s also ushering in a new era of employee engagement, revved up by questions some civil society leaders say are long overdue. What does it mean to be a good business? And how might businesses best navigate the simultaneous pursuit of profit and purpose as the voices of stakeholders and corporate activists grow louder? What does it really take to build a healthy organizational culture? How can companies do better at creating corporate values when society itself is so divided?
All tough questions, to be sure. But avoiding them, or turning a blind eye to employee and other stakeholder demands in this climate will not make for a soft landing—for two reasons. First, companies can no longer control what kinds of stories, images, TikToks and videos that full-time, part-time or contract employees share or publish about the workplace, whether good for retention, or a disaster. And second? Recruitment and retention, particularly of younger workers, depends on carrying through on a company’s cause activism promises and PR, critical to building trust in workplace cultures still getting recast, post-pandemic, at many companies.
Some CEOS are grumbling that they already have ESG issues spelled out and teed up for delivery. They don’t need more issues coming across their company’s internal radar, hot off the news, like the war in Gaza and trans rights. “Corporations are not democracies and stakeholders are not an electorate,” says Taylor. We’re living in a time of social outrage, she says, “and we may be pushing a lot of our political frustrations into the realm of private companies.”
What businesses need today, says Taylor and other business management and communications experts, is a new and deliberate strategy for how to speak up in this time of social turbulence.
Retention and Recruitment Risk
In the Deloitte survey, climate change concerns are among the top concerns now being expressed by younger workers. According to Deloitte, roughly 45% of the two youngest generations of workers will not only publicize what companies are not doing, but will also quit their jobs (or plan to do so) over climate concerns if the work is not eco-friendly. [It wasn’t immediately clear how many young workers actually had quit or have given notice due to these concerns.] In Deloitte’s survey—which queried more than 22,800 GenZ and Millennial employees in more than 44 countries—62% of GenZ and 59% of Millennial respondents said they want to see employers prioritizing the planet’s health, beyond marketing and empty PR promises.
And that’s not all. Nearly half of GenZers and more than 40% of Millennials told Deloitte they have already rejected assignments or projects based on their personal beliefs, due to reasons such as the projects’ potential for environmental harm or their contribution to inequality due to non-inclusive practices.
“It’s risky to say no to large digital networks of employees,” says Ethan McCarty, CEO of Integral, an employee activation consultancy. “They can get their messages out to thousands in seconds. They also trust business more than any other institution, and they expect companies to be able to fix things that today’s governments cannot in these very divided times. … If a business can’t help, recruitment and retention can get seriously challenged.”
Taylor agrees. “Today’s employees, chiefly those in the United States, are far more likely in today’s world to raise alarms about what businesses are (or aren’t) doing about climate change, racism, political conflicts, abortion and gun control,” she said in a recent interview, and the reputational risks in this age of social media can be great if not at least partially heeded or engaged.
Taylor also says she thinks that increased corporate activism in the U.S. “has something to do with disillusionment with politics, especially among young people. You can wait four years to cast your ballot in a gerrymandered system where your vote won’t make any difference,” Taylor told WelcomeToTheJungle, an industry blog, “or you can pressure your employer to change the company policies or boycott a brand, and it’s far more likely these days that your employee activism efforts and social media campaigns will have an effect.”
From #QuitTok and #RageApplying, viral trends are giving workers more power this presidential election year to get all sorts of issues and company successes and failures out into the public square.
Some efforts now are both theater and threat—with organizers targeting top annual or regional and national events to win maximum exposure. At the annual MET costume gala earlier this month, sponsored by TikTok and held at New York City’s Metropolitan Museum of Art, a nonprofit, some costumed employees and outside pro-Palestinian activists targeted many of the celebrities attending the MET’s annual costume gala who hadn’t yet spoken out about the more than 30,000 lives lost in Gaza, with influencer Haley Kalil posting a since-deleted TikTok of her lip-synching to the words “let them eat cake” while wearing a Marie Antoinette-inspired gown. TikTok user @ladyfromtheoutside responded to the video by calling for a “digital guillotine” —a campaign urging social media users to block celebrities who’d been silent about the ongoing conflict, including Taylor Swift, Beyonce, Drake, Justin Bieber and many others.
