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Should Companies Take a Stand on Social Issues?


Companies aligning with social causes have increased significantly in recent years, reflecting a broader shift in societal norms and expectations. These organisations aren't just taking a stance; they're embracing corporate responsibility and leveraging their power to impact change on topics that matter. This article addresses why companies should care about social issues, the pressures of corporate responsibility, and the necessity of authenticity in corporate actions.

Currency of Conscience: Should Companies Take a Stance?

Social issues have moved to the top of the corporate agenda in today's fast-paced business environment. This isn't a passing trend; it's a business need driven by shifting customer, employee, and societal expectations.

The question of "Should companies support social issues?" bears significant influence on a company's brand image and reputation. When done correctly, corporate involvement in social issues can result in a competitive advantage, attracting both customers and staff.

According to research, taking a statement on social issues that are important to consumers can have a major impact on a brand's success. According to a Nielsen survey, 66% of customers, with an even greater number of 73% among millennials, are more likely to make a purchase from a brand that matches with their values on social issues. Furthermore, Deloitte's findings show the extraordinary trend among Gen Z, who, more than any other generational group, are leading the way in adopting sustainable behaviours. Around 50% of Gen Z individuals have consciously reduced their consumption of non-sustainable products, while 45% have actively avoided certain brands due to concerns regarding sustainability or ethics.

Some of the world's most successful businesses have capitalised on this trend. Amazon, one of the most valuable companies in the world, pledged $10 billion to fight climate change, demonstrating its dedication to environmental sustainability.

Nike, another prominent example, has continuously championed racial equality, most notably in their "Believe in Something" campaign featuring Colin Kaepernick.

Both companies provide compelling examples of how backing social causes can positively influence the brand image.

An Australian Example of Authenticity and Corporate Stance

In an example closer to home, more than 70 organisations in Australia, including not-for-profits, banks, sporting code peaks, IT and insurance companies, trade unions, educational institutions, and some of the country’s biggest corporations, came together to support a Voice to Parliament and a “yes” vote in the Referendum in 2023. The Australian Indigenous Voice referendum, scheduled for 2023, aims to modify the Australian Constitution to establish the Aboriginal and Torres Strait Islander Voice. This Voice aspires to represent Indigenous Australians in parliament and the federal government on Indigenous issues.

The organisations, which are all members of a network of 2,450 with a Reconciliation Action Plan (RAP), took a bold statement on a national issue, displaying a strong alignment with their principles.

The Brotherhood of St. Laurence, Life Without Barriers, Independent Education Union, Public Health Association of Australia, Commonwealth Bank of Australia, Goodstart Early Learning, Wesfarmers, Fremantle Football Club, National Rugby League, Fujitsu Australia Limited, Origin Energy, Federation University, and Transgrid are all members of this diverse group.

This unique event highlights the importance of social issues in brand positioning and shows the importance customers and society place on companies doing business responsibly and authentically.

Employees Are More Vocal About Corporate Responsibility: A Catalyst for Change

In today's corporate world, employees aren't just silent spectators; they're influential stakeholders. The increasing role of employees in shaping a company's social and environmental policies is evident. An Edelman Trust Barometer report found that 67% of employees expect their employers to join them in advocating for social justice issues.

Internal communication on the corporate perspective on social issues is critical. A two-way conversation boosts employee engagement and strengthens corporate culture. Employees feel valued when they're heard and their concerns are addressed, and this has a direct impact on their job satisfaction and performance.

Ignoring employees' concerns, on the other hand, can have negative impacts. According to a Cone Communications study 76% of millennials consider a company's social and environmental commitments when deciding where to work, and they aren't hesitant to express their concerns or leave if these commitments aren't satisfied.

The corporate stance on social issues doesn't merely reflect external positioning; it's also an internal cultural marker that companies can't afford to ignore.

Walking the Walk on Social Justice Issues

While some corporations express their support for social problems through ad campaigns, these efforts may fall flat if not backed up by meaningful corporate action. This is when the essential distinction between ad campaign rhetoric and genuine action becomes clear.

When a company's actions align with its public stance on social issues, it’s walking the walk, not just talking the talk. Authenticity involves more than just making a statement or creating an advertising campaign around the topic. It requires meaningful changes in business practices, policies, and company culture.

Take Patagonia as an example. The outdoor clothing company isn't just vocal about environmental issues; it’s taking bold steps, such as pledging to become carbon neutral by 2025, to back up its words with action. Patagonia’s authenticity has earned it a loyal following and a reputation as a thought leader in corporate sustainability.

However, the consequences of a gap between a company's public support of a cause and its actions can be severe. For example, the fast-fashion sector has faced intense criticism and boycott demands for advocating women's rights in ad campaigns while allegedly exploiting female labour in its supply chains. This emphasises the critical importance of genuine corporate action.

Navigating the Tightrope: Is Supporting Social Issues Worth the Risk?

Choosing to support a social cause is frequently a tightrope walk for businesses, filled with both potential rewards and risks. The public backlash, polarising views, and potential damage to a company's reputation can be daunting.

However, with thoughtful risk assessment and strategy, companies can decide which issues align with their core values and are worth standing up for. Doing so isn’t just the “right” thing to do, but it can also drive business growth.

Despite risks, the advantages of genuine support for social issues can be substantial. A well-planned and authentic corporate stance can attract loyal customers, motivate staff, and differentiate a brand in a crowded marketplace.

The Interplay of Corporate Stance and Social Issues

As the corporate landscape evolves, it is becoming evident that companies can no longer afford to be passive when it comes to social issues. The demand for corporate social responsibility is not a passing trend but a fundamental shift in expectations. Companies that are attuned to this shift and respond authentically can bolster their reputation and improve their bottom line.

The path to becoming a truly socially responsible organisation is far from straightforward. It requires deep introspection, commitment to change, and the courage to stand up for what's right. Yet, the rewards are significant - a deeper connection with customers, an engaged and motivated workforce, and a reputation as a company that genuinely cares.

And so, we're left with the question - is your organisation ready to take a stand?