UltraViolet is pressing AT&T to stop donations to antiabortion politicians
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If the Supreme Court overturns Roe v. Wade in his forthcoming Dobbs decision, at least 13 states would automatically ban abortion using “trigger laws”: state laws that would go into effect soon after the precedent is overturned.
An analysis by the news website Business Insider concluded that AT&T has been among the biggest funders of politicians who put those trigger laws in place. Advocacy organizations such as UltraViolet have drawn attention to AT&T and other companies that give to antiabortion politicians. The groups are asking people to sign petitions and donate money to pressure AT&T, Disney and other major funders of what they call “anti-woman” politicians. Although UltraViolet has not called for a boycott, often advocates boycott companies as a protest of their political activities or business practices.
But companies are powerful political forces. Since they can’t be voted out, they are not easily pressured. As a result, activists often rely on either calling for boycotts or running pressure campaigns aimed at embarrassing the company and hurting its reputation.
In my book “The Cost of Doing Politics,” I show that public attention to companies’ political behavior does change what they do, even if no one stops buying their products. But instead of stopping companies from donating to politicians and political causes, it can push companies to hide — but continue — their support.
To understand which companies cited concerns about public backlash and why, I analyzed reports that publicly traded companies must file annually with the Securities and Exchange Commission called “10-Ks,” after the form used to file them. In each 10-K, companies must cite possible risks to profitability. These reports are intended to ensure investors know what they are getting into. Since investors can sue companies for misrepresenting their risk profiles, these filings offer the best and most complete records of what companies view as potential threats.
Since 10-Ks don’t change much from year to year, I analyzed 18,653 10-Ks from 2018. Here’s what I learned.
You can boycott a company even if you aren’t a regular customer
When activists announce their intentions to boycott a company, others often dismiss them by saying, essentially, “You’ve never shopped there anyway.” That implies that someone can boycott only those companies from which they regularly buy. This isn’t true. Announced boycotts work mainly by bringing unwanted negative attention to a company, regardless of sales. A company called Boot Barn makes this explicit in its 2018 10-K:
… social media platforms provide users with access to such a broad audience that collective action against our stores, such as boycotts, can be more easily organized. If such actions were organized, we could suffer reputational damage as well as physical damage to our stores and merchandise.
So, yes, you can boycott AT&T, even if you get phone service from Verizon.
Some companies are more scared of boycotts than others
Not all companies are equally concerned about negative publicity. Some companies are more visible, more likely to be targeted by activists, or have more to lose than others. Analyzing a subsample of 1,449 filings for which I had demographic information about leadership, I found that large companies and companies led by women are more likely to worry about social media coverage and boycotts. Large companies are more vulnerable because they are more noticeable. Women-led companies often stand out because so few women hold corporate leadership roles; Further, because women are often given leadership positions when companies are doing poorly — a phenomenon known as the “glass cliff” — they may already be under additional scrutiny.
Coca-Cola, one of the UltraViolet companies is pointing to, even says this about risks from political engagement in its 2018 10-K:
In addition, from time to time, we and our executives engage in public policy endeavors …. These engagements in public policy debates can occasionally be the subject of backlash from advocacy groups that have a differing point of view and could result in adverse media and consumer reaction, including product boycotts.
Boycotts do work — but not the way activists want them to
Companies do recognize that public reactions can harm them. That recognition can stop them from donating to politicians or public causes. However, because companies often donate and lobby to support their business interests — and those interests exist despite the negative consequences of public backlash — fear of backlash mainly encourages them to hide, rather than stop, their pursuit of influence.
To better understand this, I examined Federal Election Commission data on PAC contributions; federal lobbying reports from LobbyView, a public database out of MIT; and company characteristics on 1,378 publicly traded companies from 2018, which I got from Orbis, a database of corporate characteristics run by Bureau van Dijk. Doing so, I found that the companies that specifically cite fears about their reputation in their 10-k filings — the companies most likely to fear negative public scrutiny — are also less likely to lobby the federal government or to donate through PACs that would list donor Company names than were companies that did not cite the risk of reputational damage. That’s true even holding constant other characteristics that might matter, such as company size and industry.
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What does this mean for accountability?
If advocates oppose AT&T’s support of politicians who oppose abortion, or any company’s political activity, drawing attention to that support is a first step. But it won’t necessarily be effective in discouraging that support. Advocates may wish to pay attention to the many ways companies can support candidates beyond direct contributions and lobbying.
When companies fear backlash, they aim for untraceable influence. They form groups with such innocuous names as No Philly Grocery Tax, a group funded by soft drink companies to oppose Philadelphia’s proposed 2016 soda tax, or Partnership for America’s Health Care Future, funded by insurance companies and others opposed to Medicare-for-all and similar policies. They take out ads for their policy goals or donate philanthropically to politicians’ pet causes. They lobby in ways that don’t count technically as lobbying. Advocates trying to change companies’ efforts to influence politics may wish to stay alert to these efforts, as well.
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Jane L. Sumner is an assistant professor of political science at the University of Minnesota, Twin Cities, and author of “The Cost of Doing Politics: How Partisanship and Public Opinion Shape Corporate Influence” (Cambridge University Press, 2022).
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