On June 6, JP Morgan Bank announced that it will continue to withhold financial contributions through its political action committee (PAC) to certain Republican lawmakers who have contested the 2020 presidential election. The bank is resuming other support to lawmakers that it had suspended in January immediately following the attack on the Capitol.
Concurrent with this announcement, Facebook published its final decision to bar former President Donald Trump from its platform until January 2023 after an internal review, effectively silencing his presence on the social media giant beyond the 2022 midterm elections. Trump is also banned from other media platforms, including Twitter, due to posts that Twitter characterized as “glorification of violence.”
These actions are the latest of many in the wake of the January 6 insurrection at the U.S. Capitol and the saga of continuing denials of not only the legitimacy of President Biden’s election, but the actual events of the insurrection. Apparently, corporate America is not impressed with the current political landscape.
Within days following the January 6 event, Reuters published a list of companies cancelling or suspending their political contributions. In addition to JP Morgan, the list included such major corporations as AT&T, Dow, Wells Fargo, Amazon, PepsiCo, Walmart and BlackRock.
While some companies like AT&T withdrew “donations to lawmakers who opposed Biden’s certification,” others like PepsiCo suspended “all political contributions while conducting a full review to ensure they align with the company’s values and shared vision going forward.” Facebook also “temporarily” withdrew all support to “both political parties.”
American Business Leaders Have Also Been Vocal and Swift in Their Public Statements
American business leaders also have been vocal and swift in their public statements. The Business Roundtable, a collaborative national leadership group of CEOs, immediately put out this statement on January 6, amid the chaos of the Capitol insurgence: “The chaos unfolding in the nation’s capital is the result of unlawful efforts to overturn the legitimate results of a democratic election. The country deserves better. Business Roundtable calls on the President and all relevant officials to put an end to the chaos and to facilitate the peaceful transition of power.”
Corporate influence in politics through financial clout is hardly new. Business has always lobbied its interests in government and financially supported those candidates most likely to pander to those interests. These current corporate actions are a decidedly different flavor, however, and deliver a loftier and stronger collective social message.
Instead of just putting money where it seems expedient and going about their business apart from the public theater, these corporations are actively participating in public discourse about social issues and matters of ethics. Many organizations are also configuring their business operations in a holistic approach that embraces environmental and social action as a part of doing business.
Corporate Social Responsibility Is a Trend That Has Been on the Rise
This business model is called corporate social responsibility (CSR), a trend that has been on the rise of late. As a recognized business practice, corporate social responsibility received some attention in the 1990s with President Bill Clinton’s creation of the Ron Brown Corporate Citizen Award to honor companies that excel in meeting the needs of their employees and their communities.
The concept gained global attention with the United Nations establishment in 2000 of the UN Global Compact (UNGC), “a call to companies to align strategies and operations with universal principles on human rights, labour, environment and anti-corruption, and take actions that advances societal goals.” Currently, 751 U.S. companies are listed as participants in the UNGC.
There is no one-size-fits-all CSR prescription of operation. That corporate social responsibility has gained mainstream traction is demonstrated in Business Roundtable’s adoption in 2019 of a new Statement on the Purpose of a Corporation. The crux of this operating philosophy is “companies should serve not only their shareholders, but also deliver value to their customers, invest in employees, deal fairly with suppliers and support the communities in which they operate.”
Essentially, this is the triple bottom line theory – people, planet, prosperity. Corporations are recognizing that practicing sustainability is necessary to survival. As people and planet go, so does business.
One key motivation for embracing corporate social responsibility is enhancing a positive business reputation. At the core of corporate social responsibility is respecting the welfare of the corporation’s stakeholders. This means a business must operate within an ethical framework that positively develops relationships among employees, managers, and owners; foster forward-thinking, innovative strategies; and respect the interests of the local community and the environment.
A Legitimate Corporate Social Responsibility Agenda Much Improves Companies’ Internal and Public Perceptions
Esteem translates to success. Pursuing a legitimate corporate social responsibility agenda can do much to improve both internal and public perceptions of companies with checkered histories.
For example, it is not surprising to hear JP Morgan and Wells Fargo take a public stand on the 2020 presidential election controversy. Both companies are surely working to repair the inevitable damage caused by notorious, expensive scandals.
Forbes calls corporate social responsibility an essential – and ethical – business tool. It is not a just a template. Any business can mold an approach that best fits the company’s mission, people and place.
The point is that business has become involved in the whole social fabric, which includes assessment of the political reality. Business leaders have determined that corporate interests must align with public perceptions and social needs for long-term stability. There is no room in this model for corruption, toxic manipulations and shortsighted cheap shortcuts because such practices will ultimately backfire.
Coping with the pandemic and recent political foment has revealed dramatically that business success critically depends on flexibility, positive leadership, and empathy. Such is the message about the presidential election that alert corporations are sending to all politicians and to the public.
The message is all political parties should expect such activism to continue.