As Authoritarianism Surges, Corporations Have A Responsibility To Counter It
Dr. Alan Waring is a retired risk analyst and former Visiting Professor, now Adjunct Professor, at CERIDES (Centre for Risk and Decision Sciences) at the European University Cyprus.
Authoritarianism is not only a characteristic of the radical right but also of some business organizations and especially their leaders. Moreover, there is ample evidence that some corporate organizations knowingly support radical-right ideas and causes. In some cases, corporations (either directly, or via wealthy owners, or via foundations or other intermediaries) provide vast amounts of funding for radical-right ‘research’, ‘education’, publications, websites, political lobbying, activist support, and general promulgation of radical-right ideology. In the US alone, such ‘dark money’ runs to hundreds of millions of US$ each year.
How well established is the threat and how can corporate support for the radical right be curtailed?
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The Corporate/Radical-Right Axis: An Unhealthy Symbiosis
The success and normalization of radical-right ideology is also a measure of the symbiosis between the political and corporate worlds. According to Kean Birch (2007), Peter Bloom & Carl Rhodes (2016; 2018), and Colin Crouch (2014), the two worlds are synergetic. While many senior executives avoid or reject radical or extreme politics, a significant number do not. Although, in principle, it is neither unlawful nor controversial for mutual lobbying on shared interests, nevertheless, there is an obvious risk of corruption, e.g. the Austrian far-right FPŐ corruption scandal involving Heinz-Christian Strache.
There is also the potential for the advancement of unwholesome political agendas that suit both political and corporate interests, e.g. the Cambridge Analytica abuses of millions of Facebook users leading up to the 2016 Presidential election in the US and the UK Brexit referendum. Cambridge Analytica was created by arch radical-right ideologue and promoter Steve Bannon and bankrolled by Robert Mercer, wealthy CEO of Renaissance Technologies.
Far-right funding links tend to keep a low profile but in recent years have received increasing scrutiny, e.g. T.J. Coles (2019; 2020), Josh Halliday et al (2018), and Tom Keatinge et al (2019). Author Jane Mayer (2016; 2017) described the fusion of mutual interests between the radical right and corporations as the application of “dark money”. These mutual interests and synergies demonstrate how the vast wealth of particular individuals and families, their corporations, and their tax-exempt foundations, support the social and political objectives of the radical right.
A survey of 22 such US funds in Waring (2021, pages 70-74) put the combined declared annual revenues of those surveyed at US$532m. The combined fund values of the largest five came to nearly US$4bn. With the estimated total number of US funds for radical-right causes exceeding 100, it suggests a conservative figure for their combined fund values of US$10bn and combined annual revenues of at least US$1.3bn. Prominent among wealthy donors are Robert Shillman (CEO of Cognex), Robert Mercer, and Nina Rosenwald (the Sears, Roebuck & Co heiress). The Publix heiress, Julie Jenkins Fancelli, reportedly made a large donation (along with Alex Jones, the high-profile far-right provocateur) to facilitate the radical-right rally in Washington DC on January 6, 2021, from which many attendees proceeded to attack the Capitol building. Corporate supporters were also allegedly involved in that attack, for example, the arrest of the CEO of Cogensia.
If radical-right politicians become stronger, corporate donors with radical-right sympathies may also become emboldened to act in an authoritarian manner within their own companies, and probably thereby harming employees, external categories, and society as a whole. The authoritarian attitudes and conduct of some corporate bosses are often noticeably similar to those of radical-right political leaders. President Trump was an extreme example of both categories, as a radical-right political leader and a corporation owner. Bloom and Rhodes (2016) were scathing about the genre.
In addition to ideological and financial support, there are also corporate leaders who, for the sake of their own commercial opportunism, aid and abet the radical and far-right. Prominent among these are the Internet and social media platform providers. Some of the largest have been accused of providing extremists, terrorists, and other criminals with unfettered facilities to promote their beliefs and activities, and to spread hatred against ethno-religious and other minorities (e.g. the Chief Rabbi of Britain, Ephraim Mirvis, in identical complaint letters of July 26, 2020 to Jack Dorsey of Twitter and Mark Zuckerberg of Facebook), as well as those rejecting radical-right beliefs. They have also been accused of facilitating the dissemination of false facts and fake news, especially relating to wild radical-right conspiracy theories from QAnon and others. Defenses put forward by such platform providers as Twitter and Facebook, that they are merely free-speech information channels and not publishers, have been widely dismissed as sophistry.
The policy of such companies to only react to public pressure and adverse publicity, instead of proactively and quickly banning such material and account holders, remains a target of legislators, e.g. the current Online Harms Bill in the UK. Only following the use of social media by Trump to fire up supporters, which many believe triggered the insurrectionist mob attack on the Capitol building in Washington DC on January 6, 2021, and the use of such media by the mobsters in situ to video and disseminate their actions, did such companies as Facebook, Instagram, Snapchat, and Twitter suspend Trump’s accounts.
