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The violent attack on the U.S. Capitol on January 6 was a “watershed moment” for businesses, forcing many to reconsider their civic responsibilities alongside their corporate values, Wharton management professor Michael Useem said.
Several companies set aside profits in their decisions immediately following the deadly riot, when thousands of Donald Trump supporters stormed the capitol to stop Congress from certifying the election of Joe Biden as the 46th president. Twitter lost a reported $5 billion in market value after taking Trump permanently off its platform. Delta, United, American and Southwest airlines temporarily banned firearms on all flights to Washington, D.C. And vacation rental site Airbnb blocked and canceled all reservations in the metro area for inauguration week.
Those decisions show how companies are stepping up to “make a difference where they can make a difference,” Useem said during an interview with the Wharton Business Daily radio show on Sirius XM. (Listen to the podcast above.) “What’s really significant here is these kinds of actions weren’t commonly seen at all, but now they have become widespread in the wake of the events of January 6. So, it’s a watershed.”
“This is one of those irreversible moments of a sea change, so I think life is going to be different for corporate America after the events of January 6.” –Michael Useem
‘A Stripe of the Past’
According to Useem, executives and boards of directors across America are rethinking what it means to do business in a democracy in the wake of the attack. Staying out of the political fray is “a stripe of the past,” especially when so much is at stake, he said. Employees, consumers and other stakeholders want companies to get involved. In fact, they demand it. At Twitter, for example, CEO Jack Dorsey banned Trump after more than 300 employees wrote a letter urging him to do so. In a news release, Airbnb CEO Brian Chesky said he cancelled inauguration week reservations in response to local, state and federal officials asking people not to travel to the capital, and the company is working with authorities to identify hate-group members within its customer base. At the airlines, flight attendants have been the driving force behind no-fly lists.
“This is one of those irreversible moments of a sea change, so I think life is going to be different for corporate America after the events of January 6,” said Useem, who is also director of the Center for Leadership and Change Management at Wharton.
Companies are also facing a paradox. They need to balance short-term results for investors and owners with a long-term strategy for the health of the business. Useem said executives like Chesky are recognizing the bigger threat that comes from the erosion of democratic principles, and they are willing to take a financial hit in the short term to help ensure the republic survives. Most recently, on January 17, Loews Hotel Group canceled a February fundraiser for Republican Sen. Josh Hawley, who objected to the certification of Biden’s presidency on the day of the riot. “Loews Hotels & Co is horrified and opposed to the January 6th events at the Capitol and all who supported and incited those actions,” a Loews spokesperson said in a statement.
Corporations are also scrutinizing political donations; many have announced they will stop donating to PACs or individual candidates who supported the failed effort not to certify Biden’s election. Useem said politics has become a major topic of discussion for executives trying to figure out their role in the protection of democratic values.
“I think people on boards and in the C-suites are unequivocally coming to the view that we’ve got to step forward now,” he said.
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3 Comments So Far
Richard Schaefer
I think lobbyists should be banned from the Capitol along with corporate donations and PAC donations. They get in the way of the common people.
Donations should be from the voters. And they should be limited to no more than $1,000 for each person. I’m tired of seeing the horse races posted every day on how many billions of dollars any candidate raised. Whatever happened to old-time barnstorming ? Political TV ads these days are distorted, convoluted smear campaigns that warp people’s minds. What’s True? What’s False. Nobody knows anymore.
The social networks are now king and they spew out their own beliefs and deny people the freedom of speech unless it fits in with their dogma. Yes, it is time that they be reigned in by the anti-trust laws.
I know some of you reading this will think it is too draconian, but I am exerting my freedom of speech – while I can.
Thomas Lauterio
I agree with the above statement that there isn’t truthfulness in communications nor consistency in dealing with people by social media and tech giants. There were a few radicals who stormed the Capitol. Contrast that to the majority who were peaceful or to the many riots that occurred during the past year as well as inciteful language from liberal individuals. Either everything is allowed or you have a dangerous situation where specific groups are cut off. The dialog is now focused on a few radicals and that is an excuse to shut out millions. It is the right of elected officials to not accept election results. Nancy Pelosi did so in 2017, yet that was not considered “radical” or “anti-patriotic”. That there was real fraud this election in not the question – there absolutely is documented fraud. People who state that are not anti-patriotic or crazy. In Pennsylvania, the legislature is trying to figure out what steps to take to fix this or prevent it in the future. Whether it impacted the election will never be known. But shutting down the discussion as to how to insure honest elections is the real threat to freedom and voter rights.
Jeff Harrison
I am stunned you simply use January 6th as an “irreversible moment”. This country has been on fire for four years, thousands of buildings looted and destroyed. Police killed and harassed like I’ve never seen. Repeated coup attempts of a sitting president. Russian collusion proven (dossier) not performed by the past president, but of a past president’s wife,. 150 year old monuments destroyed all across the nation. Massive cheating by democrats of the presidential election (yes I have seen all the evidence and believe it fully so do millions of other people), putting a senile old guy who campaigned from his basement in office, FBI so corrupt people have lost confidence in them and the election system – and it’s January 6th that corporations fear? WOW. I’m sure you won’t print this, but if you do I will have respect for your site. I did sign up for this article – Thank you. I do enjoy your articles, but I had to comment on this one. God Bless. Thank you.