Americans have clear reservations about corporations straying too far into politics, according to a new survey from Global Strategy Group.
The study found that more than 7 in 10 adults (72 percent) agree it is important for businesses to take action to address important issues facing society, and even more (78 percent), believe it is appropriate for companies to take a stance on a political issue facing their industry.
However, Americans have clear reservations about corporations straying too far into politics. A majority of those polled (56 percent) think it is inappropriate for companies to take a stance on political issues if it does not pertain to their business, and less than one-third (31 percent) believe it is appropriate for companies to take positions on sensitive social issues such as abortion or same-sex marriage.
“Over the past year, we have seen numerous examples of corporations like Starbucks, Chick-fil-A and Whole Foods publicly weighing in on political and social issues,” says Alan Sexton, executive vice president, GSG. “Some brands receive public support and end up unscathed, while others are left scrambling to protect their reputations.”
GSG’s study also gauged perceptions about specific public stances taken by corporate brands on a variety of political and social issues, including immigration and health care reform, same-sex marriage and endorsements of specific political candidates. The study found a disconnect between what the public thinks is appropriate in theory and what they find appropriate in real-world practice.
For example, only 31 percent agreed, in theory, that it is appropriate for companies to take positions on social issues. However, when provided with a real position taken by retail giant Nordstrom in support of same-sex marriage and partner rights, 68 percent found this statement appropriate. Likewise, only 29 percent believe it is appropriate for CEOs to speak for and endorse a political candidate on behalf of their company. Yet 53 percent thought Staples CEO’s support of Republican Presidential Candidate Mitt Romney was appropriate.
“In the real world, the public evaluates the appropriateness of a company’s political stance from a variety of angles, including its relevance to the company’s business, the substance of the issue and how it’s positioned by the company,” says Nick Gourevitch, senior vice president and director of research, GSG. “Often what is an unpopular action, in theory, becomes more acceptable if well-positioned and put in the context of the company’s business.”
GSG’s study also evaluated the public’s perception of corporations’ political brands by asking respondents to identify the politics of specific companies as though they were individuals:
• Corporate political identity is correlated to a corporation’s brand favorability.
• Companies that are seen as being strongly partisan earn lower favorability ratings.
• Companies perceived as “nonpartisan” and in the middle of the political spectrum enjoy some of the highest levels of favorability.
• Individuals give higher favorability to companies that they perceive to align with their own political party.
The study uncovered another significant reputational consideration. Among those who disagreed with a company’s political stance, corporations experienced a huge 42 point drop in favorability. Meanwhile, there was no comparable rise in corporate brand favorability among those who agreed with the position.
On the whole, voter awareness of actual political stances taken by companies is very low. Of all the positions tested, awareness levels were generally below 29 percent, and many were much lower. There was one exception to this trend: 66 percent were aware of Chick-fil-A CEO Dan Cathy’s controversial position on same-sex marriage.
“These are big indications for companies considering wading into political waters to test those waters first,” says Gourevitch. “If people disagree with a position, it’s bad for brand favorability—and could be very bad for business. Likewise, if a position is controversial, companies need to be ready for it to become a very public position. Corporate leaders and their communications departments need to be aware of public opinion.”