Why Are Companies Like Chick-fil-A and Amazon Taking Stands on Controversial Social Issues?

For years, opponents of corporate 'socially-responsible' investments have claimed that such initiatives were a misuse of assets. But maybe they were wrong.

There has been public outrage - and chest-thumping support - regarding Chick fil-A, a large fast food chain, whose owner, a devout Christian whose stores are closed on Sundays, expressed his opposition to gay marriage. On the other side of the battle, the founder of Amazon, the world's largest web retailer, made the largest financial contribution ever to a gay-related cause.

Why would they bother getting so publicly involved in this issue and embroiling their businesses in controversies that ostensibly have little to do with what they sell?

The answer may lie in the evolution of post-industrial business and the marketing thereof. Historically, price has been the primary driver of consumer purchase decisions. But starting in the 1970s, when in wealthy North American and European societies most of Maslow's hierarchy of basic human needs were being comfortably met for the majority of the populace, attitudes about what mattered to the consumer began to undergo a shift. This meant that merchants had to find other ways of connecting with their customers.

Research began to demonstrate that values mattered to consumers. The brand - and the product it represented - were emblematic of the purchaser's status, convictions and self-image. Jeans and shoes and kitchen ranges and pasta and cars and now, even shopping bags, became a statement. Tattooing brands on one's arms or back, once unthinkable, became unremarkable.

So businesses began to embrace causes to show that they were at one with their public. They tried to make these as inoffensive to as many as possible: who could criticize you for being against litter, or child safety?

But as the global economy became more competitive and consumers' middle class lifestyles became less tenable, an edge crept into the debate. To break through the clutter, taking stronger stands on more divisive issues became necessary. At the same time, income inequality cushioned many wealth business people from the potential backlash associated with political stands. They were already billionaires, so who cares what a few thousand - or even tens of thousands - people think?

The active involvement of these billionaires in the political process has further fueled this trend. They think themselves to be financially insulated from the consequences of their stands and believe, perhaps accurately, that the political benefits far outweigh the commercial costs.

There are cycles in both politics and economics. The divisiveness evident today echos that of the mid-19th century and the early 20th century. It may fade as other issues become preeminent. But for the moment, business leaders believe that having the courage to take these stands is an expression of their status in society, will have few negative consequences - may even bind them closer to their core customers. JL

Kayla Webley reports in Time:

Billionaire Amazon founder Jeff Bezos and his wife MacKenzie pledged $2.5 million to help pass a referendum on same-sex marriage in Washington State. With the donation, the Bezoses became the largest public financial backers of gay rights in the country — and the liberal answer to Chick-fil-A president Dan Cathy, who made waves when he affirmed his company’s opposition to gay marriage.

But in terms of what they sell, neither Amazon nor Chick-fil-A has anything to do with gay marriage, so why did Bezos and Cathy each enter the political arena by making a statement on a divisive social issue?
For Cathy, it was a matter of staying true to his family-owned company’s firmly held, long-standing Christian beliefs. Chick-fil-A’s religious ties have always been public information. Not only are Chick-fil-A locations closed on Sunday, but over the years, the company’s charitable arm, called the WinShape Foundation, has given millions of dollars to groups that support its stance on marriage, including the Marriage & Family Foundation, Exodus International and the Family Research Council. But Cathy made his company’s position even more clear on July 16, when he told the Baptist Press that if people were concerned with the company’s views on the traditional family, then Chick-fil-A was “guilty as charged.” He continued, “We are very much supportive of the family — the Biblical definition of the family unit. … We know that it might not be popular with everyone, but thank the Lord, we live in a country where we can share our values and operate on biblical principals.”

Although Bezos and Cathy have different opinions on gay marriage, the motivation for disclosing their beliefs may have been similar. With his donation to the supporters of Referendum 74 — which would uphold the legislature’s decision to legalize same-sex marriage in Washington State — Bezos is essentially reaffirming his commitment to an issue he has publicly supported in the past. Though Amazon has not been as overt in its support of gay rights as Chick-fil-A has been in its opposition, earlier this year, when the Washington State legislature was prepping the same-sex marriage legislation, Amazon added its name to the list of companies that support the measure, which includes Starbucks, Microsoft and Nike, among others.

