Special Report

The Left’s Next Culture War: Corporate Virtue Signaling and Expanding Stakeholders

The Left’s Next Culture War (full series)

 Remaking the American Corporation One Board Room at a Time | Using Corporate Rating Indexes | Corporate Virtue Signaling and Expanding Stakeholders | How the Free Enterprise Project is Fighting Back


Summary: The political Left has had increasing success over the last decade compelling corporate America to actively support liberal positions on political, economic and social issues. Going under the saccharine heading “Corporate Social Responsibility,” this leftist campaign has succeeded in getting more of their own hired as CEOs, on the boards of directors, and in the C Suite. In recent years the campaign has persuaded many large companies to dissociate themselves from the National Rifle Association and to cheerlead for the LGBTQ agenda.

Justin Danhof is director of the Free Enterprise Project at the National Center for Public Policy Research. He has waged a lonely battle against the creeping leftism in corporate America. He recently sat down with David Hogberg, a former senior research associate at the Capital Research Center, for an interview.


Hogberg: How has corporate activism impacted gun rights?

A large, coordinated campaign of activists have been trying to change the culture on gun issues without changing laws. They’ve been using corporate America to do that and recently they’ve been wildly successful. They do this by filing shareholder resolutions and attending shareholder meetings. They also run various media campaigns. One that comes to mind was following the school shootings in Parkland. Right after that shooting, we saw “#BoycottNRA” on various social media platforms, so much so that it seemed that the Left had that in the hopper ready to go—that they were just waiting for the next school shooting. As a result of that pressure, at least 17 major corporations either took action against the NRA, such Delta Airlines which ended a special deal it had with the NRA and its members, or took action against guns, such as DICK’S Sporting Goods which actually removed guns from the shelves. When I confronted the CEO of DICK’s Sporting Goods at a shareholder meeting and told him that this would cause his company to lose money and offend a large portion of his customer base, he replied that he didn’t care. He said that DICK’S was standing up for a social cause and that he didn’t care if it harmed the bottom line.

Here’s another example. This year Levi’s has teamed up with former New York City Mayor Michael Bloomberg, giving his anti-gun group a six-figure donation. I confronted Levi’s about this, showing them some polling data that this move might cause them serious financial harm. Again the reaction was, “We don’t care, we’re taking a social stance that we believe in.”

Bank of America has said that it will no longer lend money to certain gun manufacturers that make “assault-style rifles.” A New York Times financial columnist, Andrew Ross Sorkin, has been pressuring Walmart on gun issues for years. And just recently Walmart has decided to limit its gun and ammunition sales as well. So, if you can squeeze guns out of the retail space, if you can limit the ability of gun manufacturers to get funding from banks, then you can effectively change the 2nd Amendment without any legislation whatsoever.

You don’t need to change the law to change the culture. If you can squeeze guns out of retail stores through pressure campaigns; if you can get credit card processors to stop processing payments; if you can get a company to be a watchdog for the government; if you can get banks to stop lending to gun manufacturers so that they can’t get funding to build their products, then you don’t need legislation. The Left is trying to achieve through corporate America what they cannot achieve legislatively.

Hogberg: How much of what corporations do on social and environmental issues is out of genuine commitment to the issue, and how much of it is virtue signaling?

First, let’s define virtue signaling. Virtue signaling is saying something to attract the “woke” crowd but not actually taking any action. Maybe five to seven years ago what corporations did along these lines was more about virtue signaling, just trying to appeal to the Millennial crowd. Well, what Bank of America, Walmart, and DICK’S Sporting Goods did regarding guns goes way beyond virtue signaling, obviously. Where corporations are taking a stand and don’t mind losing money—I’d say that is becoming more and more common.

There has been a shift where almost 100 percent of the time corporations are taking positions on these social issues that are liberal positions. I’d say that we’ve seen a substantial shift among companies taking tangible action that can hurt their bottom lines related to social issues in the last five years.

Hogberg: How about Apple’s CEO Tim Cook?

 I call someone like Tim Cook a Social Justice Warrior CEO—and there are other like him, such as Jack Dorsey at Twitter, Jeff Bezos and Amazon and others. The way Cook is running Apple is equal parts businessman and equal parts Social Justice Warrior. For example, Apple has given significant amounts of money to the Southern Poverty Law Center. When I confronted them on this, they were proud of it. Of course, the Southern Poverty Law Center has now come under fire for being a racist and sexist organization and for having millions of dollars offshore.

