Some ESG issues have become hot spots for activism. The responsibility of companies to contribute to climate change is one of them. Another is to promote a more diverse corporate leadership and workforce, seen through the prism of the Black Lives Matter and #MeToo movements. Employee activists increasingly challenge their employers to reassess institutional biases and problematic relationships with suppliers.
And then there are political issues in the United States, especially following the 2020 presidential election and the January 6 attack on the U.S. Capitol. The list goes on.
“Millennials are becoming more and more powerful and now occupy higher positions. They genuinely care about the ethics and demonstrated values of their employer organizations, ”said Valerie Charles, partner at global consulting firm StoneTurn, during a panel discussion at the National Compliance Week conference. last month. “That doesn’t mean our generation doesn’t take ethics seriously, but it’s different. Younger people associate their personal identity more concretely with their workplace and the values of the organization. It is no longer enough to speak; you have to walk walking.
Megan Reitz, Professor of Leadership and Dialogue at Ashridge Executive Education at Hult International Business School, has been studying the culture of speech and employee activism for seven years. She argues that employee activism is not only here to stay, but will become a defining feature of the workplace.
“Millennials and Gen Z in particular have a more militant bent and will choose where to work based on the actions these organizations take,” said Reitz. “Refusing to engage with employees on current issues can make it more difficult for companies to attract the kind of talent you need or want. “
” The youngest [generation] more concretely associates their personal identity with their workplace and the values of the organization. It is no longer enough to speak; you have to walk walking.
Valerie Charles, Partner, StoneTurn
In addition, workplaces that are willing to engage with employees on a variety of issues, whether work-related or not, offer other benefits, she said.
“The questions around: ‘What do you represent?’ and “How do you make your choices about your impact on the world?” “Are really important to consider,” she said. If your business does not engage with employees on these issues, it raises red flags, including it could indicate that your business cannot manage and engage with different perspectives.
“And then you have a bigger problem than just understanding employee activism. You also have a problem of innovation and change, ”she said.
Tae Wan Kim, associate professor of business ethics at Carnegie Mellon University, studied how algorithms can produce biases in decision-making that are impossible for consumers to see and difficult for businesses to explain. He argues that companies have a moral duty to explain how algorithms make decisions that affect people.
Kim said she was approached by a large company who wanted to provide an explanation to their customers about targeted advertising. Their motivation was not return on investment or profit but rather to push the company in a more ethical direction. Kim said the company was driven by pressure from inside (employees) and outside (media and customers).
“They understood that, intrinsically, ethics are important. They were tired of being criticized by the media. The employees were fed up with feeling guilty about the status of the company, ”he said. Kim said companies considered to have high ethical standards, especially in the tech industry, have a head start when competing for top talent.
Determine the correct answer
The response of companies to employee activism has varied. The most common approach has been to try to remain non-political. Coinbase CEO Brian Anderson tried to keep politics out of the workplace in a controversial September 2020 blog post, in which he banned workplace discussions of “internal political causes or candidates. not related to work ”.
“I recognize that our approach is not for everyone and can be controversial. I know a lot of people may disagree and some employees may quit, ”he said. About 60 Coinbase employees did just that and quit a month later, according to Forbes.
Online furniture retailer Wayfair also tried to put its head in the sand in 2019 following a petition from employees asking the company to stop selling furniture to US detention centers that housed children of the United States. ‘immigrants. The resulting firestorm over a very small sale damaged the Wayfair brand and made it harder for the company to attract and retain the best employees, according to Forbes.
Employee activism also translated into union activity, as it did among Amazon warehouse workers in Alabama. But at least with labor movements, companies have benchmarks set by the rules of the National Labor Relations Council and legal precedents.
Many managers find themselves ill-equipped to deal with employee activism, Reitz said. It’s not like whistleblowing, where many companies have processes in place to report workplace safety issues or illegal behavior through hotlines, etc.
Top-down organizational structures of companies make it difficult, if not impossible, for the average employee to engage in workplace activism. And that’s by design, Reitz said.
“Power is also one of the things we talk about the least and least comfortable talking about. But if you want to disrupt the habits of speaking and listening, you have to talk about power,” he said. she said. “You have to talk about uncomfortable topics, like, ‘How do we label each other?’ and ‘What are the impacts of this?'”
Maybe your organization is one with “open door” policies. Anytime an employee wants to raise an issue, they can simply walk through a manager’s door and talk about it. But that doesn’t reflect reality, Reitz said.
Many employees are intimidated by those in power in their organization – an imbalanced relationship built to favor the manager and his or her views over those of the employee.
“Can we stop talking so much about how brave people have to be and start explaining why they have to be so brave in the first place? Reitz asked.
Tips for encouraging a culture of speaking
Not all organizations have to become a true advocate, like outdoor clothing retailer Patagonia or Ben & Jerry’s Homemade Holdings, Reitz said.
Instead, view activism as an opportunity to engage in meaningful discussions with your employees. Yes, there is a risk and the unknown is scary. But the perks of being seen as a company that values employee contributions – who take their concerns about the world around them seriously – may outweigh the cons, she said.
Here are some practical steps your organization can take to foster a workplace culture where speaking out is not only acceptable but encouraged:
- Burst the “bubble of optimism”. Reitz’s research indicates that the senior the manager, the more optimistic he becomes. The bubble of optimism makes it more difficult for this manager to understand the difficulties of younger employees. The manager overestimates their listening skills and accessibility, which affects the extent to which employees feel comfortable expressing themselves. Leaders often mistakenly label activism as rebellion or unnecessary disruption. Their seniority can mean they’re out of touch and need to make sure they’re engaging with different points of view and what matters to employees. Ghostboards and reverse mentoring – a concept with which Citi CCO Mary McNiff explained her experience at a conference at Compliance Week 2021 – are ways to start bridging the gap.
- To remain apolitical is a misnomer. Inaction is not neutral: it is also a political declaration and a stance. Saying nothing and hoping for a problem to go away could open an organization to even more criticism, Reitz said.
- Avoid quick fixes. It’s natural to want to fix the problem right away and move on. But tackling activism more often than not leads to an over-promising and under-deliverable business, Reitz said. A knee-jerk reaction to activism can create more problems, like a company saying one thing about its corporate environmental stance, but lobbying for its opposite behind the scenes.
Managing employee activism should be part of a company’s strategic plan, which would produce more thoughtful and actionable results. Tying executive compensation to ESG goals would be another way to turn words into action, Reitz said.