Speaking out: how to prepare CEOs to lead corporate activism

November 19, 2019

Climate change. Immigration. Gun violence prevention. Abortion rights.

There is no shortage of polarizing issues facing our society, and more and more CEOs and the organizations they represent are taking a stand. The expectation is that this phenomenon will only grow.

It’s not necessarily the CEOs themselves who are driving this trend. They are often encouraged to take a position on highly political topics by not only activist customers but also employees who increasingly align career with purpose.

For the business leaders who counsel CEOs and the C-suite—including human resources, public relations, and investor relations professionals—this new reality presents a quagmire of potential downsides, but also a huge win if done right.

According to Steve Lundeen, MEd, PCC, CPCC, a faculty member with Capella University, doing it right all starts with clearly identifying and communicating an organization’s values.

Lean on values

“I can’t stress the importance of this enough,” Lundeen says. “An organization’s values simply have to drive how and when it takes a stand on a potentially polarizing issue.”

Lundeen explains that when organizational values are thoughtfully developed and robustly communicated to employees and customers alike, it should come as no surprise when that organization eventually does take a public stand. Rather, it can drive support and allegiance to the brand.

He adds that a CEO’s personal beliefs should have little to do with an organization’s stance on sensitive topics.

“It’s not about what the CEO believes, but rather what the company believes,” Lundeen says. “When you are the CEO, your first obligation is to be true to the values and the mission of the organization. That is what should drive your direction.”

Fully explore the pros and cons

As straightforward as it may seem to align a public position on a hot topic with organizational values, Lundeen is not Pollyanna. He understands and advocates for a robust cost-benefit analysis before taking any high-profile stance. That includes the potential impact on sales and revenue, employee recruitment and retention, regulatory ramifications, and more. All potential end-game scenarios should be fully explored.

“This sort of approach may sound cold, but doing a deep cost-benefit analysis is critically important,” Lundeen says. “Most organizations are rightly concerned with the bottom line, and they can’t ignore that. They have to know what they are getting into and all possible outcomes.”

Part of that research should include an introspective look at how well an organization knows its customer base and other stakeholders. How will they react to a public stance on a certain topic? Will it drive loyalty or drive them away? Might it result in a boycott? Could it actually bring in new customers?

What do you do if the results of a cost-benefit analysis conflict with an organization’s values? In other words, if a stance is likely to hurt the bottom line, do you still take it?

“This is a hard one, but if they are in conflict, values really should win,” Lundeen says. “It’s about doing the right thing even in the face of potentially losing business.”

However, Lundeen is quick to add that organizational values can and do evolve, which is healthy. Just as our individual perspectives on the world and society change over time, so should that of a company. He recommends that organizations regularly review their values and determine whether they align with where the organization, and society, is today.

None of this exploration should be done in a vacuum, Lundeen adds. Rather than taking a narrow view of your organization only, a full competitive scan should be completed.

“An organization should ask themselves, ‘Do we want to be leading the charge on this issue? Do we want to be the last one to take a stand?’” Lundeen says. “Typically, it’s somewhere in the middle, but you need to assess this before you make a move. It allows you to be strategic around timing and when to publicly take a stand.”

Involve your employees … carefully

While it is typically the CEO who ultimately makes the call as to whether an organization takes a specific stand on an issue or not, who else should be involved in guiding that decision? The rest of the C-suite? The board of directors? Investors? Employees? Lundeen says it depends on the organization, but it is usually a mix of all of the above.

“This can be a can of worms, so tread carefully,” Lundeen says. “That said, I believe in getting input. When employees believe they’ve been heard and have a voice, they can be much more supportive when the company goes public with a stance. You need them as advocates.”

To make all of the above happen, Lundeen advocates that those who counsel CEOs and the C-suite nurture those relationships well in advance to prepare for potentially difficult conversations in the future.  

“It just won’t work unless you are that trusted, go-to consultant, that North Star,” Lundeen says. “These are not topics you can dance around. They need to be addressed with objectivity, but also with firm conviction. There is way too much riding on these decisions not to be prepared.”

Gain the critical-thinking skills needed to guide your organization through turbulent times with an online degree in human resource management from Capella University.

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