Why brands & businesses have more responsibility than ever before to take stands on social issues

by | Sep 24, 2020 | Public Relations

As a more profound cultural consciousness pervades society, consumers have been demanding that brands and businesses hold themselves to a higher standard of purpose—and likewise, reputation-minded executives have too recognized the need for their companies and industries to be better stewards of community service. This sense of purpose has only been strengthened in the COVID age, but new research from comms giant Porter Novelli reveals many execs feel significant barriers, like pleasing too many stakeholders with differing views, are curtailing their efforts—and transforming the purpose movement into a major challenge for Corporate America.

More than 8 in 10 (83 percent) execs today feel an urgency for business to be a critical part of driving solutions to some of today’s most pressing issues, such as COVID-19, racial injustice, and economic resurgence, according to the newly released 2020 Porter Novelli Executive Purpose Study, which  examines business leaders’ opinions on purpose-driven leadership and how business should engage on issues like social justice and diversity, equity and inclusion (DE&I) within the context of 2020’s rapidly changing environment.

“It’s clear the events of this year have fundamentally changed the business environment—as well as the role of business in society,” said David Bentley, CEO of Porter Novelli, in a news release. “There is more urgency than ever before for business to be a leading player in solving for critical global issues—and smart leaders recognize taking a stakeholder-first lens is not only good for society and communities, but also for business and bottom lines.”

Why brands & businesses have more responsibility than ever before to take stands on social issues

Mirroring this mindset, the majority (85 percent) of business leaders today agree it is no longer acceptable for companies just to make money; companies must positively impact society as well. Further, executives are eschewing an investor-only focus—with more than nine-in-10 (91 percent) stating that business must benefit all stakeholders, not just shareholders.

Executives agree leading with purpose drives profit

As more companies turn to stakeholder-centered business, executives understand this is not simply about “doing the right thing”, it is also a sound business strategy. Nearly nine-in-10 (89 percent) business leaders today believe companies that lead with purpose have a competitive advantage in today’s marketplace. In fact, 85 percent agree being a purpose-driven company drives profit.

Beyond heightened profitability, executives also identify a number of other business benefits of leading with purpose. Nearly all executives (99 percent) see the reputational advantages of responsible business—and the majority also cite employee recruitment and retention (95 percent) and increased consumer trust (93 percent). Additional benefits include:

  • Increased customer loyalty: 93 percent
  • Likelihood to recommend: 92 percent
  • Likelihood to purchase: 91 percent
  • Differentiation from peers and competitors: 88 percent
  • Improved financial performance: 83 percent
  • License to operate: 65 percent

“This year is anything but ‘business as usual’,” said Bentley. “Yet, this research proves executives understand this time of immense crisis has also created a moment to build back the business community as a more vibrant, inclusive, innovative, and profitable endeavor that serves all stakeholders instead of just shareholders. Purpose-driven business is smart business, and now is the time for executives to eliminate barriers and take a stand. It’s time for action, plain and simple.”

COVID-19, racial injustice put business mandate in new focus

The events of the past six months have only put this mandate into clearer focus, as 88 percent of business leaders believe now more than ever, companies must lead with purpose. Many feel a responsibility to fill an emerging leadership vacuum—with eight-in-10 (80 percent) believing that due to the lack of government regulation and progress, business has more of a role than ever to address pressing social and environmental issues. A similar amount believe business is uniquely equipped to solve these issues—with 81 percent noting business has the scale, speed and acumen to solve the issues facing society today—including COVID-19 and economic resurgence.

The concept of protecting the world from coronavirus. Hands protects the globe from viruses against the backdrop of a sunny sunset.

“We’ve tracked consumer expectations of companies during the pandemic and around topics like racial injustice since the onset of the crisis. It’s clear that Americans believe companies must play a central role in building solutions for today and tomorrow,” said Kate Cusick, CMO at Porter Novelli, in the release. “Now, this research proves that business leaders not only acknowledge this mandate but are also ready to take the reins and run.”

Business + social justice—where executives stand

As 2020 continues to shed light on a long, painful history of racism and disparities in the U.S., business executives are prepared to engage. Recent Porter Novelli research has found that seven-in-10 (70 percent) Americans today believe companies have more responsibility than ever before to address social justice issues—and business executives (73 percent) echo this fervor. A similar amount (71 percent) understand that to truly be purpose-driven, a company must be willing to take risks to address social justice issues—a figure also in alignment with the American public (72 percent). Just a third (36 percent) of business leaders today say business should focus on business, not social justice.

