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CEO activism and how we shop
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Screenshot 2018-03-12 22.54.46.png

 

Dick's Sporting Goods' CEO Edward Stack made an announcement in the wake of the latest school shootings: they will no longer sell AR-15 automatic rifles, and they have raised the age of persons to which they will sell guns to 21. Other companies--Delta, Hertz and Symantec--have rescinded special group discount privileges they previously granted National Rifle Association members. 

Curiously, many customers walked into a Dicks Sporting Goods store for the first time to make a purchase and to pass on their support as a result of the announcement. Also, the stock has seen a small bump in price.

 

The practice of "CEO activism" can be risky, however. Backlash can come from customers, the public, stockholders, and legislators. Employees may also feel uncomfortable. On the other hand, support may arise from among stakeholders. Employee morale might increase. 

 

Those who study business ethics find that ethical positions influence corporations in a "top down" way. It actually matters what positions are taken by those at the top. 

 

Source: "Our Newest Cultural Warriors: Activist CEOs," by Aaron K. Chatterji, New York Times, March 2, 2018. [Cover photo from article

Follow up:

  • Define "CEO activism." Give several examples.
  • Research the political positions taken by Chick-Fil-A, Target, and Papa John's executives, and their effect on public opinion and corporate value. Report and comment on the results.
  • What backlash occurred in Georgia as a result of Delta's activism?
  • What might be the effect among employees as a result of CEO activism? Describe both positive and negative possibilities.