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Should businesses consult shareholders before taking a stand on social issues?

  • Written by Amanda Spry, Lecturer of Marketing, RMIT University

In 2017 many businesses took a stand on the Australian marriage equality plebiscite. We saw a comparable trend in recent months, as corporate Australia declared its position[1] on the Indigenous Voice to Parliament.

This included everyone from the Big Four banks to Wesfarmers, Telstra and Rio Tinto. It was not only most of the ASX top 20[2] declaring their support but also numerous small businesses[3]. Sectors as diverse as retail, publishing and education were represented.

Such public commitment is part of a wider movement towards “brand activism[4]” through which companies take on issues by publicly supporting or opposing a product or cause.

Well-known examples include Nike’s[5] anti-racism ad campaign spotlighting Black NFL player Colin Kaepernick and Bud Light’s[6] promotional partnership with trans influencer Dylan Mulvaney.

Brands can adopt a progressive or conservative stance in their activist messaging. But, brand activism is most commonly called upon to challenge a problematic status quo. Indeed, organisations[7] overwhelmingly backed a “Yes” vote for the Voice referendum, to improve critical outcomes for Indigenous people.

This raises questions about the role of business in society and the tensions between commercial and moral imperatives.

Two men standing and talking with a plane in the background.
Former Qantas chief executive Alan Joyce with Indigenous leader Noel Pearson at the unveiling of the airline’s campaign to support the Yes vote at this year’s referendum. Dean Lewins/AAP[8]

Should businesses be accountable to shareholders when deciding to take a public stance on social justice issues? Is it their role to take a stand on social justice issues and will doing so win or lose them support? What are the implications of making businesses “moral leaders” in the current climate?

Shareholders might be right to resist corporate activism

To date, the view businesses exist to maximise shareholder value has prevailed. The corollary is managers are answerable to shareholders[9] and all marketing decisions should protect their interests and augment profits.

A survey by the Australian Shareholders’ Association found 70% of shareholders[10] believed companies should not be funding the “Yes” campaign. Academic research validates shareholder concerns. Corporate activism provokes a negative reaction[11] from investors. It funnels company time, resources and attention away from revenue-generating activities.

In reality, shareholders are not involved in implementating a brand activism strategy. This would most commonly originate from the executive team and the company’s board would play an advisory role. Despite boards being able to make these decisions without referring to shareholders, they are still expected to act in shareholders’ best interests.

Furthermore, in taking a stand on a sociopolitical issue, company boards could and should anticipate shareholder outrage.

Two political billboards outside a polling booth.
A survey found 70% of shareholders were opposed to companies funding the Yes campaign. AAP[12]

While the tension between profit maximisation and social responsibility has existed for decades, this is intensified when the focal issue has a partisan quality. The risks are greater and outcomes, uncertain[13]. This was the case with The Voice.

On the matter of supporting charitable versus political causes, the Australian Shareholders’ Association stated[14]:

[…] broad agreement for companies supporting charities that align with their purpose, strategy, and objectives, but strong opposition to throwing weight behind any political causes.

In justifying their silence or neutrality on The Voice referendum, some companies including Orica and EnergyAustralia said it was not their place [15] to tell customers or employees how to vote. To the contrary, the contemporary academic view of business holds that brands have the potential to not only reflect but also influence market and societal values[16].

Businesses answer to many more stakeholders than shareholders

Social responsibility is no longer only the remit of not-for-profits and social enterprises.

Businesses today are accountable not only to shareholders but also a broader network of stakeholders. This includes customers, employees, investors, suppliers, governments, communities and more. Even the environment is a stakeholder.

When corporations orient themselves towards the interests of this diverse set of stakeholders, they must balance shareholder value with social responsibility. Recent research on “transformative branding[17]” has highlighted the potential for brands to pursue a hybrid of business and societal goals. Brands that do this with purpose can make real change in the marketplace.

Read more: Qantas throws weight behind Voice with travel for 'yes' campaigners[18]

Because activism ties a brand to a partisan issue, it also divides public opinion[19]. Empowering Indigenous Australians is, shamefully, still a contested issue in this country. Taking a stand on social justice issues raises the stakes on the low-risk initiatives companies[20] companies have traditionally favoured.

When brands seek out polarised spaces with their activist campaigns, they must anticipate backlash and carefully consider how to parlay this to advance the cause.

Authentic brand activism is important for business and social outcomes

Most integral is that businesses back their position[21]. Many companies declared they backed a “Yes” vote in the Indigenous Voice referendum. But to seriously affect social issues, brands need to do more than correctly read the zeitgeist.

Qantas[22] has historically supported Indigenous reconciliation. In 2014, Qantas put the “Recognise” logo on its aircraft and in 2019, the company pledged support for the Uluru statement. Yet, when Qantas joined the “Yes” campaign, they should have predicted the scepticism.

The airline[23] was in the news this year for posting record profits but refusing to pay back the government bailout received during the pandemic. There are ongoing allegations poor treatment of employees and bad customer service. Consumer sentiment towards Qantas reached an all time low.

Read more: Grattan on Friday: Same-sex marriage ballot captures attention of a public alienated from politicians[24]

By comparison, NRMA Insurance meaningfully buttressed a “Yes” message with their corporate actions. They announced a landmark partnership with National Indigenous Television[25], a channel owned by SBS. The funding was the largest investment by a single brand in the station and amounted to 3% of NRMA’s broadcast media spend for the year.

It’s time business was held to account

While many businesses backed a “Yes” vote in the Indigenous Voice to Parliament referendum, public opinion wasn’t swayed. The Voice was rejected by a majority in every state.

In the weeks, months and years after this disheartening outcome, we must hold businesses to account. Not just to their shareholders but to all their stakeholders. Did these brands just want to be at culture’s cutting edge or can they now demonstrate the intelligence to continue to advocate for social justice?


  1. ^ corporate Australia declared its position (
  2. ^ the ASX top 20 (
  3. ^ numerous small businesses (
  4. ^ brand activism (
  5. ^ Nike’s (
  6. ^ Bud Light’s (
  7. ^ organisations (
  8. ^ Dean Lewins/AAP (
  9. ^ shareholders (
  10. ^ 70% of shareholders (
  11. ^ negative reaction (
  12. ^ AAP (
  13. ^ outcomes, uncertain (
  14. ^ stated (
  15. ^ not their place (
  16. ^ influence market and societal values (
  17. ^ transformative branding (
  18. ^ Qantas throws weight behind Voice with travel for 'yes' campaigners (
  19. ^ divides public opinion (
  20. ^ the low-risk initiatives companies (
  21. ^ businesses back their position (
  22. ^ Qantas (
  23. ^ airline (
  24. ^ Grattan on Friday: Same-sex marriage ballot captures attention of a public alienated from politicians (
  25. ^ National Indigenous Television (

Authors: Amanda Spry, Lecturer of Marketing, RMIT University

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