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Avoiding the Next Disney Quagmire
In the late 2000s, I attended a series of meetings with different clients who were all companies from one particular industry. I must have looked deep in thought on the train ride home because my business partner asked me what was on my mind. I told him that I had seen the future in these meetings and didn’t like what I saw, which was a love-fest between like-minded executives and consultants enjoying their shared endorsement of particular causes. These causes, I felt, represented what these corporate and cultural elites personally believed and were about to misrepresent to top executives as the way forward for the company at large.
“I don’t believe this thinking represents what others at these companies believe, nor do I think this so-called ‘stakeholder capitalism’ represents what the broader public believes,” I said.
“What’s your concern?” my partner asked.
I answered with one of my favorite proverbs: Entrances are wide; exits are narrow adding, “They’re about to pick fights they cannot win and we’re going to be left with the debris.”
The Disney fiasco is a downstream example of what I saw all those years ago. Today, CEOs are actively assessing their risk of falling into the same trap Disney did.
This suggests that the very public fight Disney picked with Florida Republicans had a meaningful reputational impact (as well as financial, given the abolition of a special taxing district and the subsequent drop in the company’s stock price).
In the past, most right-of-center activism has faded away with no meaningful impact on a company’s business. Why? Because conservatives are terrible at pulling off boycotts because boycotts usually require the support of the popular culture and the legacy news media. Conservatives have neither.
But the Florida imbroglio was different because it happened in a venue where conservatives actually have power: politics. Disney never imagined that a governor would come after them the way Florida’s Desantis did. This is provoking Disney’s peers to take stock of their plans for weighing in on cultural and political fights.
As it should.
Companies can’t always avoid getting involved with issue-driven fights, but my experience has been that it’s more possible than many executives and their advisors currently think. In fact, some of the most successful issues and crisis management programs I have ever been involved with have succeeded because they were minimalistic and, in some cases, uninteresting. Not every fight is worth entering and not everything is a branding opportunity.
We can expect to see these conflicts play out further as we lead up to a likely overturning of Roe v. Wade. News outlets will call upon companies to take a stand — or ask them why they haven’t taken a position, a form of advocacy and provocation cloaked in reporting. Some, such as reproductive health firms, likely will take a position because it is in their commercial interest to do so. Others may enter the fray to relieve pressure from one or more interests. They will have to ask themselves questions such as: Who are the audiences to whom we have an obligation? What will be the price of addressing these audiences? Are our goals even doable? Who will be enraged? How will they react? And, finally, which is the least bad of only bad options?
Companies need to fight where they’re strongest and have some sense of control, not where they’re weakest. A business can attempt to use its cultural power to move audiences in a direction aligned with corporate values and the values of its employees and other audiences. But try to do so on your terms, not the terms set by politicians and activists external to the company.
By wading into specific political fights, you are almost always wading into controversies outside your control. There are ways to address your employees’ concerns or priorities, for example, without animating the “other side” of a highly charged debate.
Keep internal policies internal whenever possible. Paid family leave, LGBTQ protections, internal affinity groups and other employee-driven policies can signal a corporation’s values to its internal stakeholders without animating a full-on cultural debate.
Create policies that restrict the company from weighing in on political debates outside its core business mission, uphold those policies, and communicate them to stakeholders while also communicating the steps you are taking as a company to maintain your values in a way that the company can manage.
Pick advisors steeped in realpolitik, not “issue warriors” beholden to particular causes. Many advisors are either fully partisan or are quietly seeking to fund organizations that are a part of their business model. This is good for the consultant, not the client!
Counterintuitive reality: Despite the popular misconception that corporations are conservative, I can get them to contribute fifty times more money to a progressive organization than to a conservative one because they are desperate for the support of progressives. The logic is that if you give your critics money, it will tamp down dissent. It rarely does, for long. Conservatives are aware of this trend, which is why many center-right groups have given up on “big business” and have turned against them in legislative fights. This will have to be revisited in order to avoid future “Disneys.”
Before jumping headlong into a fight, slow down and realize that, as Michael Jordan said, “Republicans buy sneakers too.” Be prepared for backlash when you stick your head up on these issues, and consider that you’re putting a target on your back every time you weigh-in. It’s a 50/50 country, and there is currently no longer a reflexively “pro-business” political constituency. Advocate under the banner of “doing the right thing” at your peril.
Entrances are wide. Exits are narrow.