Originally Released On

PRNewswire

Media Contact

Kara Gelber
pr@stagwellglobal.com

Originally Released On

PRNewswire

Media Contact

Kara Gelber
pr@stagwellglobal.com

By

Stagwell’s Risk and Reputation Unit

How business is a key election issue

For the first time in decades, immigration is the number one concern for voters, according to the latest Harvard CAPS-Harris poll. Yet, when asked what issue matters most to voters personally, every demographic group picks inflation and cost increases.

This focus will bring business into the crossfire. With Donald Trump’s tax cuts set to expire next year, CEO pay and corporate taxes will become key talking points for both campaigns. With abortion rights rising to the fore again following Arizona’s recent Supreme Court decision, corporate health care policies could come under increased scrutiny, especially by political candidates looking to drum up outrage.

Equally, businesses with strong ties to China could come under fire.

Based on Stagwell’s experts working inside all the campaigns, Democrats and Republicans will be running hard on the following issues:

A battle of generations, not just parties

Age, not just than partisanship, also is behind several of the issues dividing Americans today. Gen Z is by far the most comfortable with employee activism, and tensions over Israel-Hamas continue to spill into the workplace. Google just fired 28 workers for participating in protests over its Israel contract. Universities have faced most of the criticism from politicians so far, but companies should be ready to be next.

The same pattern is emerging around TikTok. While roughly two thirds of Democrats, Republicans and Independents support a TikTok ban, there’s a wide difference by age. Gen Z (18-24-year-olds) is the only age group to oppose a TikTok ban (57%). At the other end, 84% of those 65 and older support the ban.

Key markets will be swamped with ads creating a negative communications environment

Stagwell’s omnichannel agency Assembly projects a record $12 billion will be spent across media channels this election cycle year. This spending will be highly targeted and concentrated in key markets.

Las Vegas, Philadelphia, Phoenix and Reno will be bombarded the most, followed by Pittsburgh, Tucson, Missoula, Billings, Boston, Wilkes Barre-Scranton, Butte-Bozeman, Detroit, Los Angeles, Charlotte, Atlanta, Cleveland, Cincinnati, Harrisburg, D.C. and Raleigh-Durham.

Importantly, as the election ads heat up, these markets will be inundated with nearly complete negativity – which will make communicating and marketing more difficult than ever. Specifically, negative advertising about the economy could not just affect people’s votes; it could depress their willingness to spend.

It is more important than ever for business leaders to be prepared for this election cycle with bipartisan advisory teams, integrated vetting processes, scenario planning and 24/7 monitoring.

Explore our full presentation on the issues driving the 2024 campaigns here.

ICYMI: Risk and Reputation Unit in the News

• BCG: Stay Silent? Speak Up? How CEOs Can Navigate a Polarized World
• Marketing Brew: How Stagwell’s politics-focused agencies are advising brands in 2024

By

Stagwell’s Risk and Reputation Unit

During COVID, businesses innovated and listened in warp speed. Leaders today need to do so again to create the next chapter of employee engagement and communications, while addressing diverging demographics and values about the future of work.

A Difference in Values and Diverging Demographics Are Causing WFH Culture War

Four years into the work-from-home experiment, the culture war is in full swing. Where you work has become a partisan issue.

Democrats are more likely than Republicans to say remote work is good for employee wellbeing (+13 percentage points), company bottom lines (+15 percentage points) and career advancement (+16 percentage points).

Republicans are more likely to say that it’s frustrating to hear complaints about in-person work when so many frontline workers do it daily (+9 percentage points); and that work has traditionally been “in-person” and that’s how it should be (+10 percentage points).

WFH is also a battle of generations. Millennials, along with Gen Z, are leading the WFH narrative and believe they have leverage over employers. In fact, 71% of Millennials believe they could readily seek out a job with higher pay. At the same time, Gen Z has a steep learning curve that WFH is not helping: 82% of managers say new Gen Z hires’ soft skills need more development.

What the Future of Work Looks Like Now That Everything’s Politicized

Americans increasingly care more about quality of life than simply climbing the corporate ladder. Employees’ top 2 priorities are to “build financial stability so I can pursue what I care more about” (37%) and to “establish a better work life balance” (35%).

