Caught in the crossfire: business and the politics of engagement

By Kristina Joss, Senior Consultant, Salterbaxter

Women’s March on Washington

Despite being only a few weeks into the new administration, it would be hard to argue that the US political system has become northing short of a circus. Showmanship, multiple (and often unexpected) acts, and even the occasional clown are becoming the new political reality. And with all of that, a new juggling act has emerged — corporations and their stakeholders.

The case for better engagement

Stakeholder engagement has long been a core component of any good sustainability strategy. Corporations, consultants and NGOs all agree that meaningful, transparent and two-way engagement unlocks tremendous business value from which all parties gain.

However, the world is a little different than it was even a year ago. The 2016 US election has exposed an unprecedented divide within society that has sparked a new wave of activism and political engagement. Brands, whether they choose to or not, are getting thrown in the middle of it. With society in an increasingly “us vs. them” mentality, companies are at risk of alienating significant numbers of their stakeholders, from consumers to partners, in how they respond.

Two considerable tensions are emerging for corporations:

1. Recent government action is testing corporate values. Businesses are being pushed to take a point of view on political issues in a way they never had to before.

2. Stakeholders are expecting more from the business community. Whether it’s employees calling for a position on a controversial issue, partners looking for leadership on changing regulation, or consumers selecting brands that align with their values, corporations will be juggling a multitude of, and often conflicting, opinions.

Corporate action in response to these tensions is bringing both positive and negative responses from the public as consumers, employees and partners represent all ends of the polarizing political spectrum. The corporate leaders will likely continue to lead, with Silicon Valley often at the helm, but an interesting development to watch is which corporations get quieter. Each political issue or national topic that makes its way to the forefront will need to be carefully considered. This is likely to create a larger divide between the leaders and followers as corporations weigh the option to stand up or shut up (See article by my colleague Luna Atamian).

Here are 5 things all companies can do to weather this ‘brave new world’:

1. Get laser focused: Slogans like “Love Trumps Hate” are catchy and powerful, but they lack focus. Companies will need to cut through the noise and identify the most important issues to their business and stakeholders. This can be focused and local or focused and global, but either way broad agendas will be less effective than issue-specific approaches.

2. Start from within: Naturally, most medium to large businesses will be a snapshot of our divided society with employees representing a wide range of opinions and political motivations. Companies will need to be sensitive and respectful of this diversity, and stress test any evolving values or opinions internally before going public.

3. Meet your government relations team: In the way sustainability pushed CSR professionals to cozy up to their procurement teams five years ago, now is the time to get to know the government relations team. These individuals, who are often overlooked by CSR teams, will become increasingly important to your sustainability interests. Engage them now and often.

4. Track the landscape, regularly: The guarantee with President Trump is that there are no guarantees. Policy positions related to sustainability will shift with the wind and companies will need to be vigilant and agile. Keeping pace with stakeholder expectations and public sentiment will be the greatest challenge, requiring a diligent and savvy monitoring system. Monitoring conversations on social media can be a useful way to keep your finger on the pulse (and not just for President Trump’s tweets).

5. Enter at your own risk: Trump’s campaign promises are set to deliver a mixed bag for businesses, with benefits to gain and controversies to bear. Under careful scrutiny of watchdogs and sustainability activists, corporations will have to be careful in their messaging of what they support and what they don’t to avoid hypocrisy. This is particularly applicable to the environment where changing regulation could mean significant setbacks for the sustainability community. Corporations should expect sustainability experts and partners to be less compromising in their engagement with business.

A balancing act

Stakeholder engagement has never been more important than it is now. Corporations are going to have to think creatively and strategically on how they can maintain positive relationships with a wide range of stakeholders that will, in some cases, represent distinctly different views. Engagement will need to be more consistent, more transparent and more tailored. This also means a clear purpose and set of values will be critical for a company navigating these murky waters.