FIGURE 3 Democrats Are More Supportive of Corporate Involvement in Social Issues


Republican


Support Environment/ Sustainability


Democrat 75%


Ending Discrimination by Gender


57%


Support Access to Quality Education


69% 74%


Ending Discrimination by Gender Identity


53% Ending Hunger/ Supporting Food Security 50%


Consequently, businesses in Republican states— 69% 74%


Ending Discrimination by Race


43%


Supporting Affordable Housing


56% 67% 43% 72% 51% Improving Voting Access 61% 34%


particularly Texas and Florida—have faced a political backlash from Republican governors and legislatures when they have taken actions deemed too “woke.” In 2022, for example, the largest pension fund in Texas divested its direct ownership stakes in BlackRock and other financial firms to comply with a state law prohibiting investing in companies deemed to be discriminatory against the oil and gas industry. In Florida, because Disney expressed its oppo- sition to the state’s so-called “Don’t Say Gay” bill, Governor Ron DeSantis conducted a campaign to limit the autonomy of Disney World. Anti-corporate actions such as these not only


Ending Discrimination by Sexual Orientation


71% 50% Supporting DACA 58% 32% Supporting Human Rights 70% 46%


Supporing Legal Access to Abortions


54% 27%


affect a firm’s reputation; they can also create a hostile political environment. That results in real-world costs. According to Valuation Research Corporation, the total value of “goodwill” assets (the value of the loyalty of a firm’s customers) on the balance sheets of S&P 500 companies is $3.57


Political history supports the notion that the Republican Party is


“Te Party of Business.” Over the years Republicans have embraced regulatory reform, corporate tax cuts, free markets, “right to work” laws, and economic growth—all political stances that favor business. But in the 2023 Public Affairs Pulse survey, it was striking


how strongly Democrats supported corporate efforts to engage politically on social issues and how strongly Republicans opposed them. Tese trends are illustrated in Figure 3. For example, 72% of Democrats said major companies should be involved in resolving racial discrimination issues, but only 51% of Republicans agreed. Tis spread (21 percentage points) was identical for discrimina- tion based on gender and sexual orientation, and even greater for gender identity discrimination (31 points). Tere were also large spreads for voting rights (27 points) and


human rights issues (24 points), for providing access to quality education (19 points), for improving the environment (18 points), for increasing affordable housing (24 points), and even for alleviat- ing hunger (13 points). Not surprisingly, opinions dramatically diverged when re-


spondents were asked about business involvement in immigration reform and the abortion issue. While 58% of Democrats supported corporate advocacy for Te Deferred Action for Childhood Arrivals (DACA), only 32% of Republicans wanted companies involved. Regarding abortion, 54% of Democrats thought major companies should be engaged in the debate over abortion rights, but only 27% of Republicans agreed.


niri.org/ irupdate trillion. That’s a lot of intangible value to protect.


Success Strategies How can public company executives manage these shifting politi- cal winds? Smart companies have learned how to balance the needs and


expectations of different stakeholders. Tey are active in their com- munities and take pride in their efforts to serve the public interest. Tey monitor political trends, develop allies, and plan beforehand how they will respond to different scenarios. Tey know how to pick their battles. Tey understand the dangers of overreacting to attacks from dishonest or irrelevant critics. Tey also have processes in place to prioritize and manage issues,


coordinate communications and public affairs strategies, and give careful thought before engaging in actions that could be controversial. Most important, smart companies make a point of doing these


things with humility, integrity and authenticity. In other words, they refuse to play the part of a large, greedy and faceless corpora- tion. It may be a dangerous world out there, but it is also a world in search of humanity. IR


Douglas G. Pinkham is President of the Public Affairs Council, a nonpartisan and nonpolitical association serving more than 13,000 public affairs professionals in companies, associations and other nonprofit organizations in the United States and around the world. More information is available at www.pac.org.


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