Ep 105 Political Crisis Communications for Big Companies in Small-Minded Towns April 14, 16

So what do you do if you're a corporation, a large corporation doing business in a state or municipality that passes wildly discriminatory laws?

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So here's the particular situation. In March of 2016, the North Carolina legislature passed some laws that struck many people as rather curious. It was also signed into law by Governor Pat McCrory. This is a law to eliminate anti discrimination protections for all lesbians, gays and bisexuals, barring transgender people from using bathrooms that do not match the gender they were born with. Very, very stark battle lines. Here's the issue. And folks, this show is not a political show where I get to pontificate on my political views and have a debate. Everybody has political views, but there's plenty of other shows for that. But I do want to dissect this from a crisis communication standpoint. So the legislature passed a law. The governor passed a law that by an awful lot of people, indeed many polls would say most people, as just kind of spitting in the face of gay people, transgendered people. You think you were born of the wrong gender. You perhaps have a gender reassignment surgery and you now want to go to the bathroom and the gender you currently associate with. And the North Carolina legislature, with all the problems going on in that state, has taken it upon itself to say to all the other cities and counties, you better not pass any law. You can't pass a law permitting people to go to the bathroom where they need to feel they need to go. Now, very, very conservative Republicans and those who consider themselves a part of the right wing, we're pushing for this legislation. And I should note, by the way, North Carolina is where I'm from. Those of you who occasionally detect a slight Southern lilt on some of the words I pronounce, it is a North Carolina influence. I moved there at age 5 and didn't move away until I was 22 years old. Still have family there. So it is what I consider basically my home state. So. So it is with no great pride that I bring up this issue. As soon as it happened, there were massive rallies, public rallies, denunciations in social media, civic groups. A lot of business leaders and a lot of Republicans showed utter contempt and dismay at this law. There are a number of major corporations that do business in the United States felt compelled to speak out. American Airlines has 14,000 employees in the state. Its second largest hub is Charlotte, where, in fact, I'm from. Other big companies, Apple, Dow Chemical, PayPal, Red Hat, Biogen, all of these companies issued statements that were highly critical of the new law. Here's a typical example. This from the Apple Computer company or just Apple Company now our future as Americans should be focused on inclusion and prosperity and not discrimination and division. We were disappointed to see Governor McCrory sign this legislation. Here's another statement from another organization. Mitchell Gold, chairman of Mitchell Gold and Bob Williams Home Furnishings. It's one of the dwindling number of companies that still manufactures furniture in the state. He said it's outrageous. It's so un American. It's short sighted. And this is the New York Times story pointing out that Mr. Gold is gay. The folks that want this passed, when you look at who they are, at who these people are, they are the people who are using their outdated, misguided, ill informed race, religious teachings to discriminate. Now there are predictions that the state could suffer economic fallout. The NAACP or excuse me, the NCAA is thinking of holding tournaments in North Carolina in 2017 and 2018. They don't have to. They can get so much criticism that they pull it. They put out a statement saying they continue to monitor current events, which includes issues surrounding diversity in all cities bidding on NCAA championships and events, as well as cities that have already been named as future host cities. On Twitter, there's a new account specifically calling for a boycott of the state. Chris Sacca has said that he's no longer going to invest in any businesses in North Carolina. Now, Chris Sacca, for those of you who follow the startup world, is the most wildly successful venture capitalist in the history of the world. So you can, if you're a conservative business person, you can sort of, you know, pooh pooh a so called activist or community activist. But it's pretty hard to mock and ridicule the most successful billionaire venture capitalist in the world. Folks, this is the difference between politics and the business world. And the odd thing is people often just assume business leaders are inherently more conservative and more cautious. Well, they can be more cautious, but not conservative in the traditional sense of the word. More on that in just a moment.

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So folks, let me delve a little deeper. What I think is really going on here. And I am going to have to talk about politics. I assure you it's not to proselytize you or convince you of a certain party or candidate or against someone. But Pat McCrory, the governor of North Carolina has always been held in high suspicion by the conservative Republicans in that state. He had a reputation of being a moderate mayor of Charlotte, which in fact he was as someone who frankly didn't really care about conservative social issues. He was just a guy who sort of wanted to get business done. Pro growth, pro business. Very common to a lot of Republicans profile in the past, not as much now. So most analysts conclude this is something he's doing to burnish his credentials. The reason he signed off on this law, even though it's bad for business, to make himself attractive to the conservative base of his party, because he's a lot more worried about primary opposition or not having the base of the party galvanized behind him for a general election than he is worried about being called too conservative by liberals and Democrats because he figures he's not going to get their votes anyway. So in politics, if you can get a plurality of the votes plus one. Well, if you can get a majority plus one or there's multiple candidates, if you can just get a plurality, you win everything. The other candidates, they go out of business the next day, their campaigns go out of business. So it really is sort of a zero sum game when you're in business, especially a big business. I mean, if you're Apple, you have to sell computers to everybody. You have to sell computers and iPhones and iPads to conservative Republicans and you have to sell to liberals and Democrats and moderates, and you have to sell to everyone. So you do not have the luxury of being seen as endorsing something that perhaps 2/3 of a society or of a marketplace views as extremist. If you're a political candidate, endorsing a position right or left that's seen as extremist by 2/3 of the population might be a good thing for you. Helps you galvanize a base, helps you find a true, true solid fan base. Business people don't do that. As I mentioned, the names of some of these corporations, American Airlines, Apple, PayPal. I mean, who doesn't use PayPal? It's not PayPal just for conservative traditional republic, it's PayPal for everyone. So what can you do if you're a company, I think these companies did the right thing. Even if they personally like this legislation. It's still a good business practice to stand up and say, we don't approve of something in our place of business, our communities of business that we think is really bad to our customers and that's what these corporations are doing. I think it is a wise and smart plan. Because these days your customers are looking at everything you do and everything you don't do. Silence speaks volumes. If you are a corporation and you are doing hundreds of millions or billions of dollars of business in a community or a state, your tax dollars are essentially paying for a lot of that government. So that government is doing horrific things and you stand by silently. It's seen as endorsement. Certainly if the governor said we're going to tax all major corporations double their income tax as a corporation, no one would be shocked at all If Apple and PayPal and American Airlines said we don't want our corporate taxes double. In this case, they're speaking out in something that doesn't immediately affect their bottom line, but does send messages to their customers about how they are as corporate citizens. If you're a really small company, I think you can get away with just ignoring it. Nobody expects you to monitor every single piece of legislation if you are a six person graphics arts company or graphics design company in a small town in North Carolina. But when you're a huge company doing millions and millions or some case billions of dollars of business with customers throughout the vast swath of society, you do have to speak out. So it's always fun for people like me doing a show like this to point fingers at people doing it wrong. Aha. That's bad. That's wrong. Look at the CEO of VP saying stupid things and ruining his career. It's less interesting to people. But I want to be honest with you and bring some integrity to this show and point out when people are doing things well. And I think in this particular case, these major corporations are doing exactly the right thing. So hats off to Apple, Dow Chemical, PayPal, Red Hat and Biogen. And there may have been others that just did not get included into this New York times story. I'm T.J. walker. Anytime you have a question about speaking to the media during a crisis or good times or giving presentations, let me know and I will devote a good section of this show to answering your exact questions. So send me your questions. You can email them tjediatrainingworldwide.com or on Twitter jwalker. As always, may all of your presentations in life be a huge success.

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