Businesses struggle to navigate values in a politically

Connecting with companies that share your values is a popular notion, but it’s become an enormous challenge for organizations as the nation’s political and social divisions deepen.

Corporate leaders are struggling to set values without alienating anyone and that’s “really become impossible,” business ethicist Alison Taylor told MPR News host Tom Crann Thursday.

Taylor, who’s currently writing a book about the new landscape for business ethics, gave a talk at the University of St. Thomas Thursday. While she’s concerned about a future America with “red banks and blue banks, red mattress companies and blue mattress companies,” she says there are companies successfully navigating the landscape — including two in Minnesota.

The following transcript has been edited for length and clarity. Click the audio player above to listen to their conversation.

I understand you’re writing a book about what you’ve called a seismic shift in the realm of business ethics. Is it possible to summarize that shift briefly and tell us what’s happening?

I will certainly try. Listeners might remember, there was a police killing in Ferguson in 2014. At that time, corporations did not want to talk about that, they did not want to talk about Black Lives Matter. Fast forward to 2021 and we have CEOs giving their personal opinion about the verdict in the George Floyd murder. So that is a completely incredible shift in just seven years.

So as companies do this and executives, what are they getting wrong, are still reluctant to do?

I think companies are really trying to figure out how to avoid alienating anybody. And as the premise of your original question suggests, that has really become impossible. The U.S. is extremely polarized these days. And there is a very high level of what we call effective polarization, meaning that we don’t just disagree with the other side, we’re quite likely to think the other side is evil and stupid. So I think this presents an environment of quite considerable risk for companies and it’s really only just becoming clear.

Can you share an example maybe where a company just really stepped in it by thinking that they did something and maybe what they could have done better?

Yeah, there’s so many. I mean, the world is really full of these examples these day. Recently, State Farm Insurance supported a project designed to get more lesbian and gay friendly literature into schools. I’m certain that whoever decided to do that at State Farm did it with the very, very best of intentions. But this doesn’t seem to have been something that was agreed as an organizational strategy. So what happened next was a lot of headlines saying “State Farm is trying to brainwash your children” and then State Farm, backtracked off this and reversed.

So the net result there is that they’ve upset really all the original people that supported the move and then they’ve upset everybody that oppose the move. This is a kind of reactive governance, by Twitter, I like to call it, where you end up with a sort of social media team obsessively monitoring what people are saying about you online and reacting to how shifts change. And I don’t think that’s any way to run a business. You have to be able to go through this process of setting your values and then be very, very clear about the way that you’re going to stick to those values, even if you get backlash. And even if you get criticism.

Now, all of this speaks to this other kind of interesting idea that’s maybe implicit in our conversation, which is that employees seem to be increasingly expecting corporations to act like a democracy. But really, it’s the best way to make your views held is via the political process. And I think we get into quite dangerous territory if we start to suggest or imply that you can have democratic decision making within corporations, especially about issues that are this controversial.

Tell us why you see that as dangerous territory.

We are starting to see management teams and companies in America sorting more and more politically. There’s a new research piece of research out that shows that C suites are gradually becoming either more Democrat or more Republican. I also spoke to somebody last week who’s in finance that is basically telling me that very shortly, it will be impossible because of political pressure to operate in both Texas and California.

So I think we all need to ask ourselves whether we want to end up in an America with red banks and blue banks, red mattress companies and blue mattress companies, where business becomes as polarized as the general population.

It becomes very, very impractical to run a business if you have to have a state by state strategy and we start to get further into social turmoil and possible violence. So I think that businesses really need to think about supporting a democratic political process, but I don’t think they should aim to replace the democratic political process by closing the gaps that the government has left open.

How should customers be thinking about this?

We need to think carefully about our choices of who we do business with, but I think we would all benefit from just understanding that business does best when it is pluralistic. Maybe we shouldn’t expect businesses to solve the problems we used to expect governments to solve. And maybe we just need to not lower our expectations but make them a little bit more realistic and encourage companies to be honest about a few things that they can really influence.

But at the same time, there are a lot of people who don’t want to let bigger companies where they do have influence off the hook on things that they care about, like climate change.

That’s absolutely right. And I think those employees can be incredibly powerful. I write and speak a lot about employee activism and one of the things that makes employees so powerful is that they’re insiders. So they’re in a very good position to find out and disclose if a company is lying, or if a company is being a hypocrite. But there are bigger issues here and we can’t just rely on business to solve them.

Have you had a chance to look at Minnesota companies and do you see any examples of them doing this especially well or not?

The example that springs to mind as you’re speaking is Best Buy, because I think they are an amazing leader. They were under a lot of competitive threat in the early 2010s but management made a point of listening to their employees, which is how they were able to come up with innovations. Best Buy is very, very clear about its values.

I also think that Target really does a pretty good job here. It can’t afford to alienate either Democrats or Republicans. And I think it’s done a very, very good job of engaging wider stakeholders and thinking about supply chain responsibility in particular.