Saturday, March 3, 2018

The Mad New Trend of Corporations Taking Cultural Positions

By Aaron K. Chatterji

In the wake of the school shootings in Parkland, Fla., companies like Delta, Hertz and Symantec distanced themselves from the National Rifle Association by eliminating benefits to their members.

Dick’s Sporting Goods, which owns 35 Field and Stream stores (which feature hunting gear and supplies), took it a step further: The company announced that it had unilaterally raised the age limit for firearms sales and stopped selling the AR-15, the weapon used in Parkland and other recent mass shootings. The chief executive, Edward Stack, said that the company was “going to take a stand and step up and tell people our view and, hopefully, bring people along into the conversation.” Less than 24 hours later, Walmart joined Dick’s in raising the age limit on firearm sales (Walmart stopped selling AR-15s years ago).

They exemplify a recent phenomenon, “C.E.O. activism,” in which corporations and their chief executives pick a side in the culture war.

Some companies have benefited, through gains in popularity or even sales, by taking such stands. Patagonia reportedly saw a revenue surge after announcing its lawsuit against the Trump administration’s efforts to slash the size of Bears Ears National Monument in Utah. My research with Michael Toffel of Harvard Business School finds that consumers were more likely to buy Apple products after hearing Tim Cook’s statement opposing Indiana’s religious freedom bill.

But other firms have faced angry consumers and had to retrench, as Target did when hundreds of thousands of people signed a petition in protest of its trans-inclusive bathroom policy. The chief executive of Papa John’s, who blamed the National Football League’s handling of the national anthem controversy for his company’s declining sales, stepped down after he was criticized for his comments.

What has not happened in any of these cases is a cooling of partisan tensions. Even in rare cases when pragmatic business leaders helped to broker agreements, which was reportedly the case in North Carolina with the repeal of the so-called bathroom bill, a culture war still festers.

Read the rest here.

Robert Wenzel note: 
This positioning by corporations on all kinds of cultural issues flies in the face of the economics of basic exchange in a civilized society. In a complex civilized society like we have, every day we complete a multitude of exchanges with everyone from store clerks, to delivery people, to the dry cleaner, etc., where we don't know anything about the extended views and opinions of those we are dealing with. The exchange is very limited.

We interact and exchange where we have something in common and don't go beyond that. It would be insane to carry around a checklist of pre-approved views before we interact with people on a very narrow basis. There are only a relatively few people that we have exchanges on multiple levels where we know a lot about a person.

This trend toward getting corporations involved in cultural issues that have nothing to do with the goods and services provided by the corporations is a vicious attempt at molding all of society in a particular direction. It is the opposite of live and let live. It is the opposite of liberty. It is the purview of the busybody who generally has no qualms about backing up his culturial demands with government guns. They should all go to hell. 


  1. Victor Davis Hanson has noted that tech giants cultivate a 'progressive' image to remain off the radar of regulators and those who seed them. So maybe it's a camouflage tactic.

  2. Robert, I didn't understand the relevance of your comments that "It is the opposite of liberty. It is the purview of the busybody who generally has no qualms about backing up his [cultural] demands with government guns."

    It seems as if this story was not about the state forcing companies to take particular positions, rather, it was about companies doing this voluntarily, as part of the entrepreneurial experiment of trying to satisfy their customers' preferences. Some of them may be making economic errors in doing so, and will suffer accordingly, but some of them may be successful with these moves. I might disagree with these corporate policies from a cultural perspective, but I don't see the liberty issue here.