Politicisation of Corporate Organisations: Justified or Business Trend?

This essay explores the justification of the perception of Qantas CEO Alan Joyce regarding the need for corporate organisations to be vocal on social issues. It discusses the pros and cons of politicisation of operations and analyzes the perception of CEOs of other Australian companies. The essay also examines the impact of CEOs' opinions on consumer perception and brand loyalty. The role of CEOs in shaping public opinion and the ethical implications of politicisation are also discussed.

Running Head: MM322 BUSINESS ETHICS
MM322 Business Ethics
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Essay on topic 1
Introduction
The primary objective of this essay is to justify whether the perception of Qantas CEO Alan
Joyce regarding the need of Corporate organisations to be vocal on social issues is justified or
not. In this context, the pros and cons of politicisation of operations will be considered and
debated in this essay. Drawing examples from Ideal businesses and perception of CEOs of other
Australian companies regarding politicisation of corporations will also be considered for analysis
of the scheduled topic.
Discussion
In a study of the popular human capital Trends 2018, conducted by Deloitte it was observed that
the managerial heads of various organisations are in a quandary regarding their position on the
social issues. As reported by the CEO of Merck, he was confused regarding how to deal with the
Charlottesville issue and finally decided that it was best to speak out his position regarding each
after exiting the business leadership roundtable of Donald Trump. Many companies has shown
the interest to take their position among the public regarding considerable social issues.
However they have not been able to finally speak up on the issues out of the fear of losing
business. Again they are examples of big corporations like Walmart who set example for
corporate organisations by choosing to stay away from speaking in favour or against the social
issues. Walmart and Dick Sporting had decided not to speak up in public regarding the position
on guns.
However, in this context Ben Khaled and Gond (2019), is of the opinion that the consumer
perception regarding the CEO of the managers of the organisation has changed. The consumers

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are now not only satisfied by the product offerings of the organisation. They suppose that value
generation should also be an integral part of the business activities. Brand equity and brand
loyalty of the customers are developed define the business leaders of the organisation speaking
up in favour or against popular social issues. 56% of the consumers, as reported by Ciaglia
(2016), have absolutely no or negligible face for the organisations which remained silent
regarding the social issues. Find that the business entities are socially responsible entities and
therefore 64% consumers of Australia want that the big Corporation should stand up among the
public in order to speak out their position on the social issues, especially which are consistently
affecting the target customer base of the organisation.
Analysing the reason behind such mentality of the consumer sections Mann (2019), reports that
less than 30% of Australians are now able to trust their political institutions. They might be one
among the supporters of a certain political party. However in spite of that it are the favourite
consumer brands which the general public account for voicing the issues regarding society. Most
of the business schools are not concerned about this issue and repetitive examples can be found
in the last three decades when the CEOs have been forced to speak out on the public stage
regarding social issues. One major decision in this context was taken by the CEO of Nike
Corporation when we decided to give voice to Colin Kaepernick (Mashamaite and Raseala,
2019). As an outcome of taking a public stand on this issue, Nike experienced a hike in stock
value immediately. However it is evident that overtime tremendous public relation values will be
attached with the organisation when the opinion of the company regarding the social issue will
be spread among the public. Customers consider those brands to be authentic which have a
steady opinion about the public issues of the society. Since long time back, Nike have been
stating in the mission statement that they stand by the athletes and respect taking position in

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favour of them. As it has been essentially stated in this essay that the public prefer to those
brands that always speak up in favour or against the social issues that concerns the specific target
customers of the organisation. Hence, it is evident that when Nike decided to speak up in favour
of the athletes, it was a great business decision as well as a successful public relation campaign
also. In this context, famous journalists have spoken that:
“great leaders stick their neck out bringing people with them” (O’Callaghan, 2016).
This shows that there has been a major shift in the role played by corporate leadership. The
demand for the CEOs to speak up in favour or against social or political issues has been a noble
trained and many researchers like Ylönen and Teivainen (2018), perceive that it is a sustainable
trend also. A primary survey conducted among the consumers of high end products as well as
small retail products in Australia, reviews that it is the tendency of more than 90% of the
customers to purchase maximum products from brand, if any member of the higher managerial
committee of the organisation speaks up for the social issues which the particular customer
agrees with. On the contrary, in this context it can also be highlighted that Uldam (2018), if the
popular opinion provided by the CEO of the organisation is against that of the particular
customer, in that case the customers are educated and they seem to abandon the brand forever.
Hence, although there is popular public demand in favour of the corporate organisations to
provide their statement in favour or against the social issues, most customers prefer that their
opinion should match withtheir respective individual opinion.
Along withthe consumers, the employees of the organisation also feel that they have a right to
know the the position of the CEO of the higher management of the organisation regarding any
definite political aspect or any social issue. 80% of the employees of big corporations feel like
this. in fact, there are specific stakeholder groups of an organisation which think that if the CEO

