As issues of social justice and climate change intensify, the public increasingly expects companies to take a stand. But this is easier said in a press release than done in action. The number of companies that have failed to follow through on their publicly stated values is so high that we now have terms like ‘green-washing’ and ‘virtue signaling’ to describe this phenomenon. The jargon conveys the deep cynicism that consumers and employees experience when they see a company telling one story publicly but carrying out another in their business practices. That gap between words and deeds doesn’t just tarnish a company’s reputation. It also takes a toll on employee wellbeing.
Employees Are Listening In
In our time of social and environmental upheaval, employers regularly find themselves being asked to stake out positions on everything from voting rights to rainforest deforestation. When companies leave a gap between their words and their actions, we usually hear about outraged responses from consumers. They accuse companies of ‘green washing,’ committing loudly to environmentally friendly initiatives whose effects are dwarfed by a firm’s carbon footprint. Or ‘virtue signaling,’ taking a stand on a hot-button issue even though the company has made no real commitment to challenging injustice.
Employees are listening, too. According to Harvard Business Review, ‘people want to work for organizations whose missions and business philosophies resonate with them intellectually and emotionally’ 1. That means companies caught in the hypocrisy of not living up to their public image will lose the trust of their workforce. Management consultant Jon Izzo, who has worked with brands like HP, Coca-Cola and IBM, writes that, ‘Employees can see straight through the empty rhetoric when it is used solely for the sake of business’ 2.
A survey by consultancy firm Kin&Co revealed that this narrative mismatch takes a toll on employees’ mental health and satisfaction at work. Two-thirds of workers said that seeing their company fail to embody its stated values would negatively impact their work and morale, and almost half said it could make them want to quit. Overall, the study found this gap leads to a distrust of leadership and reduced productivity and job satisfaction 3. Clearly, it’s hard to maintain employee wellbeing so long as the gap persists.
When Talk Seems Cheap
The Black Lives Matter uprising in summer 2020 prompted dozens of companies that don’t usually weigh in on politics to make bold statements on and commitments to diversity, equity and inclusion. Nine months later, Republicans in Georgia introduced a bill that restricts voting access in ways that disproportionately affect Black voters. Activists called on prominent companies based in Georgia that had made commitments the previous year, particularly Delta and Coca-Cola, to fight the bill.
But the firms made only broad statements in support of democratic participation, without specifically challenging the bill or its racial implications. The tepid responses, activists said, came too late, and the bill is now law. ‘These are the character moments when you get to see whether or not they walk their talk,’ Nse Efot, a Black voting rights activist who led the effort, told the Guardian. ‘It’s one thing to post your solidarity on social media and it’s another thing to stop something really harmful from happening to the Black community.’ 4
These legacy firms previously maintained public images based on the products and services they offer, rather than their ambitions to change the world. It’s a different story for the tech industry where many companies are founded on near-utopian narratives of connecting people, sharing knowledge and building an exciting global future. These ideals have been a significant draw for many employees, but in recent years, such promises have in many cases turned out to be tall tales.
In response to last year’s Black Lives Matter protests, Google committed publicly to many changes that included increasing Black representation among senior staff. But that December, Google pushed out its most prominent Black researcher, Dr. Timnit Gebru, a renowned expert in artificial intelligence. Their reason? She had repeatedly voiced concern about a lack of diversity at the company, and wanted to publish research that questioned the ethics and environmental impact of machine learning, one of Google’s core technologies. In an interview with NPR, Gebru said her former employer ‘wanted to have the idea of me being at Google, but not the reality of me being at Google’ 5.
Following the firing, over 2,700 employees signed a letter demanding the company commit to a higher standard of research integrity. The letter also argued that firing Gebru over her support of diversity initiatives created a hostile environment for Black workers. This wasn’t the first time Google lowered morale with its handling of bias issues. In 2018, over 20,000 employees worldwide staged a walkout to protest poor company responses to sexual harassment.
At Amazon, internal accusations of green-washing set off a series of events that led to the loss of one of the company’s most valued engineers. In 2019, the e-commerce and web hosting giant committed to being carbon-neutral by 2040, among other environmentally friendly changes. Many employees were outraged and dismayed by what they saw as a timid plan from a company that could instead be a climate leader. In response, a new internal group called Amazon Employees for Climate Justice (AECJ) released an open letter signed by 8,700 workers asking their employer to commit to more significant action. They also pointed out that Amazon funds politicians and think tanks that deny climate science, and sells its AWS software to oil and fracked gas companies that use cloud computing to improve their drilling operations.
