Taking a Stand : Consumer Responses When Companies Get (or Don’t Get) Political

Companies have reflexively abstained from taking public stands on controversial political issues such as the death penalty, abortion, or immigration. In recent years, however, some companies have eschewed this traditional wisdom, fueling a debate over whether consumers prefer companies to abstain or take such political stands. Results from a field experiment and two controlled experiments indicate that consumer responses depend upon how the company describes its relationship to its external environment. For a company that claims to adapt to its environment in pursuit of performance (market-driven intended image), consumers prefer abstention over taking a stand. In contrast, for companies who claim to stay true to a set of internally held values (values-driven intended image), consumers find political abstention to be hypocritical, and purchase less. Extending theory on corporate hypocrisy, we find that perceptions of hypocrisy become stronger for a values-driven company that is unconstrained in its ability to take a stand (high agency). Taken together, the studies confirm the widely-held notion that taking a political stand can be risky, but reveal that for some companies (i.e., values-driven), abstaining from a political stand can also present substantial risk