According to the New York Times, Bezos was prompted to make the donation by a former employee, Jennifer Cast, a lesbian mother of four children. Cast reportedly sent an e-mail to Bezos detailing why the referendum was so important to her and urging his support. “Jeff, I suspect you support marriage equality. I beg you not to sit on the sidelines and hope the vote goes our way. Help us make it so,” she wrote. Two days later, Bezos replied, “Jen, this is right for so many reasons. We’re in for $2.5 million.”

So far the outcry against the Bezoses’ donation has been virtually nonexistent, which might in part be because public support of gay marriage is at an all-time high. According to a Washington Post–ABC News poll in May, 53% of Americans say gay marriage should be legal, while 39% say gay marriage should be illegal. But that’s not to say companies haven’t faced outrage for making pro-gay statements. In February, the American Family Association, a conservative Christian nonprofit that opposes same-sex marriage, organized a campaign through its One Million Moms group to protest J.C. Penney’s hiring of openly gay talk-show host Ellen DeGeneres as its spokeswoman. In response to the campaign, J.C. Penney not only stood behind DeGeneres but ran ads featuring same-sex parents a few months later, and One Million Moms eventually abandoned its battle cry.

Similarly, when General Mills, which is based in Minnesota, announced in June that it opposed a proposed amendment that would ban gay marriage in the state, many supporters cheered the statement, but members of a group called Minnesota for Marriage staged a small protest outside the company’s headquarters and encouraged sympathizers to drop off unopened boxes of General Mills cereals outside the corporation’s offices.

Even seemingly innocuous gestures have led to full-on debates. In June, Oreo posted a photo of a cookie with rainbow-colored filling on its Facebook page in recognition of LGBT Pride Month. While the company says the majority of the 50,000-plus comments the post received were positive, some commenters said they would stop buying Oreos because of the photo. One comment read, “Think about how much business u just killed oreo. I can’t support a business that supports gays.”

Some companies have found themselves at the other end of the spectrum. In 2010, Target donated $150,000 to a political group that supported Minnesota gubernatorial candidate Tom Emmer, who opposed gay marriage. Public outrage over the donation spread far beyond the confines of Minnesota, where Target is headquartered, and prompted thousands nationwide to sign a petition to boycott the budget retailer. Target, which has said it made the donation to the group because of its pro-business stance, attempted to settle the outcry by making statements in support of the LGBT community. This May the retailer began selling gay-pride T-shirts, one of which reads, “Love Is Love,” and announced that all proceeds would go to the gay-rights group Family Equality Council.

As these examples demonstrate, regardless of a company’s position on gay marriage, voicing support or opposition is almost guaranteed to spur some sort of public reaction. But sometimes even representatives of companies that prefer to stay out of the political arena feel so passionately about an issue that they throw their opinion into the public sphere. Take Google, for instance. While the company has long been politically active on policy issues that involve technology and information access, it was mostly quiet on social issues until 2008, when co-founder and then president Sergey Brin came out in a blog post against California’s Proposition 8, which stipulated that only marriages between a man and woman would be recognized in the state:

“Because our company has a great diversity of people and opinions … we do not generally take a position on issues outside of our field, especially not social issues. So when Proposition 8 appeared on the California ballot, it was an unlikely question for Google to take an official company position on. However, while there are many objections to this proposition … it is the chilling and discriminatory effect of the proposition on many of our employees that brings Google to publicly oppose Proposition 8. While we respect the strongly held beliefs that people have on both sides of this argument, we see this fundamentally as an issue of equality.”

If Google’s profits are any indication, the search-engine giant is doing just fine despite its political stance. But even if he were concerned about losing some users, Brin might have made the politicized statement anyway. It seems that some company heads feel so strongly about their beliefs that they are willing to risk the consequences. To make a statement that in effect says, If you disagree with me, don’t buy my chicken, Chick-fil-A’s Cathy must have felt confident enough in his brand and conservative Southern roots to risk alienating some of his clientele (though it’s worth noting there’s no evidence to suggest Chick-fil-A discriminates against gay and lesbian customers or employees).

And while the backlash against Chick-fil-A has been fierce — gay-rights groups called for a boycott, and the mayors of Boston and Chicago issued statements urging Chick-fil-A to stay out of their cities — it’s too soon to tell if Cathy’s remarks will translate to less chicken being sold. Regardless, the company has said that in the future, “our intent is to leave the policy debate over same-sex marriage to the government and political arena.” Now that it has entered the arena, however, it might not be so easy to leave.