One of the most destructive ideas to have afflicted business in the past few decades is the nonsense of the so-called ‘triple bottom line’. This is predicated on a so-called ‘social licence’ that businesses are apparently supposed to obtain. But the entire thing is so vague that it’s inherently open to abuse by mendacious activists. After all, who gets to decide on the issuance of the so-called ‘social licence’? Without exception, that turns out to be bullying activists, often using astro-turfing tactics.
The notion is also directly contrary to the fundamental purpose of a corporation: to make money for its shareholders. Anheuser-Busch shareholders, for instance, lost a lot of money in the debacle of its former ‘brand ambassador’ transgender ‘influencer’ Dylan Mulvaney. All in all, companies would be far better off sticking to their core purpose.
They’re finally starting to realise that.
Corporate America is required to disclose risks to their businesses in their annual regulatory filings. This year, Walmart, Target, Home Depot, Corona-parent Constellation Brands join an increasing number of companies advising investors about customer and legal backlash to their diversity, equity and inclusion (DEI) policies and environmental, social and governance (ESG) initiatives. They’re also giving notice of the risks of rolling back these programs.
Businesses typically warn shareholders about economic downturns, data breaches, natural disasters, and tax code changes. But companies are adding new risk disclosures in response to the intense political divide over corporate efforts to increase diversity in the workplace, promote LGBTQ rights and slow down climate change, corporate governance and risk management researchers say.
Note that those are a laundry-list of fashionable left-wing nonsense, which gives you a stark lesson in exactly why ‘ESG’ is such a poisonous notion. It means that corporations are going to piss off at least half of their customers, probably more, given recent US election results.
“Companies face a Catch-22 situation,” said Kristen Jaconi, director of the Peter Arkley Institute for Risk Management at USC. “Consumers may be dissatisfied if a company takes a particular position on a social issue or if a company takes no position at all.”
Which is bollocks, of course.
Saying nothing is the default, no-risk position. It may surprise the layperson, but anyone who’s studied crisis and risk communication knows that, even in the face of a full-fledged public relations disaster, ‘no comment’ is actually the least riskiest response. A director of a ‘risk management’ firm ought to know that.
When it comes to hot-button political issues, the wisest course for companies is to just shut their yaps and concentrate on making money. Every bit as celebrities ought to cram it in their pie holes and just stick to doing their little dances.
The basic error is to assume that social media is the real world. The millennial communications graduate you foolishly hired might think otherwise, but most people don’t use X or Instagram slavishly. Especially not to peddle politics. As repeated studies have found, the vast volume of political commentary on social media is generated by just a handful of hyperactive political tragics.
Many companies are warning about consumer boycotts from both the political right and left, stoked on social media platforms.
“Strong opinions continue to be publicly expressed both for and against diversity, equity and inclusion and ESG initiatives,” Walmart said in its annual report released in March.
In which case, it’s best to just say nothing at all.
Walmart, which ended some of its diversity programs earlier this year, said it and other companies’ positions are “subject to heightened scrutiny from consumers, investors, advocacy groups and public figures, potentially leading to consumer boycotts, negative publicity campaigns, litigation and reputational harm.”
Target said in its annual report in March that expectations from shareholders, customers and employees over whether it should offer certain products or pursue ESG and DEI goals are varied, and at times conflicting.
“We have previously been unable to meet some of those conflicting expectations, which has led to negative publicity and adversely affected our reputation,” Target said.
Then stop trying. Leave politics to the politicians and just stick to doing what you’re supposed to do.
