How Will BLM Change Corporate Activism?
August 11, 2020 for SAGE Publications: SAGE Business Cases Originals
Below is my contribution to a case study designed for graduate and post-graduate students to get a sense of how business can be effected by diverse, multidisciplinary issues. Editors later added teaching notes for professors, learning outcomes for school cirricula and abstracts for student clarity.
The Issue
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Increasing consumption and maximizing profits for shareholders have always been at the core of American capitalism and the basis for any business. In modern times, however, there is a growing movement for corporate social responsibility (CSR) as citizens come to grips with how the constant drive for corporate financial gain has devastating impacts on a number of social issues. Corporations and brands traditionally eschewed taking a stance of any kind, for fear of alienating customers or facing backlash from the public, but in this paradigm shift, staying silent is simply not good business sense.
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Social responsibility in companies of all sizes has been proven to boost a business’s prospects for long-term competitiveness, creating trust in shareholders and enhancing growth. Several studies have also shown a link between CSR and positive long-term financial performance as consumers are loyal to brands they trust to be socially responsible. Anywhere from one to two thirds of all global consumers say they buy brands whose values match their own and will actively avoid brands that do not.
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The economic benefits of CSR go beyond positive consumer relationships. Job seekers are more likely to apply for positions at companies with high moral and ethical standards and employees who are treated and paid equitably, in a positive and non-toxic working environment, will provide increased productivity.
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Some CSR changes are difficult to view in a spreadsheet, which can be difficult for corporations who chart every success in firm metrics. With a reinvigorated push for racial equity and social justice occurring in America, some companies are looking to make these changes, but not all of them are thinking through the implications of their words and actions. Corporations looking to get into the CSR game are reconciling with their past actions, or inactions, or they risk angering a large consumer base for hypocrisy and dissonance.
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Why Is It News?
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After the death of George Floyd in police custody, the Black Lives Matter (BLM) movement saw renewed support to end systemic racism in all walks of life, challenging corporations to rise to the occasion. While nearly every celebrity, brand, business or corporation took to social media to say they supported the movement, not all of them backed these statements with measurable action items. Many used PR and marketing tactics to make their company appear supportive and woke, effectively virtue signalling or piggybacking on the movement as a sort of low-cost tokenism.
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In the eyes of consumers and employees alike, the worst a company can do is use PR and marketing solely to virtue signal or give lip service about supporting a cause without making authentic, meaningful changes within the company. After tweeting their support of BLM, L’Oreal had to come to grips with its own racist past, being forced to apologize for firing a black transgender model for speaking out against white supremacy.
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Direct action from corporations supporting BLM took on a number of forms: Nike repurposed its slogan with a “For once, Don’t Do It” advertisement on racism; Disney made a deal with Colin Kaepernick for a series on race to be directed and produced by people of color; PepsiCo retired the Aunt Jemima brand; Netflix shifted some of their cash holdings to banks and credit unions serving Black communities; and IBM stopped facial recognition software development because of its racial bias and unregulated use by police.
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Ben & Jerry’s has long been an example for corporate social responsibility and activism. Beyond adding a new - and delicious - flavor, Justice ReMix’d, to their activist ice cream lineup (which includes flavors like Pecan Resist, Save Our Swirled and Empower Mint), Ben & Jerry’s announced their four-point plan to dismantle white supremacy and continually update the public on these points. Few companies can match Ben & Jerry’s penchant for effective, corporate actions on social issues, but many joined the movement by celebrating Juneteenth, completing internal reviews on the racial makeup of their workforce, looking at the terminology or imagery they use, pledging for a more diverse workforce or product space in the future, and donating large sums of money to BLM causes.