F*** The Corporate
Could the anti-racist protests demonstrate a new normal that companies need to prepare for?
On a call with a client this week, I witnessed a black member of the corporate communications team’s raw anger at the way her company had responded to the killing of George Floyd and the protests that followed. She said that she felt personally offended that they had taken ‘so long to even acknowledge’ the issue.
This was despite the fact that the company has a thriving Diversity and Inclusion programme, and its response to the killing and protests was thoughtful and meaningful, expressing not just words but real action it is undertaking. Better late than never, said the member of staff.
The employee’s strength of feeling reflected a broader reaction amongst the public. The flood of support from companies is on a scale not seen before. Citi’s timely blog post (released on May 29) by their black CFO was personal and heartfelt. Ben and Jerry’s announcement was grounded in being able to demonstrate a board which has three women, one of whom is black, and a black man.
We’ve known for some time that response to public crises and events, once the realm of the state and governments, must now be in the wheelhouse of companies and the pandemic has validated that. From values and purpose properly aligned to a sustainable business model, to diverse board representation, to employee engagement programmes, business has a long laundry list of initiatives to meet these challenges.
21st Century CEOs must now be not just business but community leaders in the way that they must show leadership on public morality, values and decency. Where they do not feel assured in their responses, Corporate Affairs departments can be the moral seismograph on emerging issues, judging the internal and external mood to guide boards.
Comms teams have just hours to react to political events around them. More than ever, they need to ‘see around corners’ to predict known unknowns and deal with unforeseen events.
All of this costs time and money. The financial crisis saw a huge increase in compliance and risk functions in the banks as the new cost of doing business was government and regulators demanding stricter controls, with the penalty of not complying resulting in huge fines inflicted by legislators. Perhaps Citi and Goldman Sachs (which allowed a relatively junior member of staff to express his advice to white colleagues, on Bloomberg), having learnt the hard way by paying these fines and having to tackle historic cultural issues, have been more assured in their responses than others.
We’ve known for some time that consumers will walk with their feet if their brands are not aligned with their own values, and home working is set to stay which means more and more time on our feeds.
And more quota-based rules may be on their way, in the same vein as legislations on gender pay gap reporting in the UK. Although equality and laws against discrimination exist globally, quotas on boards for women have been in place in Norway since 2003, and widely discussed elsewhere.
The business case for diversity has never been stronger. But other crises will emerge – both ones we can predict such as climate change or others which engender the same outrage and to which companies will need to react just as swiftly.
Corporate Affairs teams require credibility internally, and the right operating model which has the right structure to tackle live emerging issues. We may be heading towards a new era of permanent crisis.