A few weeks ago, a Zomato user canceled his order because the delivery person was a ‘non-Hindu’ and made his complaint public by tweeting to the company’s official Twitter handle. What followed was a rare instance of an Indian organization taking a clear public stand on an issue fraught with controversy in today’s politically-charged times. Zomato stood its ground and stated that “food has no religion”1; Zomato’s CEO Deepinder Goyal went a step further to express pride in India’s diversity and added, “...we aren’t sorry to lose any business that comes in the way of our values.”2
The episode went viral and was widely covered by media platforms, eliciting a polarized response from the public. While on the one hand people lauded the restaurant aggregator for promoting inclusion and diversity, others sided with the complainant and responded by posting screenshots of uninstalling the app and giving it one-star ratings (a reminder to the 2015 incident involving Aamir Khan and Snapdeal). Let us take a closer look at the rise of social consciousness in the corporate world and the future of organizations as social enterprises.
When brands get vocal
India is considered a deeply-religious and largely-conservative nation, which explains the fact that why most organizations prefer not to take political sides or run advertisement campaigns with social commentary and continue to play it safe. However, corporate organizations taking a public stand on social, political or environmental issues has become a common practice in the US and Europe, particularly in the last few years. Many times, organizations design their marketing and promotion strategies based on deeply-contested social and political issues. However, how they handle the subject usually deciphers the reception they receive. So, on the one hand, Nike received a polarized reaction3 to onboarding Colin Kaepernick (who protested racial injustice in the US by kneeling during the national anthem) as their brand ambassador; on the other, the likes of Gillette4 and Pepsi5 got unanimous backlash for mishandling a sensitive and relevant issue.
Forty-four percent millennials feel increased loyalty toward their CEO if he/she takes a stand on a relevant contemporary issue, and 47 percent believed that their CEO should take active stances on social issues
There have also been several instances in the US where industry leaders have called out on the Trump administration’s discriminatory policies; last year more than 50 organizations, including Facebook, Google, Apple, and Amazon took a stand6 against the government’s attempt to limit the definition of gender by birth and in 2017 a similar group denounced7 the President’s ban on citizens of seven Middle Eastern and African nations from entering the US. Airbnb aired an ad as a direct response to the ban in the Superbowl championship that followed the week after the band was implemented. Last year Volkswagen and Siemens also forcefully denounced8 discrimination and xenophobia when violent protests that rocked Germany took a racist turn.
There have also been instances of organizations penalizing their employees for racist behavior and comments; last year Starbucks closed more than 8,0009 stores for several hours to train all their employees on unconscious bias when one of their baristas phoned the police to remove two men of color who hadn’t bought anything while they were waiting. Similarly, Disney-owned ABC canceled10 a popular revived show Roseanne after the show’s lead actor tweeted racist and derogatory remarks about President Obama’s advisor.
The impact and motivation of taking a stand
Call it what you want, but there is no denying the fact that these episodes create an impression and garner attention. While many may brush off these incidents as opportunities for publicity or carefully-crafted PR, the truth is that organizations all over the world are finding it tougher to demarcate business from the values that they stand for. While there is limited data that studies the impact of organizations taking a public stand on social issues on bottom-line or employer ranking, most experts11 believe that people respond better to brands that demonstrate corporate responsibility and go beyond offering just a product or service. Globally, while organizations might not be entirely comfortable stepping into this role, but their increasing influence of societal changes has necessitated them to clarify their positions on social or political issues to ensure that ‘belief-driven’ customers continue to identify with their brand.
The reaction elicited by a cleverly-worded tweet from Zomato shows the immense power and influence that publicly-recognized brands command
Apart from creating goodwill in existing customers and cementing brand loyalty, there is another dimension to big corporate names taking a public stand on divisive issues. In today’s competitive labor market, organizations are working hard to create a unique and attractive employer brand that resonates with millennials and Gen Z workers. Organizations realize that company values play a much higher role in millennial job choices today and understand the importance of cultivating loyalty as a brand and as an employer. A 2017 American survey12 found that 44 percent millennials feel increased loyalty toward their CEO if he/she takes a stand on a relevant contemporary issue and 47 percent believed that their CEO should take active stances on social issues. While this data cannot be directly applied to the Indian millennial demographic, one can consider the general trend in the Indian millennial workforce to be on similar lines. It all ties in neatly with the trend wherein organizations are increasingly viewing their employees as the first customer and catering to their needs and aspirations in a similar fashion. It is also worth noting that in most cases, digital and social platforms are smartly leveraged to garner positive publicity and ensure that the message reaches the intended audience.
Organizations as social influencers
The recently-published 2019 Deloitte Global Human Capital Trends13 report, which surveyed approximately 10,000 respondents from 119 countries, also noted that organizations need to reinvent themselves as ‘social enterprises’ with a human focus. The CEOs who participated in the study stated that the top measure for success is no longer just revenues or profit, but the “impact on society, including income inequality, diversity, and the environment.” It is important to note that leading a social enterprise should not be mistaken for practicing corporate social responsibility or running a social impact program, but recalibrating existing models of work to respond to pressing social and environmental challenges.
Given the fact that businesses have shaped consumption patterns and trends for decades, it is not entirely unimaginable for them to effectively influence societal norms and cultures as well. As we march into an unknown future, the vision, values and actions of enterprises will hold even greater significance for the world and how we work and live. However, for any discernible impact, organizations will have to go beyond lip-service. Experts14 suggest that businesses and leaders should take actions that support their public stance, and progressive business voices must promote inclusion and integration. Thus, the reaction elicited by a cleverly-worded tweet from Zomato shows the immense power and influence that publicly-recognized brands command. Going ahead, organizations will find it tougher to stay silent on contemporary social issues and might as well be forced to clarify their position in order to retain customer and employee trust. The increasing number of industry leaders breaking their silence will eventually encourage other medium and small players to follow suit and if not increase the role of businesses in shaping acceptable societal values, norms and cultures, at least initiate dialogue and debate regarding the same.