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A New Framework for Corporate Activism

Cathay Pacific CEO Rupert Hogg was forced to resign after his airline (30 percent owned by Air China) was accused by Beijing of not doing enough to reign in employees who showed support for Hong Kong’s pro-democracy protests.

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Knowing when – and how – to appropriately speak out on political issues is becoming a core skill for business leaders.

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It is not always easy. Given how politically polarised the world has become, taking a stand can have financial implications and put companies in a difficult position alienating customers, employees and other stakeholders who hold the opposing view. This is on top of longstanding questions about the legitimacy of unelected executives’ participation in politics. Sometimes, however, they are dragged into political debate.

Cathay Pacific CEO Rupert Hogg was forced to resign after his airline (30 percent owned by Air China) was accused by Beijing of not doing enough to reign in employees who showed support for Hong Kong’s pro-democracy protests.

The airline’s shares plunged to 10-year lows, rebounding only after it condemned the protests and vowed to follow Chinese aviation regulations.

Delta Airlines in the US faced similar pressure: US$50 million in tax benefits was pulled after the airline eliminated a discount programme for National Rifle Association members following the horrific high school shooting in Parkland, Florida.  (In fact, the decision reflected the airline’s “neutral status in the current national debate…

Bold or cautious – what action should you take?

As the chaos and uncertainty of Brexit continues, the impact on UK business is starting to bite.

Industry’s strategy of abstention and neutrality has materialised into a freeze on spending and hiring, and economists warn of an increasing risk of recession. The government has warned that leaving the European Union without a deal could lead to delays at ports, food price hikes and disruption to medical supplies.

Any deal that might be successfully negotiated with the EU and approved by Parliament is likely to cause significant economic harm to UK industry, not least because it would put the country in a far worse relationship with its largest trading partner.

As public confidence in politicians sinks ever lower, surely it is time for business in the UK to show its hand.

In the UK, most executives still baulk at the idea of entering the political fray, unlike in the US where leaders in all sectors of business actively engage in controversial political and social debates.  In fact, with a shift in workplace demographics, consumers and employees increasingly expect their workplace to show where they stand.

The Edelman Trust Barometer, a poll of 33,000 individuals across 28 markets around the world, showed 64 percent think CEOs should take the lead on change rather than waiting for their government to impose it, and 79 percent want CEOs to be visible in sharing the company’s purpose and vision.

We have seen Marc Benioff use Salesforce’s success as a platform to speak out against North Carolina’s repressive transgender “bathroom law” and against the Indiana government’s “religious freedom legislation” which discriminates against the LGBT community. Walt Disney Co., Netflix, and other corporations have considered possibly exiting Georgia if the state’s “heartbeat” bill goes into effect, while Tim Cook, CEO of Apple, has been vocal on the environment and LGBTQI+ rights.

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INSEAD Knowledge is the expert opinion and management insights portal of INSEAD, The Business School for the World. Knowledge showcases the latest business thinking and views from award-winning faculty and global contributors

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Companies

Being a small company is a big plus when you’re at ZIM

the ZIM of today is a highly attractive employer, much closer in nature to leading high-tech companies such as Google or Microsoft, than its shipping peers.

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Over the last 3 years, ZIM, one of the world’s 11 most profitable shipping companies, has set itself apart from the old-school shipping industry, complex processes, outmoded technology and sluggish response to changes.

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Business

Thailand Approves Latest Economic Relief Package for Businesses

Some 250 billion baht (US$8 billion) was allocated for soft loans while the remaining 100 billion baht (US$3.2 billion) will go towards an ‘asset warehousing’ program whereby debtors can use their assets as loan collateral but will have the right to redeem their assets under a specific time frame.

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On March 23, 2021, Thailand’s government approved its latest economic relief package, valued at 350 billion baht (US$11.2 billion), to support businesses in the country.

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Asia-Pacific sees 3.9% growth in deal activity in February 2021

Boris Sullivan

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Chair’s Statement on the Informal ASEAN Ministerial Meeting (IAMM)

The Asia-Pacific (APAC) region saw a 3.9% month-on-month growth in deal activity (mergers & acquisitions, private equity and venture financing deals) from 1,126 deals to 1,170 deals in February 2021, according to GlobalData, a leading data and analytics company.

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