(Illustration by Adam McCauley)
In 2000, the Italian clothier Benetton conducted an advertising campaign called “We, On Death Row.” As part of the campaign, the company sponsored the publication of a booklet in Talk magazine that featured interviews with 26 death row inmates in the United States. Victims’ rights groups such as Justice For All and the National Organization of Parents of Murdered Children mounted protests against what they perceived as a sympathetic portrayal of 26 murderers. These groups also formed an alliance with the department store chain Sears, which pulled all Benetton products from its shelves. For Sears, taking a stance on a contentious issue like the death penalty posed a risk. But company executives believed that a boycott of Benetton would align with most of their customers’ own stance on the issue.
Allying with activist organizations “is a tactic that companies have been using for years. It is just something that they haven’t typically done overtly,” says Mary-Hunter McDonnell, assistant professor of management at the Wharton School of the University of Pennsylvania. She cites research on covert corporate activism by Edward Walker, associate professor of sociology at UCLA. Walker acquired the client list of a large public relations firm that organizes covert activist campaigns, and he found that a significant portion of Fortune 500 companies were on that list. Increasingly, McDonnell says, companies are less quiet about engaging in such campaigns.
To study this overt form of corporate activism, McDonnell investigated instances in which companies participated in boycott campaigns by activist NGOs. Using the Factiva Major News and Press Release Wires database, she looked for boycotts that gained the support of selected Fortune 500 companies over the period from 1993 to 2007. During that 15-year span, she found, 43 companies in her sample participated in 74 such actions. McDonnell also tracked successful and unsuccessful “contentious challenges” against companies in the sample—that is, cases in which a company was the target of a boycott—and she studied each firm’s public reputation by conducting a content analysis of articles published about the firm in USA Today.
As it turns out, corporations that partner with NGOs in boycott campaigns are typically not known for being socially responsible. “These are not companies with the best reputations,” McDonnell says. On the contrary, they tend to be companies that have made concessions to activist groups in earlier contentious interactions. And, McDonnell argues, these companies choose to ally with such groups partly to gain protection against further contentious challenges.
For corporations, this tactic often works. “These partnerships are effective at reducing contentious interactions,” says McDonnell. According to her research, companies that participate in such a partnership in a given year experience a 56 percent reduction in the number of activist challenges during the following year. Interestingly, through interviews with leaders at companies that joined boycott campaigns, McDonnell discovered that over time they often develop a genuine interest in the issue that they choose to address. “What might have begun as a defensive move to protect a company’s reputation became an authentic effort to be at the vanguard of social activism,” says McDonnell.
NGOs, McDonnell suggests, derive important benefits from bringing corporations into their boycott campaigns. One NGO leader, she says, told her that his organization will sometimes reach out to the second-worst offender in an industry and say (in effect), “We’re about to launch a campaign, and either we’re going to target you, or we’re going to target the company worse than you. You don’t want to be the one that’s targeted, and we’d love to partner with you.” About this method, McDonnell says, “It’s a strong-arm strategy, but I think it works. You can have support from a high-status company in an industry that’s problematic.” She points to another reason why corporate support can be beneficial: A boycott tends to work best when an activist group can advise consumers to substitute a specific product for the product that they must give up.
Yet NGO leaders need to act wisely when they move to enter a corporate partnership. So argues Christopher Marquis, professor of management at the Johnson Graduate School of Management at Cornell University. “There is a lot of research that shows that NGOs can gain from closer ties with companies,” Marquis says. “As companies begin to see NGO relationships as strategic, [NGOs] can benefit from [a corporate partner’s] managerial and financial attention.” But allying with corporations can be problematic. “The danger is that [NGOs] become co-opted and are not able to fulfill their mission effectively,” Marquis observes. “Thus they must be careful to select the right partners.”
Mary-Hunter McDonnell, “Radical Repertoires: The Incidence and Impact of Corporate-Sponsored Social Activism,” Organization Science, 27, 2016.
Read more stories by Corey Binns.