Companies cannot win America’s culture wars

By the standards of contemporary activist campaigns, it was an unremarkable press release. Color of Change, a racial justice group, fired off a statement last week demanding that companies stop funding politicians who restrict women’s access to abortions.

Color of Change is far from the first progressive organisation to accuse businesses of hypocrisy for enabling attacks on reproductive rights while offering to cover travel costs for employees needing out-of-state treatment after the Supreme Court last month ended their constitutional right to a termination.

What was striking about its petition, however, was that many of these companies are simultaneously under attack from the right. Conservatives in Republican-controlled states have threatened to pull contracts from businesses such as Citigroup, which they see as helping women terminate pregnancies.

Business leaders increasingly find themselves in such unwinnable positions, caught between two sides on topics they never wanted to be debating, as culture war issues come to dominate US political discourse.

Disney has been the most visible target, beaten up by Florida governor Ron DeSantis after employee pressure prompted it to denounce the state’s plan to restrict discussion of sexuality or gender identity in primary schools.

But examples of businesses being dragged into the culture wars proliferate. Apple and others are at odds with Texas governor Greg Abbott over an order likening gender-affirming medical intervention for transgender minors to child abuse. West Virginia has warned that it could stop doing business with companies including BlackRock and JPMorgan Chase over their perceived “boycott” of fossil fuels.

And as Democrats blame corporate profits and high executive pay for inflation, Republicans have dubbed even the reliably free-market US Chamber of Commerce “woke” — the same label they now apply to corporations speaking out on sustainable development or social justice issues.

The notion that executives should take positions on contentious issues ranging from immigration to vaccination has become normalised. One C-suite networking group, World 50, reported last week that 95 per cent of its members felt that the pressure to do so had grown over the past three years. Now, though, we are also seeing a backlash to business activism, deepening suspicion of corporate money in politics and a shift in the political debate.

US companies have for decades written cheques to politicians on both sides to buy access and advance their interests, notes Joe Zammit-Lucia, author of The New Political Capitalism. But he adds: “The things that are relevant to businesses’ self interest are now subsidiary to the culture wars. So you might be buying access, but access to what? . . . Nobody wants to spend $10mn buying access to being involved in the abortion debate.”

Instead of securing influence with those in power, businesses are becoming “political proxies”, warns Columbia University management professor Vanessa Burbano: useful props in the culture warriors’ crowd-pleasing performances. Perhaps because Burbano’s research suggests that companies’ public statements on polarising political topics also tend to generate more blowback than approval, some business leaders are now wondering whether to lie low.

Board members are saying “maybe we have to pull back”, says Johnny C Taylor Jr, chief executive of the Society for Human Resource Management: “After the Disney incident, more and more CEOs are going back to the way it used to be.”

Notably, just one in 10 large US companies made a public statement after the Supreme Court’s abortion ruling, according to the Conference Board; most preferred to quietly adjust their healthcare benefits. Paul Washington, who runs its ESG centre, argues that companies should focus more on “bread and butter issues of economic fairness and security”.

But simply putting out fewer press releases will not guarantee a quiet life: business leaders should also think hard about the activists’ contention that their funding has enabled a style of politics that many mainstream executives privately loathe.

“If these companies want to stop being political punching bags they need to align their political giving with their stated values,” argues Evan Feeney, Color of Change’s deputy senior campaign director. Too often, he says, “there’s a disconnect where companies say they support access to abortion [or] they support democracy but they fund candidates who are opposed to those values”.

Recent polling shows that even Republicans are more concerned about corporate influence corrupting politics than about companies taking “woke” positions. That suggests that chief executives may have less to lose by curtailing their political contributions than by perpetuating spending habits that are buying them more trouble than influence.

With bitter elections approaching this November and again in 2024, it would be naive to think that America’s culture wars will subside any time soon — or that corporations can win them.

But navigating the territory will require new political skills from business leaders, a different approach to the money they spend on politics and fresh thinking about what to demand in return.

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