Younger workers also believe businesses have broken promises made to them during COVID. That includes 67% of Millennials and 54% of workers overall who say they were promised better work-life balance that never happened. And it’s not just young people who prioritize “work to live” versus “live to work.” Of all American workers, 78% say they would be more loyal to a company that gave employees the freedom to choose where they work from.

What Business Leaders Should Do

To start, business leaders need to modernize employee communications and engagement. In most companies, more than 70% of employees want clearer views of company strategy. Half of employees want more focus on operational changes and organizational goals rather than macro news and generic business updates. In short, employees want more context.

In addition:

Explore the full presentation on the politicization of return to office here.

Mark Your Calendar: April Webinar on Cybersecurity

Our next 30-minute, free risk-and-reputation webinar is at noon ET Thursday, April 18. Together with Stagwell’s communications firm Allison, we will focus on how business leaders can build and protect reputations in the era of cyberwarfare and misinformation. To RSVP, email Alexis Williams.

ICYMI: Risk and Reputation Unit in the News

• Fast Company: It’s not just ‘woke.’ These are the most polarizing words in America
• Forbes: Why has ESG Become The Toxic Wordle In Asset Management?

By

Stagwell’s Risk and Reputation Unit

Acronyms Are Even More Polarizing

ESG and DEI continue to come under fire, confuse Americans and cause trouble for businesses using the terms. ESG is up 13 points in negativity, and DEI is up 11 points since December, based on Harris Poll data.

Some Americans feel negatively about DEI because they think “it prioritizes identity over merit,” according to the Harris Poll. They feel negatively about ESG because “it’s used by companies to improve their public image rather than genuine commitment to social and environmental responsibility.”

The problem with ESG and DEI is the acronym, however – not the concepts themselves.

Americans Agree with the Value behind DEI and ESG

81% of Americans agree that corporate America should reflect the diversity of the American population, and 78% agree that it should reflect racial diversity, according to a Harris Poll study with the Black Economic Alliance. Also, 79% of Americans think having more diverse leaders would allow for better outcomes in government, business and overall innovation.

The same is true for ESG: 52% say a brand’s sustainability efforts affect their purchase decisions, according to Stagwell’s National Research Group’s data. Gen Z and Millennials, in particular, believe sustainability needs to come from the top and be established by policymakers and big-company leaders.

“Equality” is 15 points less divisive than DEI. Similarly, “sustainability” is 24 points less divisive than ESG.

Case in point: BlackRock, the original champion of ESG, just announced a pivot to “transition investing.”

New News: IVF Is the Latest Divisive Acronym

In light of the Alabama Supreme Court’s decision jeopardizing IVF in the state, our latest Harris Poll data show the term “IVF” (in-vitro fertilization) is polarizing to 53% of Americans. This is despite the fact that 90% of those familiar with the concept believe people should have access to IVF to try having a baby.

Again, it’s the acronym versus the concept that is confusing and polarizing to many Americans.

March Webinar: The Politicization of Return to Work

Our next 30-minute, free risk-and-reputation webinar is at noon ET Thursday, March 21. This month, we focus on the politicization of return to work – including new data showing three in four Americans believe remote work has become unnecessarily politicized and 57% of companies are out of touch based on their policies. To RSVP, email Alexis Williams.

ICYMI: Risk and Reputation Unit in the News

• Inc/Fast Company: This CEO says business and politics don’t mix
  

By

Stagwell’s Risk and Reputation Unit

Americans Trust Local Institutions More than National Ones

American institutions, especially at the national level, are facing a huge deficit of trust. Harris Poll data show people get increasingly suspicious of those outside their own community:

• My friends/family: 84% trust information from this source
• Local TV news: 65%
• Local newspapers and news websites: 62%
• National newspapers and news websites: 55%
• National TV news: 55%
• Local political leaders: 50%
• National political leaders: 41%
• Social media: 35%

Americans of All Ages Use Social Media for News But Don’t Trust It

While 65% of Americans do not think social media is a trusted source of news, 66% have used social media to seek out news, according to the Harris Poll.

And it’s not just young people: 82% of Gen Z, 78% of Millennials, 72% of Gen X and 44% of Boomers and older have used social media for news.