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or the management of an organisation is speaking in favour or against any political or social
issue, they are necessary defending the people’s rights in the community. They perceive this to
be a sign of great corporate leadership. However, in this context Maak, Pless and Voegtlin
(2016), speak that the same risk as stated above regarding the general customers, exists with the
case of organisational stakeholders also. 84% of major client groups of big organisations of
Australia think that if the political opinion on the social opinion of the CEO of the organisation
does not match with their own position in context to those specific social or political issues, they
are less likely to engage in future business deals with the organisation.
This is an age, according to Gupta and Wowak (2017), where people question the political
authority and not able to trust the voice of politicians, completely. In this age, people seek for
truth in social media and public news sources. it is for this reason that the voice of the CEO of
any reputable company regarding any social issue is a great matter of of interest for the public. In
this context, researchers like Cao et al. (2018), argue that the people have an inherent conception
that the CEO of the business organisations are supposed to be authentic as well as principled in
their representation of Ideas regarding the social views. Every individual have different
perception about this social issues and they are actually searching for a link between the
perception of a great personality, that is in this case the CEO of the organisation and his or her
own idea about that issue. The customers are the general public feel more socially responsible if
their ideas match with the popular opinion presented by the CEO. This is why, organisation have
to think a lot before taking any public stance regarding any social issue. Now, the question raised
by Bowman (2017), in this context is that if the CEOs have to think twice before making
regarding a social political issue, how far is their opinion, authentic? An authentic not depend
upon the fear of Bing spotted as biased or becoming unpopular with the customers. This is why,

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researchers like Men and Tsai (2016), have presented the idea that political and social issues are
being commented upon by the CEO s of the organisations with at least a slight hint of business
motives or interest. They have the idea that the public wants to hear what they themselves been
to be true regarding the social issue. There are actually very few organisations who have the zest
regarding originality political and social issue, rather than winning over the target Market by
making a commentary regarding a social issue after serving the popular perception regarding the
issue among the public. Commercialization of speeches is a true fact for political leaders. At the
current moment, the higher managers of many companies of Australia are working on the same
path of attracting customers by providing speeches regarding social issues which will make them
appear to be socially responsible before the customers.
This is why, the aspect of profitability has now been linked with the popular public opinion of
the organisation and leaders regarding any major social issue. It is the organisation that benefits
from this initiative and rather than an effort of delivering the truth to the public, such public
Revelation about opinion regarding social issues can be perceived more as a a public relation
campaign by the business organisations. As highlighted by Elnahas and Kim (2017), 69% of the
organisations of Australia indulge in to simulated public relation campaigns where the major
topic of discussion is not the product or services of the organisation but a popular social issue.
Babenko, Fedaseyeu and Zhang (2019), suggest further more that this is the most viable
opportunity for the organisations to build trust among the open customer basis and thereby
develop their own target customer base by ensuring market segmentation.
Babenko, Fedaseyeu and Zhang (2019), expect that in the future this kind of campaigns will
become more popular and the public-private interaction will Foster in this way. In fact Uldam
(2018), observes that because of the emergence of this trend of public speaking by the CEOs in

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favour or against in social or political issues, organisations do not need to focus on the product
quality in order to attract customer bases initially. 68% of the big corporations have adopted this
strategy whenever the attempted to penetrate into any new market. that is why, if the growing
demand of the public for deliverance of public opinion by the organisational details on any
contemporary social issue is considered from an ethical perspective it can be easily
communicated that search initiatives can be separated from an utilitarian view of organisational
behaviour. This campaign can help in in achieving popular favour of the target group of
customers and that is why it will satisfy the interest of almost all the stakeholder groups of the
company. Nevertheless, considering from a deontological perspective it can be communicated
that there is no virtue or business ethics associated with the politicisation of the corporate
organisations. Nevertheless, there is a different group of critics like Cao et al. (2018), who argue
that it is true that the position that is taken by the corporate organisations regarding the social
issues are not always authentic and mostly done for mind framing the customers. Nevertheless,
there exist in the society as a popular alternative force which the power and position to speak
about out the political and social issues. This helps to keep the political forces in check and they
perceive that it is essential to act ethically. Hence, the corporate forces help to keep a balance in
the society and reduce the number of social or political scams.
Conclusion
However, lastly the argument of Bowman (2017), in the context of politicisation of corporate
organisations, can be presented here. The researchers argue that there are a small group of
Corporate organisations who actually have and unique voice in context to the political or social
occurrences and feel that it is necessary to communicate the same with audience. In this context,
question can be raised that how is it possible to identify whether the corporate organisations are

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making public commentary on the social issues, voluntary or with a business interest in the back
of their head? The answer is provided in the arguments of Elnahas and Kim (2017). They state
that when the companies are speaking voluntarily about any political or social issue, they will
always provide a strong justification as to why they have taken up the step to communicate their
opinion regarding the social issue with the audience. In general, the companies which do the
same voluntarily, are mostly motivated by the objective of their employees. This is because their
employees want the company which they work for to become representative Force for the society
and take step whenever any injustice has been done with the community where they live. In this
contest Babenko, Fedaseyeu and Zhang (2019), holds that most external group of stakeholders
Give maximum value to the organisation which gives value to the sentiment of their employees.
Politicisation is not new campaign. However, the only difference is that back in the middle half
of the twentieth century, most of the organisations communicate with the public regarding their
political opinion, voluntarily. In the current business oriented world, communication of political
social issues has been elevated to the standard of a business trend by the customers. More than
the honest urge of making the people informed about the authenticity and originality of any
social issue, what drives the CEO of most organisations to come up and speak about social issue
is the interest to know about the customer groups in a better way. This helps the companies to
develop products and marketing strategies keeping in mind the nature and perception of the
popular customer groups.

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Reference List
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