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2 months ago
Write a short note on confrontational private politics.
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Business and Its Environment
Edition: 7th
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Confrontational campaigns typically focus on a social issue such as the emissions of toxic substances in a particular region, workers' rights in factories in developing countries supplying developed countries, the rights of indigenous peoples in mining areas, animal rights, conflict minerals, rainforest conservation, or predatory lending. The lines of business of a firm determine the scope of the social pressure the firm could face. A mining company may face social pressure over conflict minerals, rainforest conservation, the rights of indigenous peoples, and toxic emissions.
Activists organize corporate and market campaigns to advance the issues on their agendas, and a frequent component of a campaign is a boycott. Some boycotts are more symbolic than real, but many attract media and public attention. There is considerable debate over the effect of boycotts on a firm. However, most firms are concerned about the possibility of a boycott not only because of possible lost sales but also because the public attention, frequently under the scrutiny of the media, could harm their brands as well as their reputations and public images.
The effectiveness of private politics social pressure depends on a variety of factors, four of which are identified here. The first is the social value achieved by causing a potential target to change its practices, as in the mitigation of a negative externality or improvement in the working conditions in suppliers' factories in developing countries. The second is how tough the potential target is, where toughness depends on the cost of changing its practices. The third is how vulnerable a potential target is, where vulnerability can depend on brand equity or reputation that could be harmed by a campaign. The fourth is the extent to which potential targets take into account the social value of a change in their practices when making their decisions; that is, the extent to which they accept social responsibilities. The objective of confrontation is to shine the spotlight of public attention on a firm with the hope that social pressure will be generated and cause the firm to change its practices.
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