Ken Spain: Managing Corporate Reputation Means Coming to Terms with the Political Landscape

Please see below for excerpts and read the piece in its entirety here.

• “In the world of political campaigns and elected office, the guiding principle of “all politics is local” has endured for decades as a reminder to deliver the right messages to the right people. In the same vein, public affairs professionals must now follow a similar adage: “all crises are political.”
• Crisis communications are no longer limited to traditional corporate reputational challenges like accidents, labor disputes, personnel issues, and lawsuits. Corporate behavior and brand values are now viewed through the same hyper-partisan lens that defines America’s political discourse, policymaking, and elections. Once-sterling brands like Bud Light and Target have suffered major reputational damage by underestimating the stakes of inserting themselves into the so-called culture wars. Companies can navigate this increasingly challenging landscape but must first understand its causes and consequences.
• For decades, businesses could expect pressure on bottom-line economic issues from familiar names on the left like Sen. Elizabeth Warren (D-MA) and Sen. Bernie Sanders (I-VT) while receiving support – or at least political cover – from Republican elected officials. Today, pressure from anti-business leaders and activists on the left is as intense as ever, but the stakes are now higher than ever due to pressure from the political right stemming from both economic populism and cultural divides. In July, Gallup measured confidence in big business at an all-time low among Republicans, with just 18 percent reporting high levels of confidence. This shift has, for instance, driven Republican attorneys general and Congressional leaders to campaign against corporate Environmental, Social, and Governance (ESG) policies and initiatives over the past two years while conservative legal strategists have targeted affirmative action and corporate Diversity, Equity, and Inclusion (DEI) efforts in court.
• It is possible for businesses to manage their reputations in a political environment of disequilibrium. But just as it requires high-quality due diligence and risk analysis before making important financial decisions, it requires a similar level of preparation and anticipation to navigate today’s politics. This means allocating time and resources to evaluate the stakeholders who take an interest in your business and game out how to engage and respond to those stakeholders. Engaging stakeholders before making business decisions with political ramifications can develop allies in the short term instead of making enemies in the long term. Companies should also develop messages that align across stakeholder groups and, when necessary, bifurcate messages for individual groups. While some reputational crises are inevitable, an ounce of prevention can be a pound of cure.