Should Australian corporates speak out more on social issues?

By Jerome Doraisamy|16 June 2020
Sydney

It is critical for businesses and organisations to consider the extent to which they take stands on Black Lives Matter, deaths in custody and myriad other causes.

Since the alleged murder of George Floyd in Minneapolis, American law firms and corporate entities have come out in droves with statements in support of Black Lives Matter and pledging to further the cause of racial equality in the US.

It would not be unfair to observe that firms and corporates in Australia have not been as vocal as their American counterparts about such issues in the last few weeks, with some exceptions. Numerous criminal defence firms, for example, have spoken directly on the issues of Indigenous deaths in custody in Australia.

And whilst our legal profession is represented by the Law Council of Australia, which can and does speak on issues such as Black Lives Matter – as president Pauline Wright did in a recent episode of The Lawyers Weekly Show – it is worth considering whether individuals and institutions in law can be better activists on social issues.

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Moreover, it is worth considering whether corporate counsel can and should encourage, or even demand, that their businesses and organisations speak up more, in the same way that those across the Pacific have done lately.

In answering this question, Governance Institute of Australia CEO Megan Motto said that Australian corporates have always had influence on society and its broader issues, noting that expressions of such influence have been more indirect in years gone by.

“Companies are an integral part of the economic and social fabric of society – they have significant influence on both through the products and services they supply, the supply chains they use, their marketing approach etc,” she told Lawyers Weekly.

“For many organisations, being aware and active on social and community as well as business issues is an important part of who they are, and helps guide the culture they seek to encourage within their organisation while also reflecting the values of their employees, customers, business partners and shareholders.”

There are also direct commercial and business sustainability reasons, Ms Motto continued, why organisations want to connect their brand to a social conscience – “in a war for talent and market share they may wish to position their brand for success”, she noted.

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“Some will acknowledge a topical issue within their organisation in the form of an all-staff email, for example, and others will prefer to send public messages of support via a media release or social media statement,” she outlined.

“Both methods will be most effective if an organisation can outline what they are doing or planning within their own organisation to meaningfully advance the issue. And, if they have a strong message to contribute to the public debate, corporates can certainly be an important force during times of change.”

General counsel, chief legal officers and other governance professionals are “integral” forces within businesses and organisations, Ms Motto proclaimed. As a result, they are in strong positions to raise ideas and key concerns, including advocating on issues deemed important to speak out about publicly.

“Speaking publicly on issues can also create risk, and GCs/CLOs/governance professionals have a key role to play in understanding and managing risk for organisations,” she warned.

“A key part of their role is keeping across current issues and policy matters and [general counsel] will also be critical in considering if current events are likely to impact their organisation’s governance structures, and advise accordingly.

“They can be a strong voice at the leadership table, listening to the ‘employee voice’ and ensuring this is communicated to broader management.”

Should Australian corporates speak out more on social issues?
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