TROUBLING TREND: Business for America survey shows companies face more political backlash for social advocacy

By Marilyn Odendahl

The Indiana Citizen

November 24, 2023

Along with taking care of customers and tending to the bottom line, businesses increasingly are expecting to be attacked over culture war issues, according to a new survey recently released by Business for America.

Companies that are swept into a political backlash can suffer severe consequences, the survey said. They can be targeted for consumer boycotts of their products, they can face a public relations crisis and they could be subjected to special laws and regulations enacted solely as punishment by politicians who want to score points with their political bases.

“The takeaway here is that backlash is growing,” Sarah Bonk, founder and CEO of Business for America, said. “And it’s becoming more precarious for companies to take action on a variety of social and political issues that they and their stakeholders care about.”

Business for America, a nonpartisan, nonprofit organization focused on improving civic participation and voter turnout, surveyed more than 50 business leaders from around the country to learn what it could do to help civic-minded companies navigate the current political environment. The business leaders were asked their views of the culture wars, how the risk of a backlash was affecting their social impact work and what resources they needed to navigate these issues.

In a recent webinar, Business for America released its findings in its report, “Business Perspectives on Political Backlash.”

Bonk emphasized the results could not be applied across the entire business sector, because the survey was not scientifically randomized and presented just a sample of the Business for America network. Still, she said the findings – gleaned from responses from leaders of Fortune 500 companies to small-business owners – had merit because they were a “very helpful indicator of business concerns.”

The survey found a growing concern about getting caught in a political backlash sparked by taking action on social issues. A whopping 89% of the respondents agreed that attacks on business from political figures are at an all-time high, while 93% agreed the attacks are driven by political agendas and not by a genuine desire to solve problems.

“At the root of the issue is America’s dysfunctional hyper-partisan politics,” Bonk said.

Underscoring how sensitive business leaders are about political backlash, Bonk said several of the respondents asked to have the survey invitation sent to their personal email addresses rather than their company email.

‘Sign of democratic decline’

Protect Democracy, a nonpartisan, nonprofit dedicated to strengthening American democracy, sees the survey results as indicating a wider assault on the country’s founding principles.

Speaking as part of the webinar, Corey Dukes, policy advocate at Protect Democracy, highlighted a change in the political climate within the past 10 years.  He pointed out businesses and their leaders have long taken stances on public policies or social issues – and political leaders disagreeing and criticizing those stances has been normal as well.

“However, we are seeing with increasing frequency something different and more troubling to folks like us at Protect Democracy. We’re seeing officials at all levels of government using powers of the state to target private companies for either real or perceived expressions of viewpoints,” Dukes said, adding the tactic has accelerated greatly since the Trump administration. “Importantly, what we’ve seen in the last few years, too, is that no company is too big or too small to avoid being in the crosshairs.”

Both Democrats and Republicans have threatened action against private businesses. Examples include Florida Gov. Ron DeSantis, a Republican, installing his own appointees to the district board which oversees municipal services at Disney World in Orlando, after Disney officials criticized the state’s “Don’t Say Gay” law. California Gov. Gavin Newsome, a Democrat, briefly refused to renew the state’s contract with Walgreens, when the retailer stopped selling the abortion pill mifepristone.

Indiana Attorney General Todd Rokita has been on the forefront of some of the culture war battles with big business.

In May, Rokita co-led 17 Republican attorneys general in a fight over ESG (environment, social and governance) policies by asking the Federal Energy Regulatory Commission to review BlackRock’s holdings in utility companies. He accused the investment firm of embracing what he called “radical leftist ideologies,” after BlackRock signed on to the environmental initiatives of Climate Action 100+ and Net Zero Asset Managers.

Rokita followed that by joining 12 other attorneys general in July and sending a letter to Fortune 100 CEOs threatening that their companies would be “held accountable – sooner rather than later” if they continued to pursue DEI (diversity, equity and inclusion) goals in hiring and contracting. The letter cited the U.S. Supreme Court’s 2023 decision in Students for Fair Admissions v. President & Fellows of Harvard College, which struck down affirmative action in college admissions and said the prohibition extended to other aspects of life, such as employment.

Aisha Woodward, policy advocate at Protect Democracy, said government actors retaliating against private businesses is a problem that impacts the entire country.

“Using government power to target and retaliate against businesses for expressed viewpoints is a known sign of democratic decline,” Woodward said. “These kinds of attacks can create a permission structure for other political leaders to copy that behavior and can result in a chilling effect on free speech and expression.”

Scoring political points

Business leaders told Business for America the issues they see as making their companies most vulnerable to government attack are DEI hiring and training practices, ESG investing, and LGBTQ+ issues.

The survey found many companies are adjusting their approach to social impact work, although none of the respondents said they had made “significant reductions” in that work. A majority of the respondents, 68%, said they had not changed their social impact activities, while 19% said they were increasing their social impact work and 13% said they were decreasing the work.

Richard Eidlin, national policy director at Business for America, believes politicians who attack companies have lost sight of the importance of a thriving business sector.

“I think that certain elected officials have somehow reversed in their mind the impact of an attack on business as an employer and the benefits that that company brings to a given community from their much narrower political agenda,” Eidlin said. “Their political agenda is the most important thing on their mind and if there can be a political point scored with a cross section of the public, that takes precedent.”

Looking ahead to 2024 and the heightened divisiveness brought by the presidential election, Business for America is launching a new initiative especially to help businesses prepare for political backlash. Once a month, the organization will host a private forum where business leaders can gather to review case studies, exchange best practices, share messaging and discuss policy.

Bonk certainly does not foresee the backlash abating.

She linked the volatile political atmosphere to news stories “optimized for clicks,” social media fueling outrage, election systems that drive divisiveness through closed primaries and gerrymandering, and partisan politics that reward extremism. In the “absence of leadership from our elected leaders,” Bonk said, companies are under growing pressure from grassroots organizations, shareholder activists and investors to either take action or stop taking action, depending on the circumstance or issue.

“Today’s toxic, hyper-partisan political climate is pouring sugar into America’s economic engine,” Bonk said in a press release. “Our country remains in a post-pandemic economic downturn, and we cannot afford to have politicians hamstring business by weaponizing every social issue and attempting to restrict free speech.”

FOOTNOTE: Dwight Adams, a freelance editor and writer based in Indianapolis, edited this article. He is a former content editor, copy editor and digital producer at The Indianapolis Star and IndyStar.com, and worked as a planner for other newspaper