On the specific issues business leaders feel they have a role in addressing, issues closer to their everyday business and operations are the priority. Executives rank sexual harassment (97 percent), employee health and safety (95 percent), racial equality (93 percent) and women’s rights (89 percent) as the top issues active in the news today that companies must address. Additional issues include:

  • Access to healthcare: 87 percent
  • Domestic job growth: 86 percent
  • Privacy and internet security: 84 percent
  • LGBTQ+ rights: 78 percent
  • Immigration: 63 percent
  • Climate change: 61 percent
  • Voting rights/access to voting: 55 percent
  • Cost of higher education: 43 percent
  • Fake news: 37 percent
  • Gun control: 31 percent

“While most executives recognize the need to engage, our benchmark research indicates average Americans are even more fervent in their belief that business should be prepared to solve for myriad social justice issues plaguing society today,” said Cusick. “In order to drive change, Corporate America’s C-suite need to get outside their comfort zones in addressing these diverse issues that are now an expectation of consumers, employees and other stakeholders.”

Young businessman working on a virtual screen of the future and sees the inscription: Our vision

Specifically, on the topic of racial equality, three-quarters (76 percent) of executives recognize business’ role in systemic racial inequality—mirroring the national average. Even more (85 percent) understand their responsibility as business leaders to speak out about injustices. Yet, executives know part of the journey forward is to also acknowledge the past. Another six-in-10 (60 percent) want to be more proactive about sharing previous mistakes or biases rather than waiting for someone else to publicize them—and just a third (33 percent) concede they are nervous to take this step.

But barriers remain to taking stands on social justice issues

Even as the majority of business leaders today acknowledge business can play a critical role in addressing the many social justice issues, barriers remain to further pursuing these topics. When asked what prevented leaders from taking a stand of social justice issues, leaders cite the number of stakeholders all wanting different things (43 percent) as the primary reason. Other top reasons include concern that their company hasn’t done enough internally to take a stand (28 percent), too many issues (27 percent) and a hesitancy to invite retaliation from different stakeholder groups (27 percent).

Risk Management and Assessment for Business Investment Concept.

Other barriers executives cited include:

  • Board and key decision makers are too risk-averse: 25 percent
  • Company already has a signature cause/issue, don’t want to detract from that work: 24 percent
  • Afraid consumers or other stakeholders will negatively call their company out for not being “authentic”: 21 percent
  • Don’t feel their company has a role in taking stands on these issues: 21 percent
  • Consumers expect immediate action and their company can’t respond quickly enough: 19 percent
  • Company doesn’t have the money or resources to make an impact on these issues: 15 percent
  • Issues are moving too quickly for their company to be thoughtful in its response: 14 percent
  • Don’t know where to start in addressing the myriad pressing issues: 14 percent

“Executives today acknowledge the complexity of taking a stand on a potentially delicate issue—from recognizing different stakeholder priorities and understanding they must do work internally to justify leadership,” said Cusick. “Here we see how these hurdles can quickly become insurmountable barriers for companies that do not already have a strong vision and Purpose to guide them.”

Business leaders cite DE&I as a moral and business imperative

As business leaders look to tackle tough social societal problems, they understand having a diverse and vibrant workforce is one step forward. Executives today recognize the value of powerful diversity, equity and inclusion (DE&I) strategies—nearly three-quarters (73 percent) believe DE&I is a moral and business imperative that drives profit, and only a third (35 percent) of executives today say DE&I isn’t a core business priority for their company. Executives (84 percent) are also significantly more likely than the average American (69 percent) to believe a company cannot be truly purpose-driven without having strong DE&I values—showing how leaders understand that purpose and DE&I are inextricably linked.

Human chain paper with light and shadow on wood table

Leaders also acknowledge there is much work to be done in this space. Nearly nine-in-10 (89 percent) executives say companies need to make more progress on advancing DE&I in the workplace—compared with 76 percent of Americans overall. Two-thirds (65 percent) take this personally, admitting they need to make DE&I more of a priority at their company.

Porter Novelli fielded a survey to gather insights regarding Purpose-driven companies and social justice. The U.S. business executives survey was fielded online via GLG between July 21 and July 24, 2020, and a total sample of 150 business executives was collected. 

Richard Carufel
Richard Carufel is editor of Bulldog Reporter and the Daily ’Dog, one of the web’s leading sources of PR and marketing communications news and opinions. He has been reporting on the PR and communications industry for over 17 years, and has interviewed hundreds of journalists and PR industry leaders. Reach him at richard.carufel@bulldogreporter.com; @BulldogReporter


How PR drives success in travel and entertainment

How PR drives success in travel and entertainment

In today's experience-driven economy, the travel and entertainment industries can only thrive when they're able to capture the imagination of the public. Whether it's a luxurious getaway in an exotic destination, a heart-pounding adventure tour, or a blockbuster film...