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[Davos Recap Video] Conscience and capitalism: probing the edge in times of division

Brands are entering conversations where they once stood back, taking a stand on issues like race, immigration and gender rights. But should they be? Is it authentic? And do they expect to make a difference? Speakers probed the edge during a panel in the Tradeshift Sanctuary at Davos on Wednesday.

Brands should absolutely be standing up for what they believe, said Sarika Garg, Chief Strategy Officer of Tradeshift, but it needs to come from the heart and be backed by action.

“It can’t be a branding or an advertising initiative, it has to be something that goes way deeper. It really is about businesses having a conscience,” she said.

Businesses must step up because there’s a vacuum in moral leadership elsewhere, said Hayley Romer, Publisher and Chief Revenue Officer at The Atlantic. “It used to be filled by politicians or clergy or people running universities, and that’s simply no longer the case,” she said.

Research has shown that 57% of consumers make purchases based at least partly on their beliefs, said Claudia Edelman, founder of We Are All Human Foundation, a nonprofit focused on equality and inclusion.

Brands that don’t take a stand on issues they believe in will suffer, she said. “That train started departing around 10 years ago and if you’re not purpose-led, you’re you’re going to be left behind, you can kiss goodbye to your customers.”

But do brands expect to make a difference or are they posturing? “You have to vote with your business model,” Garg said. She pointed to CVS as an example, which stopped selling cigarettes in 2004. Or Dicks Sporting Goods, which raised its minimum age for gun buyers to 21.

“Sometimes it may be ok to have the backlash, at least you’ve taken a stance,” she said.

Not all activism has to be political. No one would boycott a brand for trying to solve the opioid crisis, Romer said.

Part of being socially conscious is thinking about the impact technologies will have on society, particularly when companies grow powerful, Garg said. Tradeshift, for instance, has a vision to connect all companies in the world to level the playing field in global trade. But she’s conscious that connecting companies could have negative consequences as well, and Tradeshift aims to stay vigilant as it grows. “We’ll take some hard calls and negative consequences if we have to,” she said.

The panelists acknowledge there’s often a level of self-interest at work. Romer spoke with the PR chief of a large company this week who told her they always weigh the cost of silence against the cost of taking a stand.“If the cost of silence will be greater, they jump in,” she said.

Indeed, deciding an advocacy stance is as much the CMOs job today as the CEOs.

“The times in which no news was good news are far gone,” Edelman said.

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