Boards of directors are increasingly having to make difficult decisions arising from social or political issues. In today’s social media environment, companies can quickly find themselves facing consumer boycotts, targeted media campaigns, and other adverse publicity that could harm shareholder value. These threats may arise from the company’s product line or services, or more indirectly from its affiliation with another business or political organization.
Companies may decide to take a stance to build consumer goodwill, avoid criticism or backlash, or even because the issue has a direct bearing on the company’s operations (e.g., immigration policy). Last year, for example, several chief executive officers resigned from the president’s American Manufacturing Council. Other times, companies may choose to do nothing or try to remove themselves from the debate. In addition to dealing with these complex business decisions, boards also are being confronted by investors who are increasingly focused on environmental, social, and governance issues.
Steven M. Haas and Meghan Garrant from Hunton Andrews Kurth discuss the intensifying boardroom environment of dealing with political and social issues by using gun violence as a recent example in an article that can be accessed here.