Employee activism is on the rise. Here’s why.

“What is the most important thing for a company? Is it the cash flow? Is it the inventory? Nuh-uh. It’s the people.” As fans of the mockumentary “The Office” know all too well, Michael Scott, regional manager of Dunder Mifflin, Scranton, wasn’t right about a lot of things. But I believe he was right to suggest that a talented and motivated workforce is the key ingredient for a successful business.

The leadership at Google seems to agree. Earlier this year, the company decided not to renew a contract with the Department of Defense that involved using artificial intelligence (AI) to interpret video images. The reason for the move? More than 4,000 Google employees had signed a letter protesting the project and demanding that the company create “a clear policy stating that neither Google nor its contractors will ever build warfare technology.”

The letter also stated that the government contract “will irreparably damage Google’s brand and its ability to compete for talent.” By choosing the wishes of their employees over revenue, Google leaders seemed to acknowledge that those reputational and HR risks were real. (Despite that acknowledgement, the company now faces a new internal debate over the development of a search app for China.)

Tight Labor Market + Skills Gap = More Vocal Employees

It is possible that Google employees would have stood up for their principles in any situation. But it is also true that the tight labor market the U.S. is experiencing, and the shortage of workers with science, technology, engineering and math (STEM) skills, have created an environment in which it is easier for workers to speak their minds. When employees know their talents are in demand and they could find a new job relatively easily, taking actions that might upset company leaders becomes less risky.

We’re seeing this play out at other companies, too. Management at both Microsoft and Salesforce have faced demands from employees to cancel contracts with Immigration and Customs Enforcement (ICE) and Customs and Border Protection (CBP), respectively, amid the controversy over the separation of immigrant parents and children at the Mexican border.

Employee Activism Goes Beyond Silicon Valley

Some might argue that employees at technology companies have become more vocal on these issues because Silicon Valley attracts more liberal individuals. This is a valid point, but there is reason to believe “employee activism” is a more widespread phenomenon (although it does appear to be more visible in the tech industry right now).

In 2016, the Public Affairs Council gathered survey data from 92 companies across various sectors, including manufacturing, financial services as well as retailing and wholesale. When asked which stakeholders had influenced their decision-making about getting involved in social issues, 78 percent of the companies cited senior management and 70 percent cited other employees. These figures were significantly higher than those for other stakeholder groups such as customers (51 percent), shareholders (36 percent) and competitor and peer companies (33 percent).

It’s also notable that social activism by CEOs has spread in recent years. From AT&T and Dick’s Sporting Goods to Merck and Goldman Sachs, leaders at a wide range of businesses have spoken out on social issues and weighed in on political controversies. The views of their employees almost certainly played a role in the decisions by these chief executives to become activists. And increased CEO activism could in turn lead to more employee activism. After all, if a company’s leader gets involved in social issues, it can signal to employees that they should voice their opinions, too.

The current wave of employee activism has already spilled over into industries outside of technology. Consulting firms Deloitte and McKinsey & Company, for example, have both come under pressure from employees to end their work with ICE.

The Importance of Internal Communications & Corporate Values

Companies across America now face an economic environment in which white-collar employees, in particular, feel safe to openly disagree with their employer’s decisions. At the same time, the current political climate has created a constant stream of polarizing issues—and each of them is a potential source of disagreement between corporate leaders and their employees.

In this new reality, corporate leaders need strong internal communications processes to hold their organizations together. They won’t always be able to meet employees’ demands, but they have to ensure employees feel heard and know that their input is valued. It’s also crucial that companies make decisions that align with their stated values. Part of the reason why Google’s defense work caused such an uproar internally was that it seemingly flew in the face of the company’s informal motto: “Don’t be evil.”

Employee activism is just the latest in a long line of challenges for those tasked with upholding corporate reputation. But it deserves special attention. Because the most important thing for a company are its people.

Employee activism is on the rise. Here’s why.

“What is the most important thing for a company? Is it the cash flow? Is it the inventory? Nuh-uh. It’s the people.” As fans of the mockumentary “The Office” know all too well, Michael Scott, regional manager of Dunder Mifflin, Scranton, wasn’t right about a lot of things. But I believe he was right to suggest that a talented and motivated workforce is the key ingredient for a successful business.
The leadership at Google seems to agree. Earlier this year, the company decided not to renew a contract with the Department of Defense that involved using artificial intelligence (AI) to interpret video images. The reason for the move? More than 4,000 Google employees had signed a letter protesting the project and …

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