Public opinion is not enough to hold companies accountable

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While the court of public opinion can be an effective tool to pressure companies to avoid becoming involved in human rights abuses, new research suggests that in some situations this mechanism may be insufficient to align incentives effectively. In particular, the authors found that the American public is less likely to judge companies negatively when they are involved in certain types of abuse, or when they are more distant from the perpetrators, which means that in some situations this may not incentivize companies to adhere to international guidelines. So while companies should certainly pay attention to the public, the authors argue that they should not rely solely on public opinion to guide their decision-making. After all, defending human rights can sometimes come with an advantage in terms of reputation or financial rewards, but this is not always the case. It is the responsibility of leaders to do the right thing anyway.

Despite the known moral and practical shortcomings of relying on a “business case” to justify doing the right thing, many organizations continue to act as if bottom line benefits – rather than ethical concerns – should drive all business decisions. In particular, some leaders have argued that the court of public opinion creates a reputational (and therefore financial) cost to working with governments or business partners who may have committed human rights abuses. These financial incentives are sometimes implicitly treated as a substitute for other mechanisms, such as legal requirements, aimed at ensuring that companies respect human rights.

This argument is based on the idea that customers and other stakeholders will punish companies associated with human rights scandals, and that companies will therefore have a natural incentive either to persuade their partners to stop committing violations and to remedy any harm caused either to avoid entering into or ending relationships. with partners who commit abuse. And that may sound plausible, but our recent research suggests that when it comes to human rights protection, the court of public opinion is not always an effective mechanism for aligning decision-making with legal standards and ethics.

To explore how the public judges different types of involvement in human rights abuses, we asked 2,420 American adults to respond to a series of hypothetical situations, yielding a total of more than 12,000 answers (of course, while American opinions are not necessarily representative of the world situation). sentiment, this analysis still offers substantial insight into one of the world’s largest markets). All of the scenarios we used would be considered unacceptable under the widely recognized UN Guiding Principles on Business and Human Rights, yet we found that 40% of the time, participants in our study believed that the company had not been involved in a human rights violation. What explains this substantial disconnect between people’s perception of a company as being involved in human rights abuses and the actual behavior of that company?

We have designed the what-if scenarios to include a number of different contextual factors that could affect public perceptions, including the type of relationship the company has with the perpetrator, the types of human rights violations in cause, whether the company has exercised due diligence, the size of the company and the industry, and whether the local community condemns the activity. By investigating the extent to which these factors influenced participants’ responses, we were able to explore how the court of public opinion works – and where it may fall short.

People react more strongly when companies have closer relationships with authors.

First, our participants were much less likely to think a company was involved in a breach if its relationship with the breaching entity seemed somewhat distant. For example, people were 7 percentage points less likely to judge a company to be involved in a human rights abuse if the perpetrator was a supplier than if it was an affiliate.

This effect was even more pronounced if the perpetrator was a government entity. Our participants were 10 percentage points less likely to think a company had done something wrong if state forces violated human rights in a way that helped the company, such as violently suppressing protests, only if a company’s subsidiary committed similar offenses – and they were 19 percentage points less likely to consider a company to be involved in human rights abuses if it remains silent while abuses unrelated occur in a country where it operates.

People are more forgiving if companies have done their due diligence.

Then we found that people were more likely to respond positively if a company had attempted to do due diligence – that is, conduct impact assessments, take action to remediate the negative impact and to monitor the effectiveness of these actions – whether they are ultimately successful in preventing abuse. When a company identified a potential abuse and tried to prevent it, people were 15% less likely to judge the company as being involved in a human rights violation than when the company did not. didn’t even try to identify potential abuse (despite the abuse persisting in both cases).

That said, people were 7 percentage points more likely to judge a company as involved in a breach if it identified risks but did not act on the information than if it never sought the information. in the first place. In other words, proactively seeking to identify human rights risks improves public perception, but only if the company makes an effort to remedy the abuses it uncovers.

People react differently to different types of human rights violations.

We have also found that the American public is more susceptible to certain types of abuse. Our participants were more likely to view companies associated with child labor as involved in a human rights violation, while associations with partners who did not pay a living wage, contaminated a community’s land or engaged in discrimination were less likely to be considered involved in an offence. Interestingly, the violent repression of protesters was one of the abuses least likely to trigger perceptions of involvement in a human rights violation (although it clearly violates basic civil and political rights of citizens), and the abuse for which participants were most forgiving was the destruction of a sacred site (again, although this is a clear violation of cultural and indigenous rights).

Company size and industry have minimal impact on people’s perceptions.

While one might expect the public to hold large companies to a higher standard, we found that company size had minimal impact on the responses of participants: a large conglomerate and a small startup -up were judged only slightly differently, despite drastically different resource and resources. structures. Similarly, people made no distinction between companies in sectors with better or worse reputations for protecting human rights. For example, renewable energy companies have been found to be implicated in abuses in the same way as oil extraction companies, despite the starkly different human rights records of these industries.

People expect businesses to meet their own standards, not local standards.

Finally, our participants were not particularly sensitive to local views on what constituted acceptable behavior. Even if participants were told that local communities thought it was acceptable for companies to employ children in certain situations, for example, their judgment changed only modestly.

The court of public opinion relies more on individual reasoning than on reference to law.

After reading and reacting to the hypothetical situations, we asked our participants to explain their reasoning. Their responses indicated that people are far more likely to appeal to their own moral compasses or secular definitions of human rights than to any external benchmark for what constitutes a human rights violation. In fact, only 6% of the time people mentioned legal frameworks such as those provided by the UN, or even the idea of ​​a human rights law, relying instead on their feelings and individual reasoning. And crucially, although people’s own judgments often align with widely established definitions of human rights, this is not always the case.

For example, one respondent judged that a company involved in contaminating a community’s land was not involved in a human rights violation because they felt the incident “didn’t cross any major lines “. Similarly, another said that “the destruction of a sacred site does not involve human rights”, despite the fact that it clearly violates well-established cultural and indigenous rights norms. And even opinions that aligned with legal norms were often not framed as such. As one participant explained, “I think it is morally wrong for companies to use any kind of child labour”, illustrating the role of individual moral positions in people’s opinions of corporate involvement in human rights violations.

Certainly, there is certainly a place for individual reasoning. Especially in a field as complex as human rights, in which the experts themselves continue to debate legal guidelines, it is not a bad idea to consider public opinion alongside established frameworks. In fact, our research shows that public opinion on human rights can sometimes be very demanding of companies. However, it is also important to remember that public opinion is no substitute for internationally accepted standards – and that the court of public opinion can be an inconsistent enforcer of human rights. In particular, the American public is less likely to judge companies negatively when they are involved in certain types of abuse, or when they are more distant from the perpetrators, which means that in some situations it may not push the businesses to adhere to international guidelines. .

As such, leaders must carefully consider the factors that may influence how their organizations will be judged by public opinion. While they certainly need to pay attention to the public, they shouldn’t rely solely on public opinion to guide their decision-making. After all, defending human rights can sometimes come with an advantage in terms of reputation or financial rewards, but this is not always the case. It is the responsibility of leaders to do the right thing anyway.

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