By Marc J. Lane
Democracy Works, the nonpartisan, nonprofit organization committed to helping Americans vote, has released a new study reporting that companies with a culture of civic engagement grow faster, enjoy financial performance and earn higher market returns while strengthening our nation. Its publicly traded Civic Alliance member companies, each of which has embraced a civic engagement strategy, outperformed the S&P 500 average price/book value, gross margins, and total revenue over the one-year period ending July 2021.
Of course, correlation is not causation, and civic engagement isn’t a ticket to corporate success. Other factors clearly contribute to companies’ financial outperformance.
But Democracy Works’ data square with a growing body of evidence that companies that seek to address social and environmental problems do a better job of recruiting and retaining the very best employees. Diversity, equity and inclusion are good business. And exemplary corporate citizenship not only breeds brand loyalty; it also nurtures leaders.
There’s no question that the historically high voter turnout for the 2020 Presidential election held in the midst of the pandemic can be attributed, at least in part, to greater corporate participation in our civic life, with companies offering voter-themed merchandise, providing rides to the polls and giving employees time off to vote.
Since then corporations have withheld donations from legislators who fought the certification of President Biden’s election or supported restrictive voting laws. Even more recently, companies have abandoned their investments or physical presence in Russia as it attacked Ukraine without provocation and reconsidered whether they should continue to do business in states that have passed anti-trans or “Don’t Say Gay” laws.
But how can a company motivate people to participate in shaping the affairs of its community and nation through the democratic process? The answer lies in its policies, its practices and its communications, and how it supports education and action without regard to political party or political outcome.
Savvy corporate leaders encourage voter registration and participation. They create a voter-friendly workplace. They educate employees about civics. They get their employees and customers excited about participating in civic activities. And they engage all their stakeholders to help democracy flourish.
But, increasingly, leading companies also seek out opportunities to source goods and services from enterprising nonprofit organizations and mission-driven, for-profit ventures, thereby elevating their supply chains to “value chains.” They mentor nonprofits and social enterprises. They partner with them and even invest in them.
In this age of Covid, the racial reckoning and the existential threat of climate change, values-based companies see social impact as a new form of currency. They use their voices and resources to support their people and their communities. They empower their employees and consumers to be active citizens who take stands on issues from voter participation to gun violence to racial justice to gender equity.
We urge your company to be among them.
The Law Offices of Marc J. Lane and its financial-services affiliates are deeply immersed in the evolving Social Impact ecosystem. We would be privileged to help your company explore ways in which its Corporate Social Responsibiliity (CSR) strategy can be optimized and amplified. To leaarn more, please feel free to reach out to Marc Lane, in confidence, at mlane@MarcJLane.com or 312-372-1040.