Now on environmental issues, I think Tom Cook and Apple are still doing some virtue signaling. They push recycling, for example, but so many of their products are not recyclable in any true sense of the word. So, on social issues, I think Cook is all in, but on environmental issues, it’s what I like to call “greenwashing.”

 Hogberg: You have a history with Tim Cook, correct?

Yes. It was at an Apple shareholder meeting where I raised my hand and asked Apple to only engage in initiatives that had a reasonable return on investment or at least some potential to have a return on investment. There were clearly some environmental initiatives that Apple was engaging in that clearly were not benefiting investors. I pointed that out, and then asked Tim Cook if he would make a commitment to only engage in projects with at least potential for a return on investment. I’d asked this at other shareholder meetings, and other CEOs had agreed to it. Well, Tim Cook exploded at me and said that if I cared about return on investment then I should sell my Apple stock. He then went on a longer tangent about how Apple was here to save the world and that people like me were getting in the way. His response received national and international media coverage, and the last time I checked it is in 12 college and MBA textbooks as an example of how not to engage with the shareholders.

Hogberg: Back in August the Business Roundtable adopted a new mission statement declaring that all corporate stakeholders are equal. I’d like you to discuss the implications of that, but first, what is the Business Roundtable and second, what is a corporate stakeholder? Aren’t they just the same as the stockholders?

 The Business Roundtable is a membership association of the CEOs of the largest companies in the United States. They are similar to the Chamber of Commerce in that they are generally for less regulation and a pro-business environment in the U.S. They lobby, they push initiatives, they work with Congress and the Executive Branch and so on.

Until the Business Roundtable finalized its new mission statement a few weeks ago, “stakeholder” was a word that you would only see come out of the mouth of leftists engaged in corporate activism. They’ve been using the term “stakeholder” for over a decade to get their voices heard and their foot in the door. Every liberal organization involved in Corporate Social Responsibility has decided that they are stakeholder for the longest time.

Now, what is a “stakeholder”? A stakeholder is any entity that is affected by a company in any way. So, for example, customers are often considered a stakeholder, and that might actually be an appropriate one. But the “environment” is also stakeholder. Protesters are stakeholders. In fact, anyone can claim to be a stakeholder.

Hogberg: So, let me interject here. Let’s say that I’m upset with Walmart for some reason. And let’s say, hypothetically, that I don’t own Walmart stock and I’ve never even shopped at a Walmart. But because I am upset at Walmart, I am now a stakeholder of Walmart?

Absolutely. Anybody who has a thought about a company can be a shareholder.

What makes the Business Roundtable statement important is that prior to that stakeholders was only ever a term used by liberal special interest groups. It signals a shift away from corporate legal responsibility to act in the best fiduciary interest of their investors, to company decision-making based on undefined stakeholders. For example, Nike can say it pulled the Betsy Ross Shoe, lost money for its investors, but its ok because they were looking out for certain stakeholders (i.e. the Colin Kaepernick crowd of cop-hating racists). Same with Bank of America pulling its gun lending business or canceling deals with private prisons. They may lose money, but they are looking out for the rabid anti-2nd Amendment folks and folks such as AOC who want to disband ICE. The examples are legion.

Hogberg: You said that we’ve seen a lot more left-wing CEOs in the last five to ten years. Why?

An attorney that I deal with at a company whose name I can’t reveal told me that the problem is not just the activists, it’s the search firms. The search firms employed by companies to find members of boards of directors have been taken over by “woke” capitalists in the last decade or so. The attorney said that when they have an opening on the board, the search firms usually send them a dozen far-left activists as candidates before they get even one person who you might call a centrist. Well, once a board of directors leans to the Left, who do you think that they will be looking for when it comes time to hire a new CEO?

This the problem that we face on the right: There is no conservative leaning search firm that recommends candidates for boards of directors. The conservative movement is not engaged in that arena at all.


In the conclusion of The Left’s Next Culture War, what the Free Enterprise Project is doing to fight back.

David Hogberg

David Hogberg, Ph.D., is a CRC alumnus and author of Medicare’s Victims: How the U.S. Government’s Largest Health Care Program Harms Patients and Impairs Physicians.
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