Increasingly, corporations are finding themselves called upon to become—willingly or unwillingly—participants in a range of social and political controversies. While retail businesses long have been accustomed to consumer-driven activism such as boycotts and publicity campaigns, the current movement is significantly different. Today, institutional investors and other stakeholders are asking companies to take public stances on a wide array of topics, some of which may be wholly unrelated to the targeted company’s corporate purpose. Investment funds themselves are feeling this pressure, as they are being asked by their own investors to become activists on social issues, and the rapid pace of recent external events—combined with the impact of social media—can demand hasty statements or actions.

In response, corporations need to proceed thoughtfully, deliberately, and with caution. While corporate policymaking and public statements on social and political issues are essentially management decisions, the board should be kept informed and has the right to weigh in, if it so chooses. At the same time, the need to respond quickly often necessitates that management take the lead. Ideally, the board should be comfortable with management’s message, plan of action, and evaluation of the attendant risks.

This content has been archived. It is available through our partners, LexisNexis® and Bloomberg Law.

To view this content, please continue to their sites.

Not a Lexis Subscriber?
Subscribe Now

Not a Bloomberg Law Subscriber?
Subscribe Now

Why am I seeing this?

LexisNexis® and Bloomberg Law are third party online distributors of the broad collection of current and archived versions of ALM's legal news publications. LexisNexis® and Bloomberg Law customers are able to access and use ALM's content, including content from the National Law Journal, The American Lawyer, Legaltech News, The New York Law Journal, and Corporate Counsel, as well as other sources of legal information.

For questions call 1-877-256-2472 or contact us at [email protected]