CEO Jeff Bezos and the board of directors ignored the letter, so AECJ continued its pressure campaign, with members sometimes speaking out publicly in defiance of company protocol. In April 2020, the company fired two AECJ organizers who had also criticized Amazon’s commitment to its warehouse workers’ safety amidst the Covid-19 pandemic. A month later Tim Bray, an Amazon VP with over two decades’ experience as a leading software developer, publicly resigned in solidarity. He objected to Amazon firing not just the AECJ organizers, but also several warehouse workers who had spoken out about their pandemic working conditions. ‘Remaining an Amazon VP would have meant, in effect, signing off on actions I despised. So I resigned,’ Bray wrote in a blog post 6.
Tech companies are not the only ones to face criticism for their labor and environmental practices. Last year, Starbucks was confronted with the gap between its stated commitment to ‘100% ethically sourced coffee’ 7 and a horrifying reality: Children as young as eight picked coffee for some of the company’s Guatemalan suppliers. A lack of investment in auditing their supply chain put Starbucks in this position, diminishing their standing in the eyes of both customers and employees.
Disney, too, has come under fire for poor treatment of its workers. Beginning in 2018, a series of reports revealed that many of its theme park workers were paid USD 15 per hour, while CEO Bob Iger got a compensation package worth over USD 100 million yearly. Some full-time employees at Disneyland made so little that they could not afford rent and slept in their cars. When the company shuttered its parks in response to the Covid-19 pandemic, it cut costs by laying off half of its workforce, while protecting executive bonus schemes. The company’s image of creating magic and delight, it turned out, was a fairy tale for many of the people who made the magic happen.
Closing the Gap
It doesn’t have to be this way. There’s a flip side to the gap, which is companies writing true stories about themselves.
Around the same time that Georgia Republicans introduced their voting restrictions, Texas Republicans took similar steps. But after seeing the backlash against companies that failed to condemn Georgia’s legislation, equivalent firms with big footprints in Texas took a clearer stance. American Airlines, Dell and Microsoft all made statements that strongly and specifically opposed the restrictive bills. Clearly, companies can learn from their and competitors’ mistakes to close the gap i.
In the oft-beleaguered tech sector, SAP stands out for having a long-running commitment to both diversity and environmental action. Even before the 2020 Black Lives Matter protests, the multinational enterprise software firm was recruiting from historically black colleges and universities, integrating neurodiverse talent into the company and fostering robust affinity groups for women and minority workers. So when the company made a bold statement that summer in support of ending racism, the promise rang true instead of false. SAP went farther than many companies to recognize that even a good thing can be made better. In 2021, the company pledged to re-examine its practices to root out unexamined hiring and workplace biases.
But the smallest gap in business likely belongs to Patagonia, the outdoor goods retailer whose founding story includes a commitment to environmental protection. The company donates 1% of its revenue to environmental causes, lobbies legislators to protect the outdoors, makes grants to grassroots activists and encourages customers to repair products instead of buying new ones. It even pays bail, legal fees and vacation time for employees who are arrested at non-violent environmental protests. For this narrative consistency, Patagonia gets a happy ending in the form of a turnover rate of just 4%.
But in some ways, Patagonia has it easy, because its lifelong commitment to the environment meant a gap never opened. For companies without such unwavering morals, closing the gap is a matter of frankly assessing the relationship between values and capacity.
If leaders at an organization want to join calls for progress, but don’t want to be accused of green-washing or virtue signaling, they should only do so if they’re ready to be transparent and make difficult decisions down the line. A company that is honest about its carbon footprint and willing to lose customers in the oil and gas industry can reasonably make pro-climate statements. A firm that consistently supports employees from marginalized backgrounds, even when those employees call for time-consuming or expensive changes to internal policies and business practices, can align itself with movements for social change.
Not only is it likely the right thing to do – employees will be the better for it.
Zoë Beery is a freelance reporter covering cultural and political change. A former editor at the Village Voice, she has contributed to the New York Times, Buzzfeed, Teen Vogue, the Baffler and many other publications.
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