After a decade that saw America’s biggest multinational corporations take public stances on issues from same-sex marriage to Black Lives Matter, a backlash has begun.
It’s coming from the left and the right. Conservatives are upset with companies that don’t share their views on social and political issues, while liberals are upset with companies that don’t follow up their words with action. There is an appetite in both parties to break up Big Tech.
This is what happens when “woke corporations” meet “cancel culture.” The changing politics of business is happening in the aftermath of an attempted insurrection that focused more attention to corporate political donations, and against that backdrop of a receding pandemic that reordered work. Workers demanding more of their employers, and consumers of their brands.
“People are going to start taking and holding companies accountable for their political actions a lot more than they have in the past,” said Brian Potts, co-founder of the nonpartisan data company Goods Unite Us, which shows consumers how much companies and their executives donate to political causes.
The company’s app is filled with surprises, like Nike, the company behind Colin Kaepernick’s polarizing and Emmy Award-winning “Dream Crazy” ad, actually leans slightly right in its giving, with 52% going to Republicans and 48% to Democrats. Big Tech companies tend to give overwhelmingly to Democrats, like Apple (89%), Facebook (85%) and Amazon (69%). Giving for both Fox News (70%) and CNN’s parent company WarnerMedia (63%) is majority Republican.
After the deadly Jan. 6 Capitol attack, companies including Marriott and Hallmark announced they would pause donations to those who voted against certifying the election. At the same time, downloads for the Goods Unite Us app surged, Potts said.
Watchdogs continue to keep an eye out for those who give to election objectors. Toyota topped the list in a report on corporate donations to members of Congress who voted against certification that was released Monday by the progressive group Citizens for Responsibility and Ethics in Washington. The automaker, which made 37 donations totaling $55,000 to “Sedition Caucus members” since Jan. 6, said in a statement to Axios that it did not believe it was “appropriate” to judge lawmakers only on their vote to certify the election.
Potts said the increased interest in corporate donations is due to consumers wanting to take political action in between elections, not just when they vote.
“Now, you can make sure that all of your expenditures, both on the investment side and on the consumption side, aren’t undermining your vote,” he said.
On the investment side, partisan-minded index funds promise investors shares of only companies that match their politics. On Election Day 2020, a fund called DEMZ launched using data licensed from Goods Unite Us. It’s made up on only companies that gave 75% or more of their donations to Democrats over the last three election cycles. There’s funds for Republicans, too, like the American Conservative Values EFT that promises to “boycott the worst companies that are hostile to conservative values.”
Political investing has further incentivized companies to bend to social pressure, said Richard Manning, president of the conservative Americans for Limited Government. Companies hoping to meet certain criteria for socially or environmentally conscious investors “have to do things with groups like Black Lives Matter and the like,’” he said.
The tipping point
Politicians today are quick to call out companies they don’t agree with. In April, Rep. Dan Crenshaw, R-Texas, accused Major League Baseball of “bowing to the woke mob” for moving its “Midsummer Classic” All-Star game from Atlanta to Denver over Georgia’s more restrictive voting laws. Rep. Pramila Jayapal, D-Wash., has spent June highlighting corporate Pride tweets from companies that have given to Republicans blocking the Equality Act.
Some politicians have even sworn off corporate PAC money. In a Wall Street Journal editorial in April headlined “Your Woke Money Is No Good Here,” Sen. Ted Cruz, R-Texas, said he won’t take corporate PAC dollars, and Sen. Josh Hawley, R-Mo., tweeted that he would follow suit.
The National Retailer Federation was not immediately available for comment on this story and the National Association of Manufacturers did not respond to a request for comment.
The long-term effect of shifting business climate is unclear.
“I think what you’ll see is a movement for objectivity, for corporations to be more responsive to their shareholders and to not get into the political game and not spend that kind of money lobbying and contributing,” said Jason Britton, CEO of Reflection Analytics, which built the DEMZ fund.
Perhaps companies and their executives will ease off the political donations and lobbying, or perhaps we’re headed to a new normal where shopping decisions are increasingly guided by party affiliation.
When it comes to the future of retail, Gen Z trends can show us what’s ahead, and for now, it doesn’t seem apolitical. Nearly three-fourths of the Gen Z respondents in the Long Dash brand report said they seek out information about a company’s values today more than they did six months ago.
For companies sweating over the increased scrutiny, there’s good news. When asked the best way a brand can demonstrate its values, the top Gen Z response in the Long Dash survey was focusing on “where the brand still needs to make progress in living up to its values.”
Next year’s midterms could show how much the corporate-political landscape has changed, particularly if companies get involved in primaries, or the boycott against election objectors continues. However it unfolds, things aren’t settled, said Potts, the Goods Unite Us founder.
“There’s going to be a tipping point,” he said. “I don’t think we’re at that tipping point yet.”
Correction: An earlier version incorrectly identified Long Dash as the in-house creative agency of the Atlantic magazine. Long Dash is a creative consultancy under Atlantic Media.