(Bloomberg) -- Now, more than ever, corporate leaders are expected to respond to political issues affecting their employees and customers. Executives at the Bloomberg Equality Summit this week didn’t think that was always the best idea.
“We weigh in when we can move the ball forward,” said Beth Ford, the CEO of Land O’ Lakes Inc. and one of the few openly gay company leaders. “Not everyone wants to hear my point of view or the companies on every issue.”
Over the years, expectations for companies to advocate for social issues, such as marriage and gender equality, has grown. By the time George Floyd was murdered by Minneapolis police in May 2020, staying silent was a bigger risk than taking a stand, for many CEOs.
Still, some signs point to waning corporate engagement. A Bloomberg analysis of corporate earnings calls in the second quarter of this year showed that discussion of diversity issues had nearly disappeared after peaking in the July 2020.
“We’ve made some progress trying to figure this out, what’s appropriate, and what’s inappropriate, and how you might think about it,” said David Larcker, a professor at the Stanford Graduate School of Business, who studies CEO activism. He thinks boards should have a defined strategy of when and how to respond, or at least a clear policy on how to discuss political issues. “There’s a long way to go.”
Dow Inc. CEO Jim Fitterling said he weighs in on issues that ensure equality for Dow’s workforce in the markets where the chemical company does business. Issues such as marriage equality, access to health care, and taxes are particularly relevant for him, he said.
Reid Hoffman, the co-founder of LinkedIn and now partner at Greylock Partners, said company leaders should speak up on moral issues. In some cases, he does so as an executive on a formal work-related platform. In others, he takes to Medium to express his opinion as a private citizen.
Ray McGuire, former New York City mayoral candidate and ex-chairman of Citigroup Inc., said companies have to keep up the work long term.
“I look at the representation, the demographic ratio, gender representation in the financial services industry at large, it still has enormous work to do,” he said. “Private sector can’t sit on the sidelines. Acquiescence and complicity is not acceptable in a world where we’re facing two existential crises, climate and wealth gap. The private sector cannot abdicate its responsibility.”
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