How to Stop the Corporate Virtue-Signaling Before It’s Too Late

Just before Halloween, the U.S. streaming giant Hulu sent out a tweet: “If you’re dressing up for #Huluween this year, this is your reminder to wear a costume that is culturally appropriate and respectful to others. Let’s celebrate the holiday in a way that we can all enjoy.”

The question of whether some Halloween costumes are “appropriate” is one of the hottest flashpoints in the culture wars right now. The mainstream media, university professors and left-wing politicians seem to agree that dressing up as people of another race is inherently offensive while a large proportion of regular people believe that costumes are only offensive if there’s an intent to mock. Unsurprisingly, Hulu’s finger-wagging tweet pissed off a lot of people who wondered why a streaming service was suddenly sounding like a social justice warrior. Hulu deleted the tweet.

Days later, another company was getting political online. Ben & Jerry’s launched a new ice cream called “Pecan Resist” featuring an angry looking dark-skinned woman on the container. The company claimed that buying the ice cream was a way to “peacefully resist the Trump administration’s regressive and discriminatory policies and build a future that values inclusivity, equality, and justice for people of color, women, the LGBTQ community, refugees, and immigrants.” Lefties—likely unaware that Ben & Jerry parent company Unilever sells skin-bleaching creams in India—seemed to love the product pandering to their causes.

Professor Jordan Peterson has recently called this kind of corporate virtue-signaling an “appalling sleight of hand” from executives making “300 times the average worker.” But it’s not only insincere, it’s also dangerous. There are enough forces fueling the political polarization in the west—from Black Lives Matter to Fox News to Vladimir Putin. The last thing we need right now is for corporations to be adding fuel to the fire by taking sides in the culture wars.

The dangers of this kind of corporate politicization became apparent in Australia last year after the government announced a plebiscite on the question of gay marriage. While a healthy debate took place in the political realm, many of the country’s biggest corporations, including Qantas, began to actively campaign for the “yes” side. Qantas CEO Alan Joyce, who is openly gay, was one of the most outspoken. He ended up getting a pie in his face.

Peter Dutton, whose Liberal National Party was opposed to same-sex marriage, argued that corporations should “stick to their knitting.” Dutton said that Qantas executives were welcome to campaign on their own dimes but he urged them not to “use an iconic brand and the might of a multi-billion dollar business on issues best left to the judgment of issues and elected decision-makers.”

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Sydney’s Catholic Archbishop, Anthony Fisher, was also concerned, warning that corporations getting political on social issues was threatening to democracy. “In our polity, corporations enjoy various privileges such as legal personality and perpetuity, limitation of liability, corporate tax rates, protections of intellectual property and bankruptcy law et cetera, on the understanding that they will use those advantages for their well-understood commercial purposes, and not so as to become a Fifth Estate governing our democracy,” Fisher said.

In the end, the “yes” side won a decisive victory, with 62.6 percent in favor and 38.4 percent opposed. Australia likely would have voted in favor of same-sex marriage even if corporations like Qantas had stayed out of it, but we’ll never know for sure. What we do know is that Qantas made large numbers of dissenters feel they were under attack.

Jeremy Sammut, a researcher at Australia’s Centre for Independent Studies, documented the corporate intrusion into politics in his recent paper, “Curbing Corporate Social Responsibility: Preserving pluralism – and preventing politicisation – in Australian business.”

Sammut points out that the corporate virtue-signaling almost exclusively tends to favor the political tastes of the “elites” over the “ordinary” people, and that’s what makes it so dangerous. When Hulu tweets about being “culturally appropriate” at Halloween, it’s affirming values primarily held by rich urban-dwellers in California and New York, while attacking the values of white rural voters who overwhelming elected U.S. President Donald Trump or voted for Brexit.

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As Harvard professor Amy Chua points out in her recent book Political Tribes, “when groups feel threatened, they retreat into tribalism. They close ranks and become more insular, more defensive, more punitive, more us-versus-them.” It’s easy to feel threatened when even corporations are piling on with the politicians. For another example of this, check out the videos of Americans burning their sneakers after Nike lionized NFL player Colin Kaepernick for refusing to stand for the national anthem before games. The Kaepernick controversy has been a gift to Donald Trump, who uses it to rile up voters.

Thankfully, there is a way to keep corporations in check, which Sammut calls the Community Pluralism Principle. He suggests that company managers be forced by their shareholders to adopt a statement along the following lines:

It is important for modern corporations to consider their impact on all genuine stakeholders in the best interests of shareholders. It is also important that engagement on social issues cannot be perceived to distract from company’s core business mission, duties, and accountabilities, nor negatively affect its brand and reputation in the market of opinion in a political sense. It is a matter for boards of directors and other corporate decision-makers to manage these risks by ensuring that companies respect and reflect the pluralism of Australian society and remain open to the views and values of all employees, customers, shareholders and stakeholders across the community.

If that’s too wordy, corporate leaders might simply quote economist Milton Friedman instead. “The social responsibility of business,” he once said, “is to increase its profits.”