Business response to the immigration ban
On January 27, 2017, President Donald Trump issued an executive order temporarily banning travel to the United States, initially from seven predominantly Muslim countries that was later reduced to six countries. The action sparked protests around the country and the world, including responses from more than 100 companies and their CEOs.
Due to our ongoing research on CEO Activism, we examined corporate reactions to the president’s executive order. To do this, we developed an inventory of corporate and CEO responses to the order and began tracking these responses on a daily basis. We analyzed them based on several criteria, including content and form of distribution. As of February 28, we had collected 153 such responses and share a summary of the response composition below. I thought I ‘d share what we learned on my blog. [Many of the CEO responses we collected were excerpts or quotes provided from the media. Therefore, we have limited access to full messages and it is possible that these numbers could be higher. Percentages are based on what we have access to.]
One of the interesting shifts we saw from the numbers below was that CEOs spoke up against the ban but also took action by going beyond a statement and donating funds to an organization or charity.
+ 84% were issued by CEOs
+ 81% came from companies headquartered in “blue” states (i.e., leaned Democratic in the 2016 presidential election)
+ 73% voiced a clear, definitive opinion against the ban
+ 51% were issued by companies in the technology sector
+ 48% took action beyond issuing a statement (e.g., donated to charity, non-profit or filed legal documents)
+ 31% were issued by companies on the 2017 Fortune Most Admired list
+ 10% were non-U.S. companies
In terms of content, the messages from CEOs included these terms below. Defense of diversity and inclusion was the clear message as to why CEOs spoke up against the ban. Global talent is critical to company success and CEOs know that finding the best talent from wherever they come from is at the top of their agendas. CEOs also leaned on their corporate values for making the decisions they did to speak up publicly. Nearly all companies now have values they expect employees to work by and if they were in jeopardy, leaders had to speak up for them. Diversity and values were important factors in CEO activism this time around. Also of note, the majority (73%) did not mention the president by name, presumably to avoid being called out:
+ Diverse or diversity: 51%
+ Value or values: 37%
+ Trump: 27%
CEO messages were delivered in a variety of ways as indicated below. I found it fascinating that employee memos were at the top of the list indicating that CEOs saw their statements about opposing the ban as CEO-to-employee communications first and foremost. Of course, anything internal is external but their first public statements were meant for employees. As I have mentioned before in this blog when talking about CEO activism, CEOs today are more accountable to their employees (and other stakeholders) than years ago. If employees do not agree with their CEOs, they will use social media to disagree or consider leaving the company. One article I just read said that employees are the new whistleblowers. I also found it interesting that CEOs and companies used their social networks to get the word out. It was the third largest way that criticism of the ban was broadcast. CEOs are not so illiterate when it comes to social media.
+ Joint amicus brief: 38%
+ Employee memos: 37%
+ Social networks: 28%
+ Media statements: 15%
+ Joint open letter: 13%
+ Statement on company website: 11%
+ Media interview: 7%
Less than 5% included public speeches, CEO blog posts, customer emails, etc.
CEO activism has its rewards and risks, as our research shows. And we have definitely entered into a new stage of this phenomenon. You probably have read about Starbucks CEO Howard Schulz who criticized the ban and pledged to hire 10,000 refugees (adding action to his words) as a result. A boycott ensued afterwards. When Schultz addressed the issue last month, he responded this way about the boycott’s effect on the company’s business: “I can unequivocally tell you, and we all know this from the research we’ve done, that there is zero, absolutely no evidence whatsoever that there is any dilution in the integrity of the Starbucks brand, reputation or our core business as a result of being compassionate.” Corporate compassion is a nice way of putting it.