Ironically, the cause activists were in synch that night with over 500 members from various publications such as Vanity Fair, Vogue, Architectural Digest, Allure, Self, Glamour, GQ, Teen Vogue and Bon Appetit—all union activists at Conde Nast, who were threatening to walk off the job during the MET Gala (which Vogue magazine Editor-in-Chief Anna Wintour was hosting)—if negotiators failed to reach a deal for the magazine union’s first contract. [The workers won, just before the Gala got underway.]
Trust Risks
The most worrisome protests, however, are those which cost companies money and/or demonstrate messaging from companies that conflicts with the reality of their corporate actions. According to Deloitte, worst-case examples involve the leaking of embarrassing internal information directly to social media sites or news reporters. One example? When Amazon last year announced a $10 billion investment to tackle climate change, employees broke confidentiality agreements to highlight the company’s ongoing work with oil and gas companies.
There also can be a monetary cost and loss of clients. In 2022, for example, thousands of Salesforce employees signed an open letter urging Co-CEOs Marc Benioff and Bret Taylor to stop doing business with the National Rifle Association. “It’s not in our power to get background checks or other gun control measures passed by Congress,” the employee letter said, “but we can affect change by ending our commercial relationship with our customer, the NRA.”
Weber Shandwick says nearly four in 10 employees (38%) report they have spoken up to support or criticize their employers’ actions so far this year over a controversial issue that affects society.
New Rules
What to do about the social cause activists who are employees and who are now in the limelight?
Here are some of the common approaches now being considered among some businesses, according to the Business Roundtable:
Restrict or normalize forums for employee speech. A 2023 Herbert Smith Freehills survey on the future of work found that 97% of employers were attempting to impose some level of top-down control, such as non-disclosure agreements, but senior leaders are now also considering ways to invite employee voices into regular, frequent conversations about social issues they care about, and in ways that don’t create a silent and resentful minority or slow down the pace of work—but rather solicit employee input and enable employees to vote on the top one or two issues they wish the company to showcase most publicly.
Be inclusive and transparent about politics. Organizations cannot represent all employees’ views on political questions, Taylor says. “Issues such as racism, reproductive rights and climate change are fraught because they have both political and personal dimensions,” she says. “Companies cannot ignore these views, and neither can they simply hope they won’t crop up during the workday, or prevent employees from posting about them.” Allstate Insurance stands out for having created the Better Arguments Project, a civic collaboration with the Aspen Institute and Facing History and Ourselves. The project focuses not on limiting debate but on making it healthier and more respectful. Its goal is to teach employees how to stop seeing winning an argument as the goal of engagement, and to be more vulnerable and compassionate about people who hold different views and beliefs. IBM’s long-standing approach of not contributing directly to any political candidate also helps augment transparency to build trust and model workplace behavior.
Base your corporate promises and commitments on how your company’s work impacts human beings. Focus on human rights principles, not issues. The UN’s Guiding Principles on Business and Human Rights focuses on individual agency, bodily autonomy and dignity rather than attempting to impose values on people who may not share them. “Under the Principles,” Taylor says, “corporations must identify whether their actions are causing, contributing or are directly linked to negative human rights impacts and are helping organizations to consider tricky trade-offs, such as those between the freedom of expression and the right to privacy.”
Giving employees both agency and responsibility around speech is easier said than done, but “barking orders from above while tuning out employee sentiment has become wholly impractical,” says Taylor.
Leaders need to adapt. Organizations need to solicit and support employee voices at all levels “and continually emphasize the importance of individual accountability and involvement in shaping an organization's commitments while also understanding the trade-offs and limitations it faces.”
“…Ultimately,” says Taylor, “more thoughtfulness and restraint over political and social advocacy, versus empty speeches and overpromising, will support workers’ agency and engagement with the democratic process and earn support for those issues in ways that other forms of activism cannot.”
What are your thoughts? Are some of these New Rules too tame, or do they sound about right in these times of turbulence and employee activism? Let us know where you stand, and why.