When corporations become political |
A large billboard stands on top of a Nike store showing former San Francisco 49ers quarterback Colin Kaepernick, at Union Square in San Francisco, Calif., in 2018.Eric Risberg/The Associated Press
Andrew Stark is a professor of strategic management at the University of Toronto.
At year’s end, it’s worth reflecting on the most unsung revolution of our time: the steady conversion of the corporation from an economic institution into a political one. All of its major stakeholders – consumers, employees, investors, suppliers – now routinely use the corporation as a mallet to hammer each other on political issues.
Consumers confront employees, such as when, this past fall, consumer boycotts threatened companies that failed to fire employees for posting anti-Charlie Kirk messages. Employees, for their part, take on consumers. In July, a Cisco employee publicly resigned because the company was selling technology to the Israeli military. That employee wasn’t taking on their employer, they were taking a stance targeting their employer’s customer.
It goes on and on. In recent years, suppliers have confronted consumers: vendors such as Amazon, Apple and Google refused to supply cloud services to platforms like Parler because of their use by extremist customers. Consumers have taken on suppliers: customers petitioned Whole Foods to drop Eden Foods as a supplier because of Eden’s anti-abortion stance. And investors have gone after consumers. Over the past little while, religious institutions have used their shareholder status in banks such as JPMorgan Chase, Barclays, and HSBC to pressure them into terminating financing for fossil-fuel companies. While this could be seen as an investor targeting a corporation, in the end their actual targets were other customers of the corporation.
Whichever stakeholders you choose – suppliers, investors, consumers or employees – you can find instances when they have picked a fight with each of the others. This is something relatively new. It’s true that stakeholders have for a long time taken on the corporation itself as their political opponent: recall the disinvestment campaigns launched against companies that did business in apartheid-era South Africa. Or, more recently, think of the boycotts that conservative consumers launched against Disney in 2022 for criticizing Florida’s “Don’t Say Gay” law.
But we’ve gone beyond that. Stakeholders are now contesting each other directly with each other, using the corporation as a mere playing field.
Many of the most prominent recent cases involve American corporations. But since great numbers of us outside America are consumers, investors, employees or suppliers of American corporations, we too have an interest in finding some clarity in this whirling kaleidoscope of political conflicts that surround the U.S. corporation – conflicts that certainly cause pain all around. Is the political use of the corporation justified? If so, how?
In 2018, Nike came under pressure from investors to pull its ad campaign featuring Kaepernick, known for taking a knee during the U.S. national anthem.Mark Lennihan/The Associated Press
One basic complaint is that a stakeholder’s freedom of monetary expression – their freedom to use their money to support only those causes they endorse – is allegedly being violated whenever their hard-earned dollars wind up in the pocket of another stakeholder whose........