We’re used to athletes and celebrities sharing their opinions on political issues. But now we’re seeing waves of businesses, Fortune 100 companies even, wading into politics, caught in political crossfire, dealing with dueling boycotts, and embracing “cancel culture.”
I have a simple message for CEOs and board members when acting in their official capacities: Stay out of politics.
Don’t get me wrong. In their personal lives, business leaders have the same right to free speech as everyone else. Unfortunately, even making personal statements in today’s overly sensitive political environment can be risky.
For example, Goya CEO Robert Unanue recently expressed his personal opinion that the nation was blessed to have a leader like President Trump. But for saying nice things about the current President, the Goya CEO faces a boycott of his company.
That does not mean leaders should avoid exercising their rights, but they should not let those political opinions, or even the opinions of some group within the company, drive company policy or presume to speak for everyone employed in the company.
When they do so, they are no longer exercising their fiduciary duty to the company and its stakeholders. Likewise, when other companies act as if every business leader's private speech does represent the company, they make decisions to “cancel” one another’s businesses. Reebok and others did this, for example, cutting off business ties with CrossFit after a tweet by the CEO.
I fear many business leaders, CEOs, and board members alike are trampling boundaries intended to keep them from becoming political entities. Those boundaries between politics and business have existed for centuries for good reasons. To paraphrase G.K Chesterton’s famous fence analogy, if you don't see the use of these boundaries, go away and think before you attempt to destroy them.
In doing so, they risk at least three negative consequences.
First, they're likely to lose customers. By becoming political entities in a divided nation, they alienate at least half of the population. I ask business leaders, How is that fulfilling your fiduciary responsibility?
As someone who founded and built a company from start-up to revenues in excess of $1.8 billion over four decades, let me remind you that companies exist for the purpose of delivering a product or service to customers. Companies lose their way when they lose their focus on why they exist.
A second negative consequence when companies insert themselves into politics is that they become less diverse. When open debate and dialogue are replaced by group-think dictated by the whims of a political mob (either inside or outside of the company), people who disagree with those views won’t feel comfortable working there.
Building the enterprise value of the company requires providing a work environment that allows all of your employees to grow and feel safe in order to deliver their highest potential. Without those protections, leaders simply cannot maximize the value of the company.
When companies lose diversity of opinions and perspectives inside your company, they create a bubble effect that disconnects them from half the talent pool and innovators. I ask business leaders, How does that make your organization healthier?
Finally, and perhaps most importantly, when companies engage in cancel culture against other businesses based on perceived imperfections in another company’s leaders, they set a self-destructive precedent. The same cancellation forces they seek to satisfy today may just as easily come for them tomorrow.
And once they support an economic boycott of another company, why wouldn’t they expect that same action to be taken against them? I ask business leaders, How does that fulfill your duty to your stakeholders to strategically protect the value of your company?
Lest you think business leaders need not fear these consequences, consider what has happened of late to Facebook when it was deemed to have not gone far enough in policing content according to the Left’s cancel culture. Based on what appears to me to be a progressive track record, you might think that Facebook would be immune to such pressures. Yet, their past political bona fides didn’t matter when a litany of companies pushed their political views onto them by pulling ad money if they did not up their game in terms of censorship.
Clearly, these times will test the resolve of corporate leaders to put their companies’ best interests above their own personal opinions.
As one business leader to another, my advice is simple: Keep your company neutral in politics. Focus on delivering the highest value product or service. Have the backbone to stand up to the forces clamoring for your company to participate. Your stakeholders, customers and the entire nation will thank you for it.
Jeff Webb is an internationally renowned entrepreneur, founder and former Chairman and CEO of Varsity Brands, president of the International Cheer Union, and a business, politics and cultural commentator. His commentary has been featured in Newsweek, The Washington Times, Forbes, ESPN, and more. Follow him on Twitter and Facebook.