During their strategy off-site, the executives at a global retail organization turn their attention away from the strategic plan to address a thorny issue. A junior employee has started vociferously criticizing, in meetings and on Slack, the organization’s commitment to sustainability objectives. The executives’ conversation has been precipitated by months of behind-the-scenes questioning by this person and others. In fact, senior leaders are concerned that this group is on the verge of speaking up publicly about their disappointment, highlighting what they perceive to be a gap between what the company espouses and what it actually practices. Within the executive team there is a divide: Some want to shut the employee down while others want to invite them into the strategic discussion.
Leadership teams around the world are facing similar challenges about how to engage with employee activism — whether in relation to their organization’s impact on the environment, commitment to diversity, equity and inclusion, stance on the Middle East crisis, supply chain ethics, or the myriad other topics where businesses are seen, by some, to be contributing to problems or to have some influence on the solutions.
Our research conducted over the past decade has focused on “speaking truth to power.” Specifically, we explore “conversational habits” — what gets talked about and what doesn’t, who gets heard and who gets ignored, and the consequences for performance, innovation, ethical conduct, and talent management.
Noticing the rise of employee activism, we decided to quantitatively and qualitatively examine leadership responses to activist voices — why particular choices were made and what happened in the aftermath. As a result, we identified three key tools to help leaders make more-thoughtful decisions rather than simply reacting and leaving themselves open to the negative consequences of ill-considered claims and commitments. These tools include a taxonomy to help you understand your typical response to activism, an ACT IF framework for choosing when to do or say something, and suggestions for how to pause, pay closer attention to what’s happening in the world and what your employees care about, and learn from your successes and failures.
A Taxonomy of Leadership Responses
We’ve observed six common responses to activist issues, ranging from oblivious to proactive. As you read this list, consider various activist issues in your organization — and how your leadership team reacted.
- Nonexistent (“Activism? What activism?”): Leaders are oblivious to activist voices or so distanced that they are unaware of these voices and thus do nothing.
- Suppression (“Expel it before it spreads”): Leaders attempt to quash voices either through directives that certain subjects are not up for discussion or by making it clear (explicitly or implicitly) that if employees speak up they will face negative consequences.
- Facadism (“Let’s just say the right thing”): Leaders respond with positive words but take no meaningful action, either because they never really intend to do anything or because they become distracted by the next hot topic.
- Defensive engagement (“Do what the lawyers say we have to”): Leaders agree to engage on an issue but only up to the point of legal requirement — they do the minimum.
- Dialogic engagement (“Let’s sit down, listen, and learn”): Leaders understand that they don’t know enough about certain issues, are curious to learn more, and take steps to share decision-making — marking a critical shift in the power dynamic.
- Stimulating activism (“Let’s be the activist!”): Leaders identify themselves and their organization as activists. They publicly stand for a particular cause, and they recruit, reward, and retain employee activists.
We’ve found that the first three responses tend to lead to employee silence, arising from fear and cynicism, which hurts performance and retention, so we advise staying away from them. Another key finding of our work is that people in management perceive their responses very differently than others in the organization do. We’ve written about this tendency for senior leaders to overestimate how approachable they are, the quality of their listening, and the degree to which employees feel able to speak out. As a result, they are often taken by surprise when strong feelings on an issue surface, sometimes explosively.
A much-discussed example of this played out at Basecamp in 2021. CEO Jason Fried wrote to employees that there was to be “no more societal and political discussions on our company Basecamp account.” This was met with a backlash, and roughly a third of employees promptly quit. A few days later Fried blogged, “We started with policy changes that felt simple, reasonable, and principled, and it blew things up internally in ways we never anticipated.”
However, we are not implying that leadership teams need to sit down in extensive dialogue or take a stand on every issue. Of course, they don’t and couldn’t — not while sticking to their main business of running a business.
This raises the question of how to choose when to act.
