We would like to think corporate America, particularly beloved companies, understand us as their customer/consumer and what and how we identify. When companies fall short of that expectation, particularly around social issues, reactions range from passive disappointment to much stronger calls to boycott affiliations in today’s modern cancel culture. Many also hold businesses to a higher standard than individuals, with the expectation that the conversations in the board room would lead to manifestations of our values through their products, services, and internal practices such as hiring, board composition, and vendor selection. And yet, time and time again, the news is filled with stories about companies falling short on social issues such as race and diversity, queer inclusion and representation, and the treatment, or rather mistreatment, of women.
Interestingly, our reactions tend to be much stronger when businesses fail us around social issues than when our political leaders do. This may be because people feel disenfranchised from the political process where they hold the perception that there is little they can do to influence outcomes, whereas purchasing choices are much smaller and more tangible. Although our political system is created such that the leaders are meant to represent us, many also feel that the shirt they choose to wear or coffee shop they choose to frequent is a more significant and intimate representation of who they are.
Similarly, when businesses fall short on non-social issues, such as product quality or integrity, we are much quicker to give them a pass. When companies falsely advertise the efficacy or value of a product, there are not the same calls to boycott the brand and disinvest from the company. Even though false advertising demonstrates questionable ethics and judgment from the company and product failures result in direct financial loss for the consumer, there does not tend to be a corresponding emotional reaction. Consumers generally do not associate these individual failures or missteps with larger identity or value misalignments according to research on customer loyalty.
It is important to note, however, that how a company or individual responds to any failure affects how we react. Performative public apologies do little to help, and can often demonstrate how inauthentic and shallow the response actually is. Instead, deeply engaging with the failure and those affected by it can demonstrate meaningful desire to learn, grow, and change. This can take many forms and may not always have a public component. Strong corporate apologies tend to have the following elements:
- They apologize. They don’t skirt the issue or redirect responsibility. They take ownership of the error and its consequences.
- They don’t point fingers. Regardless if there are other actors in the chain that contribute to the issue or a larger industry practice that supports it.
- They share their next steps to improve. Even when this is not a readily actionable step, conveying that the apology is not the only way the failure is being addressed is important.
- They start at the top with leadership. Whether that is sharing how executives are planning to learn more, for example, or by demonstrating tangible changes they have made to their leadership structure, the liability (ethical and moral in addition to legal and financial) falls and ends with executive leadership.
With each social movement, we see a wave of awareness, finger pointing, rush to apologize, and with some actors, efforts to make change with varying ‘stickiness’. While we hope that as the wave crashes and things quiet, the issues have been addressed, we have time and time again found the need to continually engage business around social change and can expect to see more corporate apologies in the future.
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