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Monday, February 4, 2019

Strategic CSR - Google

The article in the first url below shows how employees with leverage are asking increasingly more of their employers. The article focuses on the recent activism of Google's employees:
"It was a busy fall for Google workers speaking out against their employer. On Nov. 27, a group of full-time employees and contractors were campaigning to extend new policy changes for handling sexual harassment allegations to temporary and contract workers. … The same day, workers made public a petition protesting exploratory plans to build a search engine that complies with China's online censorship regime. Earlier in the month, 20,000 Google workers walked off the job worldwide in a widely watched protest over how the company handles sexual misconduct claims, following a bombshell New York Times story about Google's management of past allegations. "
The article presents such efforts as the new face of employee activism:
"The walkout was repeatedly called a 'watershed moment,' one that was said to represent a significant development in the labor-employer relationship and a new pressure point for tech giants facing a world increasingly distrusting of their businesses."
In particular:
"What's different about the efforts of these employees … is that they're not merely pushing for traditional labor issues, such as higher wages or better benefits. Instead, some are publicly questioning their employers' business decisions, opposing government contracts or bringing up broader moral questions about workplace policies, such as the inclusion of contract workers in an increasingly gig economy and the ethical implications of paying executives millions of dollars following allegations of sexual misconduct."
Although there is no reason why employees should not have the same leverage in any organization, it appears that employees in Silicon Valley feel more secure in their jobs (or more passionate about their beliefs) to risk alienating their employers. And, at companies like, the demands are leading to structural changes:
"[Recently] Salesforce announced a 'chief ethical and humane use officer' whose job will be 'to develop a strategic framework for the ethical and humane use of technology across Salesforce,' according to a news release. Back in June, more than 650 Salesforce employees signed a petition over the software company's contracts with the U.S. Customers and Border Protection Agency, according to a Bloomberg report; Salesforce CEO Marc Benioff has also been critical of Facebook's addictive qualities, comparing the social media giant to cigarettes."
What I found particularly interesting, however, is that employees seem to be differentiating between societal problems that are related to the firm's expertize and those that are completely unrelated:
"A recent survey of 1,000 workers by MetLife, for instance, found that 52 percent expect employers to help solve societal issues even if they are not central to the company's business, up from 41 percent a year ago. Seventy percent said companies should work to address society's challenges, up from 63 percent last year."
There are two aspects of this phenomenon from a strategic CSR perspective. On the one hand, this is not very sensible from an allocation of resources perspective. It does not make much sense to ask a firm to solve a problem in which it has little or no expertize., for example, knows how to write software; it knows little about solving homelessness, yet its CEO, Marc Benioff, has taken a high profile stand on this issue, both in lobbying San Francisco to pass legislation and publicly arguing with other CEOs, such as Jack Dorsey of Twitter, who take a different position (e.g., see here).
On the other hand, however, if a key stakeholder group truly values action by a firm, then it is in the firm's interests to respond to these needs. The only question then is, do these stakeholders truly care about the cause (rather than merely saying they care)? For example, if the firm reduced wages in order to address the particular problem, would employees still support it? Or, perhaps more likely, if the firm took away some perks in order to do so, would that be OK? In order for any action to make sense for a firm, it has to be supported meaningfully by a subset of stakeholders. If no one is willing to support it, then clearly it is a waste of the firm's resources to address it. At Google, there is a limit to the activism, at least from the perspective of CEO, Sundar Pichai:
"On the same day as the walkout, Pichai spoke at a New York Times conference and said 'there's anger and frustration within the company. We all feel it. I feel it, too. At Google, we set a very, very high bar, and we clearly didn't live up to our expectations.' Yet while Google may be a company that has 'given employees a lot of voice,' he said, 'we don't run the company by referendum.'"
The article in the second url below reports what it says is "the first time that tech employees have led their own shareholder proposal":
"At Amazon, more than a dozen employees who had received stock grants recently exercised their rights as shareholders. In late November and early December, they filed identical shareholder petitions asking the e-commerce giant to release a comprehensive plan addressing climate change."
Take care
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How tech workers are fueling a new employee activism movement
By Jena McGregor
December 13, 2018
The Washington Post
Workers Got Stock. Then They Took Action
By Kate Conger
December 17, 2018
The New York Times
Late Edition – Final