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A new moral code: Disinformation and the changing role of business in social, environmental and political issues

March 2023
 by Lucy Hughes

A new moral code: Disinformation and the changing role of business in social, environmental and political issues

March 2023
 By Lucy Hughes

In today’s digital world, it has never been easier for corporate disinformation to spread like wildfire. When false or misleading information about a company is deliberately distributed to the masses online, the purpose is often to manipulate public perception, cause reputational damage, plummet share prices and trigger the economic decline of the company. As corporate disinformation evolves and becomes increasingly organised and widespread, these types of cyber-attacks are on the rise – taking forms ranging from fake ads and press releases to manipulated images and videos. In this environment, it is crucial that businesses remain aware of the risk and put in place an action plan to protect themselves in the event of such an attack.

The rise of ethically-charged corporate disinformation

While any business can be at risk of corporate disinformation, companies accused of unethical practices are often in the spotlight more than others. Any hint of unethical business practices could be exposed and amplified in hostile disinformation campaigns, so it’s more vital than ever for companies to ensure they have a clean sheet when it comes to their stance and behaviour regarding social, environmental and political issues.

These issues are so important because they are highly emotive, relating to our very sense of self. The expectation that the values of the companies we use, and those we work for, aligns with our own is stronger than ever. The public now expects companies to use their influence and become activists on a range of issues, speaking up and following through. Company hypocrisy and lethargy regarding social issues is quick to be called out and amplified by the media, employees, consumers, and shareholders.

How do businesses engage with social issues and activism?

Environmental credentials and ethical responsibility are the two pillars of social involvement for businesses, and there is increasing public pressure to get it right in both of these areas. On the environmental side, companies are now expected to prioritise reducing their negative impact on the planet with a range of policies such as recycling, replenishing natural resources, and reducing pollution, waste and greenhouse gas emissions.

The effects of climate change are set to become irreversible as soon as 2030 according to a UN Intergovernmental Panel on Climate Change (IPCC) report, and a sense of urgency is evident in the public demand for environmental responsibility from businesses, which reached new heights in 2022. More pressure has been put on supermarkets to become eco-friendly, and retailers such as Marks & Spencer are responding with a range of initiatives including anti-deforestation projects, sustainable cotton farming practices and reductions to their carbon footprint.

Ethical responsibility is equally important. In an increasing number of countries, companies have a duty to act in a fair and ethical manner towards their customers, employees, and job applicants, regardless of age, race, gender, disability, and sexual orientation. Starbucks is one company that has been applauded for making efforts to diversify its workforce. It has pledged to hire 25,000 US military veterans by 2025, and aims to have black, indigenous, and people of colour representing at least 30% of corporate roles by then. Having received a hugely positive response from employees, customers and shareholders to these initiatives and pledges, it is likely that other CEOs will follow suit.

How a social conscience benefits business

We live in a world where people are no longer turning a blind eye to unethical or unsustainable company practices, and this is especially true for the younger generation, as shown in a survey cited by Business for Social Responsibility (BSR) which revealed that up to 87% of millennials and 94% of Gen Zers expect companies to address pressing social and environmental issues. If a business wants positive brand recognition among the new generation, social responsibility is a must.

These credentials are also increasingly important to investors, with monetary gain no longer the sole motivation for investing in a company. A recent AFLAC survey found that 73% of investors rate a company’s efforts to improve the environment and society as a contributing factor to their investment decisions. Firms such as Marshall Wace are responding to this demand – the hedge fund plans to raise $1 billion for a green fund investing in stocks with strong environmental, sustainability and governance ratings.

Employee engagement is a further benefit gained by businesses who take positive action on social, environmental and political issues. Employees want to work for companies that represent and support their own values, and those who fail to do so risk employee apathy, recruitment and retention issues, and an unhealthy internal environment.

Disgruntled employees are more likely than ever to speak out against companies, whether through websites such as Glassdoor, or social media campaigns such as the one that targeted Brewdog in 2021, when ex-employees posted and signed an open letter on Twitter claiming that the company failed to treat their employees like human beings.

Why integrity is everything

Environmental pledges and initiatives need to come from the heart of a company and be carried out with care and commitment. It is not enough simply to claim green credentials – as greenwashing becomes increasingly obvious to the public, any missteps from companies aiming to shine a positive light on their sustainability efforts in a bid to appeal to environmentally-conscious consumers is increasingly likely to be exposed publicly, with negative consequences for the company’s reputation.

It is also important for companies to carry out due diligence ahead of new board appointments and campaigns, considering whether they can live up to their promises, how they will carry them out, whether there are any unsustainable actions from the past that may be unearthed, and how they will respond to any criticism.

Recently, activist groups installed 400 fake BMW and Toyota parody ads on billboards across European cities, aiming to highlight the alleged hypocrisy behind the automakers’ environmentalist marketing, and forcing the companies to put out a responsive statement in defence. Not only does this incident demonstrate the consequences of greenwashing accusations, but it also shows how easy it is for groups to spread news on behalf of highly successful and influential businesses.

Similarly, Adidas was targeted by a spoof press release from the activist duo the Yes Men, sent to fashion journalists from a fake Adidas email address. The release falsely announced the appointment of a former Cambodian union leader as Adidas’s new co-CEO, and the launch of a scrap-inspired collection of garments pre-worn by factory workers. The aim was reportedly to nudge Adidas CEO Bjørn Gulden in a more ethical direction, and to deter Adidas from future greenwashing. This case is a prime example of how disinformation can be used as a weapon to accuse brands of greenwashing, and it highlights the importance of an authentically ethical and environmentally-friendly ethos in reducing the risk of activist groups spreading corporate disinformation.

Looking ahead, the focus on social issues and activism for companies is set to continue. As climate change worsens, employees speak up on social media about questionable corporate practices, and human rights issues continue to make headlines, the pressure on companies to step up will only increase further.

In a world where information is so easily accessed and shared, high public expectations are driving extreme attempts to exert pressure on corporates to show their dedication to matters important to their consumers. For the next generation, integrity and values are all-important, but action to redress long-entrenched issues must be implemented carefully and sustainably – which rarely happens overnight. In this adjustment period, it is more important than ever for organisations to be attentive to corporate disinformation campaigns as they work to demonstrate they are taking responsibility as the voice of their customers, their shareholders and the wider world.

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