The Power to Make a Difference: the RFRA and Corporate Social Responsibility

by Jan 18, 2016Blog, Business & Humanity, Change, Featured, Social Impact, Strategy0 comments

The recent outcry over Indiana’s Religious Freedom Restoration Act (RFRA) and its potential use to discriminate against the lesbian, gay, bisexual and transgender (LGBT) community has caused a storm that has drawn businesses into a controversial legal and ethical discussion. It has shown that businesses of any size can act in a socially responsible way, and that doing so, far from harming the bottom line, can do great things for a brand.

Stepping Into the Gap

It would be hard to identify two more successful and widely recognized brands than Gap and Levi Strauss & Co. When it comes to social responsibility, they have until recently taken quite different paths. Gap has been outspoken on issues such as equal pay, while Levi Strauss has largely avoided the spotlight of social activism.

Not any more. Following the enactment of the RFRA, leaders of the two clothing giants came together to condemn the law as ‘legalized discrimination’. They attacked the law, while making clear that their businesses were friendly toward the LGBT community.

In an America increasingly polarized between conservative and liberal movements, this might seem like a damaging step for a company’s bottom line, and it shows great responsibility for a large company to step up and make its voice heard.

Businesses of All Sizes

More courageous, and arguably more important, is the stance taken by small businesses in Indiana. Many of them quickly signed up to a group called Open for Service, in which businesses openly state their support for and openness to the LGBT community. The organization went international, attracting over 2,000 members within a few weeks. With stickers in shop windows, a directory of registered businesses and a fund for future social business ventures, it showed that small businesses could make their voice heard, especially by banding together.

This was a much bigger risk for small Indiana businesses, who could have lost income from customers who supported the RFRA. But it raised their profile and brought a statement of inclusiveness into a divided community. It also ensured custom from the movement’s many supporters, just as Gap and Levi Strauss’s stance bought them more loyalty from LGBT customers.

Passionate Purpose

The RFRA remains a controversial issue. Supporters of the act might argue that they are the ones acting out of a sense of social responsibility, protecting religious freedoms based on the values they support. And this brings us to the heart of real social responsibility – acting on a passionate purpose.

Whatever you believe socially responsible behavior looks like, it touches on what is important to you. By stirring the emotions it can draw criticism, but it also galvanizes support. It gives people more reason to care about your business one way or another. Indifference can kill a business just as surely as hatred. Accepting that you will be criticized, and in return making your staff and customers care, will add real energy to your work.

87% of consumers consider a company’s social responsibility to be important. That’s a lot of customers to reach out to.

Using Your Power

We all have the power to make a difference, whether we’re running a huge corporation or starting up a small business. The RFRA, far from showing the danger of businesses taking a social stance, has reminded us that anyone can make a difference in the world. It has been a reminder that being socially responsible, taking a stance and sticking to it, can do a business far more good than harm. And as Indiana Governor Mike Pence rushed to alter the RFRA, it has shown us how much impact that purpose can have.

Being socially responsible makes us better people, and it makes our organizations into better businesses.

Mark Lukens, MBA

Mark Lukens, MBA

Founding Partner at Capatus
Mark Lukens is a founding partner at Capatus and located in the New York office. He leads the Capatus’ Global Talent and Advisory practice. He is also an expert in the firm’s research and nonprofit practice. Lukens has more than 20 years of c-level executive and consulting experience delivering strategies and transformational programs to firms ranging from start-up to Fortune 50. He has worked with clients in Europe, North America, South America, and Asia. Lukens worked extensively in various product and service categories including health care, life sciences, government, nonprofit, technology, and professional services. He also advises clients in other industries including commercial and industrial, retail, logistics and transportation, media and more. Lukens serves on several Nonprofit Boards and is a professor at the State University of New York where he teaches in the School of Business and Economics with a focus on marketing, international management, entrepreneurship, HR, and organizational behavior to name a few. Lukens has a technical background as a MCSE and earned an MBA from Eastern University.
Mark Lukens, MBA


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