CEOs are getting more political, but consumers aren't buying it

By Jena McGregor

A new survey finds consumers are pretty cynical about why CEOs speak out on social issues -- yet in certain cases, still reward them for doing so. Photo / iStock
A new survey finds consumers are pretty cynical about why CEOs speak out on social issues -- yet in certain cases, still reward them for doing so. Photo / iStock

Starbucks chief executive Howard Schultz has spoken out on gun control, race relations, and the "cynicism, despair, division, exclusion, fear and yes -- indifference" in America today.

Facebook founder and CEO Mark Zuckerberg said at a developer conference this year that "I hear fearful voices calling for building walls and distancing people as they label others," even if he didn't directly mention GOP nominee Donald Trump.

And Salesforce.com CEO Marc Benioff has become a "ringleader," in the words of one state senator, of big business executives who have opposed state legislation that limits gay rights.

These and other CEOs have increasingly begun taking on social issues -- more than 200, for instance, have signed an opposition letter from the Human Rights Campaign opposing North Carolina's HB2 -- shedding long-held fears of offending certain groups of employees, customers or investors for taking risky political stances.

In doing so, companies often cite a defense of the rights of employees, a belief their corporations have a broader social role to play, or a philosophy that it's simply the right thing to do.

But a new survey released last week from the public relations firm Weber Shandwick and KRC Research finds that the average person doesn't see it that way.

The survey, which looked at consumer views of what it calls "The Dawn of CEO Activism," reveals that people cite media attention as the reason for CEOs' vocal viewpoints more than anything else (36 per cent of people chose this rationale).

The next most-cited cited (just 21 per cent of respondents, who could choose several reasons in their response) was to build the CEO's reputation. And while a similar number said CEOs were speaking out to be "open and honest about how they personally feel about an issue" -- a positive thing, certainly -- that's not exactly the same as people thinking it's to help employees or make a stand for the greater good.

Indeed, just 14 per cent of the 1,027 adults surveyed thought a reason CEOs were getting more political was because they wanted to "leverage their influence and financial power for good" or "do what is right for society." And only 11 per cent believe the rationale is to "speak up on behalf of the company's employees and customers."

Even if CEOs really are trying to use corporate muscle to make broader changes, or do something to protect employee rights, "that message is not getting communicated," said Leslie Gaines-Ross, Weber Shandwick's chief reputation strategist, in an interview.

It may be because this is such a new dynamic -- people are so focused on 'Oh, my God, this company [is saying this],' and not tying it to the reasons behind it.

"It may be because this is such a new dynamic -- people are so focused on 'Oh, my God, this company [is saying this],' and not tying it to the reasons behind it. The motivations behind why CEOs speak up have to be more clearly articled if this trend continues."

That could very well happen, because despite consumers' cynicism, the research also found an encouraging link -- if a nuanced one -- between socially active CEOs and the public's views. In general, more people saw CEOs as favorable if they took a public stance on hotly debated current issues.

But if the issue was seen as being wholly unrelated to the company's business, the results flipped, with more having an unfavorable view. (Perhaps just one problem with that whole #RaceTogether campaign last year from Starbucks.)

In addition, millennials -- now the largest generation in the workplace and a demographic marketers salivate over -- are especially drawn to CEO activism, with significantly more than other generations saying they would be more loyal to an employer if the CEO spoke out publicly on a controversial issue.

Employees and company cultures are so important today that CEOs are going to take on some of these social issues in the name of their employees.

Yet when it comes to their plans to buy anything from companies with more political CEOs, the results are mixed.

Forty per cent of respondents said they'd be more likely to purchase something from a company if they agreed with the CEO's public views. But 45 per cent said they'd be less likely to buy if they disagree with him or her. The first part of that finding, at least, fits with recent academic research which found, in an experiment, that people who were first told about Tim Cook's outspoken stance on a "religious liberty" said they were more likely to buy Apple products.

Still, while CEOs may be speaking out more on political issues or social policies, Gaines-Ross says political endorsements are likely to remain something of a taboo.

CEOs have long given money to political candidates, and plenty of business leaders do speak out. But it remains relatively rare to see current, sitting CEOs of large publicly traded Fortune 500 companies vocally endorse a particular presidential candidate. (For instance, the recent list of business endorsements Hillary Clinton released has plenty of bold-faced retired business leaders or other executives in key positions, but only a few current CEOs of Fortune 500 companies outside the tech industry.)

One reason for that caution, says Gaines-Ross, is that in an age of social media and increasing transparency, it's harder for the public to separate the image of the CEO and that of the company.

A few years ago, "the CEO could go and support something or have an event at their home in favor of something, and we would all know that's separate from the company," Gaines-Ross said. "Over time and certainly today, there's almost no separation, which is why speaking out has to be carefully thought through." (She would not comment on Intel CEO Brian Krzanich, who was recently reported to have cancelled a fundraiser at his home for Donald Trump; he later tweeted that "I do not intend to endorse any presidential candidate.")

Still, Gaines-Ross says she also believes the overall trend of greater CEO activism will continue, with top business leaders becoming even more politically engaged and socially active on hot-button issues.

"I think it will grow in time," she said. "Employees and company cultures are so important today that CEOs are going to take on some of these social issues in the name of their employees."

- Washington Post

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