Business Leaders Need Smarter Strategies to Navigate the Culture Wars

March 6, 2023 | By BRUCE P. MEHLMAN

In addition to inflation, deglobalization & disruptive innovation, 2023 CEOs confront expanding culture wars. To successfully navigate them, C-suites need to follow four rules, offered below.

“Don’t take a stand if you don’t have a plan.” – Bruce

Culture wars are crashing the C-suite, and CEOs need to up their games.

For over a decade, progressive activists have urged business leaders to speak out more on social and cultural issues, and many responded. This increased engagement emerged alongside accelerating ESG initiatives reacting to climate change, EU regulation, and geopolitical disruption.

Over the past few years, conservative activists started punching back, objecting to what they consider political investing—aka “woke capitalism”—by unelected technocrats who are supposed to focus on maximizing shareholder value rather than signal virtue.

CEOs are now caught in the crossfire. And in 2023, these challenges are only getting harder.

A record 39 states now boast one-party rule, increasing the likelihood of straight-line partisan legislation at odds with states run by the other party. Congress is again narrowly divided, with both parties looking for populist credit for punishing ideological opposition among “the establishment.”

The 2024 presidential campaign is fully underway, with GOP aspirants competing to be most “anti-woke.” The president’s very first veto is imminent on legislation hostile to ESG.

Thankfully, business leaders are getting better at negotiating these fraught issues. The successes and failures of other CEOs navigating the past decade’s culture wars offer useful lessons for those presently helming companies.

Specifically, four key strategies stand out, each with an internal and external component. Here’s what CEOs need to consider in this politicized environment.

Recognize This Challenge Is a Team Sport

Internally, this means convening a consistent, diverse team of senior advisers who bring different expertise, organizational awareness, lived experiences, and ideologies. This collaboration needs full C-suite support.

Externally, team play requires close coordination with sectoral and regional allies. Opportunities for market advantage are lower than risks from acting alone—there’s safety in numbers and wisdom in crowds.

Communicate Openly and Consistently

This goes especially when communicating with employees. They are the key stakeholder here, as most companies’ customer bases are more diverse and shareholders usually prefer companies sit things out.

It is more important for a CEO to speak to their employees than for them. Trusted leadership requires regular listening, rather than only interacting at times of crisis. Employees are far more likely to accept a decision when they know they’ve been heard.

Externally, businesses need to stop moralizing. Justify decisions in business terms, and if there is no business justification whatsoever, perhaps reconsider. Align words and deeds with stated values. Speaking out today builds expectations you’ll weigh in tomorrow.

Build Replicable Processes

Internally this means practice. The teams leading these issues need to develop muscle memory rather than learn on the fly. While no one ever prepares for the exact scenario presented, planning against foreseeable risks increases odds of future success.

Externally, build processes that hear out both sides on tough issues. Read the actual legislation before endorsing or objecting to it, regardless of admiration for those urging engagement. Independently check the facts, as activist groups may claim greater support than proves true.

Prioritize Actions Over Words

CEOs prove they care by what they do, not what they tweet. To support employees’ community engagement, companies should offer paid time off to volunteer, charity matching programs to amplify their impact, and health benefits that clearly demonstrate your commitment.

Externally, support NGOs that are properly aligned with business values and operations outside the political sphere and, ideally, in advance of partisan culture clashes. It’s much easier to duck no-win media fights when you’re already supporting causes through meaningful action.

CEOs remain eager to attract, retain, and lead enthusiastic employees, including younger, more educated and diverse workers who are likeliest to urge engagement. They remain committed to running smarter and more resilient businesses.

But CEOs also need to operate in multiple jurisdictions—red states as well as blue, markets that price carbon, and those that don’t share liberal western values—to access markets, maintain supply chains, and obtain critical inputs.

Navigating stakeholder expectations is never easy, but the challenges are both inescapable and survivable. Don’t take a stand if you can’t take a punch. But don’t take a pass if you don’t have a plan.

This article does not necessarily reflect the opinion of The Bureau of National Affairs, Inc., the publisher of Bloomberg Law and Bloomberg Tax, or its owners.

Author Information

Bruce Mehlman served as Assistant Secretary of Commerce in the George W. Bush administration and leads a bipartisan consulting firm based in Washington, D.C.

ALSO SEE: Trigger Warnings! Social & cultural fights coming to the C-Suite in 2023.