How should companies respond to contested social and political issues not directly related to core business?
As societies become more diverse and their members more polarised, the need grows for a leadership approach that reduces discord, restores trust and bridges divides.
Each issue involves tense debate, interconnection with views on like issues, strong emotions and disagreement. In the US, recent issues include the conflict in the Middle East, free speech, racial justice, and the tug-of-war surrounding diversity, equity and inclusion and environmental and social governance. In Australia, it includes similar debates plus ones surrounding Australia Day, the Voice referendum and marriage.
The company’s response to the catalyst – i.e. taking a public stance on a contested issue not directly related to core operations – is the secondary trigger event. This can be a statement from the company itself, or implied through business actions leveraging financial and economic resources , initiating disciplinary actions against an employee, or restricting the provision of services to a customer.
Media focus eventually recedes, although memory of the controversy lingers and can easily be revived. The worst combination is when the public stance is taken while the company performs poorly on a core operational activity. For employees, these include polarisation of views in the workplace and impacts on diversity of viewpoints and expression as some self-censor. The fallout includes negative effects on psychological safety and wellbeing, productivity concerns and distractions, and difficulty managing internal disagreement, advocacy and activism.
First, they involve highly contested issues attracting a broad range of views and an absence of social consensus . The first principle is commitment and restraint: combining a commitment to excellence in core business with restraint from taking sides on contested issues not directly related. Some may think restraint is just “staying silent”, but it actually enables business leaders to play an actively collaborative role in helping restore trust across institutions at the intersection of business, politics and society.
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