Demands for corporate activism on the rise as election season begins

From the desk of Mike Rusher, President of The Results Company 

Over the next six months, businesses around the state will face various pressures to engage in controversial political debates. But who is pushing this activity, and more importantly, why?
 
Eight years ago, as many of us can vividly remember, opponents of North Carolina’s “House Bill 2” mobilized many in the business community to great effect. National headlines screamed of employers leaving or boycotting the state week after week, month after month. Economic damages were celebrated. It likely resulted in Gov. Roy Cooper’s election which was won by just over 10,000 votes.
 
HB2 was an anomaly. In the years since, many special interest groups, and some bad actors have tried to run the same play time and again – threatening, opining for economic damage – for the purpose of political gain.
 
So today let’s take a look at some recent efforts to push the business community into corporate activism (a practice we’ve written extensively about).  Doomsday predictions of economic turmoil haven’t come true, which should give everybody pause the next time news outlets, or candidates suggest political debate will harm the state’s economy.
 
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Just this month, North Carolina media outlets sounded the alarm: Citing the perils of voting the wrong way in the upcoming governor’s race – “Connecticut aims to poach North Carolina companies,” WRAL’s political arm reported.
 
The political motivation of this tactic isn’t particularly concealed: Attorney General Josh Stein, who is running for governor, said last month, “You better believe that Robinson’s extreme views would scare away business and good paying jobs. We’ve been down this road before here,” a reference to House Bill 2. Regardless of one’s candidate preference, a threat is now on the table – vote this way, or else.
 
“We are asking you not to put the business community, the economy in North Carolina, [our] rating by CNBC as America’s top state business in 2022, at risk.” So pleaded Raleigh restaurateur Ashley Christensen – a prominent activist in Democratic Party circles – as the legislature considered a 12-week restriction on abortion last year.
 
Michael McElroy, a UNC journalism professor who writes for Cardinal and Pine (a Democratic Party-aligned dark money organization), advanced the same thinking last year: “Sure, for the second year in a row, CNBC ranked North Carolina the best state in the nation for business, based in large part on its workforce. But that award isn’t made of gold, [a group of] business leaders said (…), it’s made of glass—and that glass was already showing cracks.”
 
Dozens of other articles reprinted similar arguments spurred on by political publicity events, like the “roundtables” hosted by Raleigh brewery owner (and prominent Raleigh figure) David Meeker along with Democratic politicians.
 
“Some worry abortion restrictions could be ‘a real hurdle’ for NC’s economy,” read a representative headline from ABC 11.
 
“This is a repeat, in many respects, in what we went through with House Bill 2,” Scott Falmlen of Nexus Strategies – the most prominent Democratic consulting firm in the state – told reporters.
 
Regardless of one’s policy preference, a threat was put on the table – vote this way, or else. The playbook was obvious: Repeat ad nauseum that any new restrictions in North Carolina would harm the economy, just like House Bill 2 did. In doing so, Democratic operatives hoped to find themselves in a win-win. They would either apply enough pressure on Republican legislators to convince them to scrap abortion-related legislation, or they would mobilize enough blowback to impact the next election.
 
But neither of those things happened. The abortion legislation was passed, it generally aligns with where many western democracies have ended up on this issue, was aligned with nearly all available public polling (which we wrote about here), and resulted in a collective shoulder shrug.
 
A similar dynamic played out as the state Supreme Court considered the Leandro school funding case in 2022, a long-running quagmire that we’ve written about previously. Leaders in Democratic Party circles corralled a number of business owners to sign an amicus brief to the court alleging the justices must side with Democratic Gov. Roy Cooper or risk scuttling economic growth – Rule this way, or else.
 
The tactics employed to garner signatories created their own firestorm. The NC Chamber had to notify the court that their chair’s signature was put on the letter without permission. The move “seems calculated to create confusion for the Court, if not outright misrepresentation. The NC Chamber had expressly stated to those organizing [the letter] that the NC Chamber would not appear in the case,” wrote the Chamber’s General Counsel, Ray Starling.
 
During last year’s coverage of new laws limiting controversial gender therapies for minors, news stories often referenced the economic impacts of House Bill 2, suggesting similar fallout might be in the cards – Vote this way, or else.
 
Like policy action on abortion and education, though, economic damage never materialized on this issue, either. In fact, the Associated Press and Axios even covered the lack of backlash. WRAL took it a step further, contacting the companies that spoke out about HB2, but failed to take a stance on the recent legislation – then they published the long list of companies that had not signed onto a Human Rights Coalition petition against the legislature.
 
There are numerous other examples. The takeaway is the same: Activists and media threaten dire economic consequences over an issue they deem controversial.
 
There has been a shift in perspectives since 2016, however. Voters, consumers, and business leaders are tired of the corporate activism pushes. In fact, last year, polling showed that just 26% of North Carolina voters support businesses taking political stances. Another 57% oppose this action from businesses and 17% aren’t sure about it. We wrote about that too, explaining why leaders should be highly skeptical when faced with pressure like this. 

Businesses are up for the challenge of addressing societal problems within their core competencies, but the activism push to bully businesses into weighing in on complex political questions is now counter to prevailing public sentiment.
 
This shift has occurred, perhaps, because business leaders do not operate on two or four year cycles. The determinations made at a company level span decades and are often generational planning decisions. For business leaders, navigating this political minefield starts with having a firm understanding of the purpose of one’s business, and that comes from within.

If you think of someone that might like to read today’s column, please take a minute and forward it it them. Thank you for reading.