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July 7, 2022
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Photo by Pexels user Derek French

Corporations and social politics

In the past few years, it has become clear that businesses can no longer remain silent on social issues. When the Supreme Court handed down its decision overturning Roe v. Wade, a lot of businesses immediately responded by putting out statements that they would support their employees by covering travel expenses for abortions.

Let’s look at why some businesses may have responded so quickly and what other ways businesses and the government have been interacting on social issues that business journalists need to cover.

Employee pressure leading the way

Large corporations have been speaking out in the last few years, partly due to public pressure, but more importantly, pressure from their own employees. Earlier this year Disney apologized to its employees for not taking a public stance sooner in response to Florida’s Parental Rights in Education Bill.

In February, Spotify apologized to its employees who spoke out against the Joe Rogan Experience podcast the platform carries and said that although they would not remove him entirely, they would invest $100 million in content from historically marginalized groups.

Companies can no longer ignore calls from their own employees to do more. And in a time when businesses are struggling to retain and attract new talent, values may be a way for companies to do just that.

Comparing business responses to past legislation and the government’s response

Covering travel expenses for employees needing to travel out-of-state to terminate a pregnancy is not the same thing as taking a stance on abortion. Especially when companies hedge with phrases like  ‘to the extent permitted by law’ that companies like Meta, Wells Fargo, and Ford Motor put into their public statements. Although caring for employees is important, it is not the only way businesses have the capacity to make a change that will impact their employees’ well-being. Take for example, past business responses to other state legislation on social issues.

The MLB pulled the All-Star Game from Atlanta in protest of a new restrictive voting law last year and a Will Smith production pulled filming out of the state. Other companies based in Georgia also spoke out against the legislation, prompting state lawmakers to threaten to rescind tax breaks like the one that saves Delta Air Lines millions each year. Similarly, the 30 largest companies in Michigan released a statement opposing changes to Michigan election laws that would reduce participation in elections.

The NFL moved the Super Bowl out of Arizona in 1990 due to its refusal to make Martin Luther King Jr. Day an official state holiday and threatened to do the same in 2014 in response to the state senate passing a bill that would allow businesses to refuse service to gay people for religious reasons. The bill was vetoed by the governor, likely due to pressure from the business community in Arizona.

Additional angle to explore: States using social issues to recruit businesses

California, New Jersey, and Connecticut are among the states making pitches to businesses to consider relocating to their states, but not with the usual tax breaks and incentives. For example, the New Jersey governor recently sent letters to seven companies in Georgia stating the anti-abortion laws would hamper the companies ‘ability to attract and retain top female talent.’ Last September the Connecticut governor made a video plea to companies in Texas, after their six-week ban went into effect, stating that “…we have one of the most productive, best trained, most innovative workforces in the world. And that starts with the fact that we have more women participating in our workforce than just about anywhere else.”

Although it is unlikely these pleas for companies will persuade a company to relocate, it is worth keeping an eye out for what companies do next. As Politico pointed out, if states start penalizing any of the businesses that are announcing that they will pay for an employee’s out-of-state abortion, as a representative from Texas threatened Tesla, a company may reconsider its options. Especially if states offer up business incentives to do so, such as the way California is giving extra consideration to businesses that are willing to relocate from states with anti-abortion and anti-LGBTQ+ laws.

Businesses have been making calculated decisions for years on whether taking a stance is economically worth it, and business journalists should cover this topic. Sports teams pulling out of one state to take their business to another does little to affect their bottom line if public sentiment is on their side. Although Delta made an initial statement on voting rights, it may not be coincidental they chose to not sign on to a joint statement with other businesses condoning the law any further after a threat of financial retribution from the state.

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