CEO ACTIVISM

SUBJECT:- COM501 Corporate Communication

Prepared By:- Karan Trivedi

Enroll No.:- AU1814018
Submitted to Faculty:- Sudhir Pandey
CEO activism is a event in which the business leader or executives starts taking public podium and share
their views on political or social issues that are not directly related to the company but the issues that are
affecting the society. This stance usually won’t increase the company’s profits. For example, in 2012,
Chick-fil-A CEO Dan Cathy denounced gay marriage on radio show. CEO’s have spoken much about the
climate change, income fairness, same sex-marriage, immigration, gun control and discrimination. CEO
activism influences the public’s opinion on social and political issues. When consumers agreed to CEO’s
stances, they usually buy products of that company more which was good for that company. All this made
critic thought that CEO activism gave businesses even more influence in a political system. But from
business perspective, it is quite risky to engage in such activities as it may also lead to negative impact and
criticism for the company and CEO if people don’t agree to voice raised on issues. One of the
responsibilities of a CEO is to determine the degree to which personal identification, and by extension the
organization’s identification, with social issues is appropriate. Of course, all major business organizations
participate in lobbying activities through an association or by other means. It is pretty much assumed. CEO
“activism”—taking a public stand or action for or against a social issue—is something else. For e.g. Apple
CEO Tim Cook, publicly expressed his views against Indiana’s Religious Freedom Restoration Act (RFRA).
He argued that the law legalized discrimination in a way following businesses to refuse to serve lesbian, gay,
bisexual and transgender Customers. Some conservative websites criticized Marc Benioff and Tim Cook for
denouncing religious freedom laws while their companies continued to do business in china. China did not
have strong record of protecting LGBTQ rights.
CEO who chose to engage in social and political issues did so in a variety of different ways and that led to a
wide range of results. In some case CEO activism was perceived as opportunistic rather than authentic. In
April 2015, when chipotle announced that all its ingredients would be GMO-free, CEO Steve Ells said that
chipotle is showing that there’s a better way to do fast food and “they” say that these ingredients are safe,
but we all know food is safer if those ingredients are not there at all. Here by the Ells pointed to all those
who said GMO’s are not harmful. Critics contended that Chipotle’s strategy and Ell’s rhetoric were
polluting public discourse on scientific matters. All this was to gain popularity with millennials and health
conscious customers.

Indian CEO do not speak much in open about this kind of issues because of the fear of criticism and the
risks which are associated with the issues. People hold the view that CEO activism is quite dangerous and
there is lack of any analytical foundation for engaging in any such activity. There are number of
stakeholders which are associated with the company such as customers, employees, government, suppliers
etc. and so Indian CEO are afraid that if something wrong happens all of them will be in trouble. Also, it
requires analysing the economic consequences of any particular action, something which is hard to do in
advance of an action. They don’t want to go against the public morality. Some CEO feel that CEO activism
is a serious threat to the financial success. Often CEO activism is confused with CSR activity in India. But
CSR involves social activity and is related to the social issues and they are essentially not related to the
specific businesses. So, in India CEO activism is comparatively lesser then in other country to some extent.

A CEO’s activism depends on how strongly and uniformly a CEO, their board and senior executives in the
organization, feel about any issue. Increasingly, CEOs have realized that they have an opportunity and an
obligation to speak out, for the sake of their businesses. According to survey conducted by KRC (Kappa
Recognition Factor) research 82% of Tech professionals are having a favourable opinion on CEO activism.
They believe that CEOs can influence decisions of public by speaking out against certain issues or evils.

Indian CEO can currently speak on topics like Section 377, Sabarimala Temple, Swatch Bharat Abhiyan,
#MeToo, Ayushman Bharat Scheme, Patanjali etc. According to KRC research the topics which currently
need focus by the CEO as well as public or society are issues related to job and skills training, equal pay,
healthcare coverage, maternity or paternity leave, Privacy and personal data protection, LGBT rights,
Gender equality, Women empowerment, Climate change, Globalization, Sexual harassment, Artificial
intelligence etc.  Proper involvement of CEO for certain issues can lead to betterment of society. The
concept of CEO activism is slowly gaining popularity and it has the potential to emerge as one of the
important aspects if done rightly.