The ACT IF Framework
An organization can respond to employee activism in different ways depending upon the issue and context. In the opening example, we outlined how different executives wanted to respond. Some reacted angrily, pushing for the employee to be reprimanded and cautioned. Others appeared more open, and there was even the suggestion that this activist employee be invited to the next leadership meeting to lead a discussion. Our ACT IF framework describes five key influencing factors that should shape the leadership response. (It can also be used by activists in choosing which actions to take.)
- Authority: How much authority, power, or status do we have in the wider organizational system compared to other stakeholders? And how do we wish to use the authority we have?
- Concern: Is this issue of concern to us or to stakeholders? Do we really know how much stakeholders care about this issue?
- Theory of change: Do we feel we can make a difference? Do we feel we can resist change in the “outside” world, or do we see how we participate and are influenced by it? What role do we believe we can play in influencing change?
- Identity: Do we consider ourselves to be activist? What do we stand for and what don’t we?
- Field: What is happening in the organization/industry/country/world that impacts the action we feel we should take? For example, is this in the news? Are our competitors acting?
Considering these factors together and with employee, customer, supplier, and investor input, you are more likely to make wise decisions. One senior pharmaceutical executive we spoke to lamented over the rushed communication his company sent out after the Hamas attacks in Israel. A speedy response was arguably necessary, but because the management team did no conferring with employees or relevant network groups, it ended up having to release another statement two days later, apologizing for the deep upset its original missive had caused to some, including Palestinian employees, customers, and suppliers. Had they used the ACT IF framework at the start, they may have recognized the concern of these stakeholders and avoided mistakenly believing they had unilateral authority in deciding how to respond. Perhaps they would have talked about how or why they would want to make a difference (identity and theory of change) in the situation rather than being overly influenced by several competitors who “got their statements out before us” (an extremely partial understanding of the field).
Had the management team paused, the executive acknowledged to us, they would have seen that their primary concern was for the company’s employees in the geographic region — their suffering and their immediate needs. The organization’s corporate identity had never previously included taking a stand on political or humanitarian issues generally, but their values were to look after one another and to respect different views, in dialogue.
This brings us to our third suggestion.
Permission to Pause
Many organizations we’ve worked with seem pathologically busy, driven by the need to achieve more with less and meet immediate targets while discounting the longer game of creating sustainable value. A recurring theme in our research is leaders’ wish for “permission to pause” so that they can respond thoughtfully to issues and pay attention to the world more broadly, rather than fixating on the immediate task and “moving fast.”
With this in mind, we asked leaders what advice they’d offer, in hindsight, about responding well to employee activists. From their answers, we drew out four recommendations:
Notice your “baggage” about activists and activism.
Activism is becoming ever more controversial, and leaders often react without appreciating their own and their organization’s biases, assumptions, and emotions about the issue and the employees raising it.
Accept that you almost certainly don’t know how your employees feel about some issues.
That’s because you aren’t as available or as approachable as you think. Every leader has a “power shadow,” which means that they’re told only what others believe they can bear to hear.
Engage employees with genuine curiosity about how others see the world.
This requires leaders to put long-held ideas and beliefs up for debate and to share decision-making duties on any action that should be taken. You won’t be able to satisfy everyone, but you can show that you’ve got a robust, respectful process for figuring out which issues to take a stand on.
Make sure corporate identity, purpose, and activist intentions are discussed and included in your strategic plan.
Not everyone on the management team we referred to at the start of the article connected the debate they’d just had on strategy with their ensuing conversation on activist employees. You won’t be able to predict every issue that will come up — but it will help if you have already had deep conversations with your colleagues about your collective values and how they fit into your strategic goals, rather than having to rush those discussions in moments of crisis.
Employee activism challenges our assumptions about what leaders can and should attend to when running a business — and the extent to which organizations can stand apart from the social, economic, and environmental issues that are part of a noisy public sphere.
Leaders must come to terms with this shift, cede some control, and work with stakeholders to reflect on the case for action — and nonaction. The tools we’ve described help them to do this and to learn, rather than continuing to make the same mistakes.