Nor is it partisan: 67% of Democrats, 66% of Republicans and 66% of Independents have used social media for news.

Yet everyone isn’t seeing the same social media. What makes the situation even more challenging is that people live in their own news bubbles – and their own brand bubbles, too.

In the News: Social Media Platforms’ Trust and Safety Struggles

Social media CEOs from Meta, TikTok, X, Snap and Discord were in the hot seat last week for a contentious Senate Judiciary hearing about online child safety. The CEOs tried to highlight the resources their companies are directing towards monitoring and prevention, but public trust remains low.

While backlash against tech companies for their struggles on child safety comes from both sides of the aisle, the criticism around tech companies’ content moderation policies is increasingly partisan. Meta is now the poster child for what we call the “Crisis L,” a new risk pattern in which a politically driven crisis causes major reputation damage to a company with no evidence of recovery.

In 2019, after the Cambridge Analytica scandal, Meta’s reputation score dropped from the mid-70s to 58.3, into the Poor tier, and it still sits at 59.7 as of 2023. Meta is now the seventh most polarized company on the Axios Harris 100 with a 12.7-point gap between Democrat and Republican scores.

Brands cannot expect reputation recovery when half the country feels alienated from them politically.

Mark Your Calendar: February Risk & Rep Webinar

In addition to our biweekly newsletters, stay tuned for our monthly webinar series: 30-minute deep dives for communication leaders into key topics from employee activists to misinformation to geopolitics.

To RSVP to our first webinar on Thursday, February 22, 12:00-12:30 pm EST, email Alexis Williams. 

ICYMI: Risk and Reputation Unit in the News

• Bloomberg: TV News Networks Are Counting on a Big Election Year. But Viewers Are Tired

By

Stagwell’s Risk and Reputation Unit

Live from CES: When Should Brands Speak Out?

The pendulum has swung back around. Five years ago, brands were encouraged to speak out a lot, but now C-suites are asking whether they should retrench and stay out of politics.

Ray Day and John Gerzema from the Risk and Reputation Unit were at CES 2024 talking to CCOs about how companies should navigate the political cycle, stick to their values and avoid dividing their audience. Watch their Content Studio interview for their advice.

Toxic Words and Acronyms

Words matter and today acronyms are the main troublemakers. That’s according to the Harris Poll’s first-of-its-kind assessment of the most commonly used words in business and not what they mean, but how they’re interpreted. Highlights from the results, which were featured in Axios Communicators:

• 49% of Americans find “ESG” a divisive term
• 38% find “DEI” divisive
• ESG is nearly twice as polarizing a term as “sustainability”
• The top three most divisive terms were “cancel culture” (78%), “woke” (66%) and “underrepresented” (62%)

The key takeaway: Businesses should remain committed to diversity efforts, which other Harris Poll data shows commands overwhelming support – but avoid the acronyms, which have become overly politicized.

Reputation Case Study: Boeing’s Latest Mishap

Stagwell CEO Mark Penn’s Harvard Business Review piece last month dove into the increasing severity of corporate crises that are centered on politics rather than competence or governance issues. That article featured Boeing as a company that successfully navigated the Crisis U: its reputation took a hit after multiple 737 Max crashes, but it recovered within 2-3 years by proving its core competency. Now after the terrifying 737 Max 9 incident earlier this month, Boeing will have to win back people’s trust all over again. 

Mark Your Calendar: February Risk & Rep Webinar

The Risk and Reputation Unit will be releasing a steady stream of content throughout 2024 to prepare brands for the contentious election cycle. In addition to our biweekly newsletters, stay tuned for our monthly webinar series: 30-minute deep dives for communication leaders into key topics from employee activists to misinformation to geopolitics.

 To RSVP to our first webinar on Thursday, February 22, 12:00-12:30 pm EST, email Alexis Williams. 

ICYMI: Risk and Reputation Unit in the News

• Mark Penn on NASDAQ: Why 2024 Will Be the Year of Competition
• Mark Penn on “The Friday Reporter”: No Certainty in Politics
• Mark Penn in Barron’s: Political Season Is in Full Swing. Brands Beware