Perhaps they foresaw a likely global tsunami of tough government regulation of Internet and social media platforms in the aftermath of the attempted coup. However, deferring to all the money-making traffic and profits they gain from such radical-right abuses, these companies remain evasive and resistant to self-regulation.
A boycott of Internet platforms, threatened in 2018 by major corporate advertisers unless they cleaned up their policies, and supervision and control of extremist content and hate messaging, began in 2020. Unilever, which annually spends over US$3billion in digital advertising, and numerous other corporate clients exasperated by continuing perceived obduracy by Facebook, in particular, undertook a 1-month advertising boycott of Facebook (and in some cases, other platforms). Such mass action may provide a pointer to one potential strategy for combatting online racism and hate messaging.
Overlaps of Corporate and Radical-Right Authoritarianism
Corporate authoritarianism typically encompasses a range of overbearing, if not dictatorial, stances and bad conduct by some corporate leaders towards customers, employees, contractors, and society in general. While some motivations evidently emerge from pathological or anti-social personalities, other motivations may be simply laziness and avoidance of managerial inconvenience or minimizing adverse impact on revenue (an aspect of greed and/or misplaced competitiveness), or an indignant free-market determination not to recognize rules and limits set by ‘big government’. Some corporate leaders may possess all these motivations.
The psychological study reported in 2016 of problem personalities in work organizations in Australia, and the follow-on study of 261 senior executives reported in 2020, suggests that approximately 20% of CEOs are classifiable as exhibiting clinically elevated psychopathic personality traits. The power attractiveness of boardroom jobs may explain why toxic personalities appear to have a disproportionate presence among corporate leaders.
The prevalence of radical-right world-views in the general population may not be as high as their ‘noisy’ public presence might suggest. Emily Turner-Graham (2019, page 143) estimated on the basis of known memberships and supporter data that in 2018 the total number of UK supporters of the radical right, ranging from the ‘softer’ populist end of the spectrum to the hard extremist end, to be some 1.82 million or 3.8% of the UK electorate of 47.93 million. However, as with anti-social and/or psychopathic traits, those with radical-right proclivities may also be attracted disproportionately to gain powerful positions.
Recognition in both academic and corporate circles that authoritarian corporate organizations and their leaders had become not just an embarrassing anachronism, but also a dysfunctional stumbling block to the survival and continuity of corporations in the 21st century, has arisen relatively recently. By 2010, failures by corporate leaders to recognize, understand, and respond appropriately to such fundamental issues as organizational culture/climate, and power relations and potential abuses of them within their organization, as well as leadership failures, had emerged as a recognized major impediment to corporate success and sustainability. See e.g. Jeffrey Pfeffer (2010; 2018).
Corporate Moral Purpose: Lost and Rediscovered?
Many corporations appear to have ‘lost their way’ in terms of properly understanding their purpose and then enacting it. A radical new paradigm, the “framework for the future of the corporation”, has been proposed by the British Academy (2018) to replace the present dysfunctional one:
“Corporations were originally established with clear public purposes. It is only over the last half century that corporate purpose has become equated solely with profit. This has been damaging for corporations’ role in society, trust in business and the impact that business has had on the environment, inequality and social cohesion. In addition, globalisation and technological advances are exacerbating problems of regulatory lag.” (page 8).
In a similar vein, 181 CEOs of major US corporations at the US Business Roundtable also issued a joint statement in 2019 redefining the purpose of a corporation with a focus on benefitting all stakeholders and not just stockholders. Business press articles e.g. Milken Review have also favored the theme. Since maintaining and increasing inequalities based on indefensible criteria lies at the heart of radical-right ideology, the new model is anathema to the radical right.
Authoritarianism among radical-right politicians and in corporations is essentially the same underlying phenomenon, which projects their shared interests and promotes symbiosis. As noted above, corporate world-views still focus on profit, personal greed, personal gratification, predatory unilateral competition, callous disregard for the classes of people they harm, and a belief that the only stakeholders to be serviced and protected are themselves and corporate shareholders. The ‘new corporation paradigm’ inherently and explicitly rejects all such characteristics of corporate authoritarianism. Increasingly, shareholders will be expecting boards to adopt this model and this implicitly requires boards to curb, if not terminate, any director or CEO whose attitude and conduct smacks of radical-right excess.
Typically, those corporate leaders and executives who support radical-right ideology and objectives will probably not care that their conduct and character are subject to criticism and opprobrium, in whatever context or medium. As proud supporters and true believers, some may even revel in the notoriety and reinforcement of the radical-right cause which their contribution seeks to advance. However, even corporate authoritarians who do not consciously espouse radical-right ideology may find themselves nonetheless increasingly likened to, and categorized as fellow travelers of, the radical-right by virtue of exhibiting similar rhetoric, ideas, and conduct. Either way, they will all become increasingly vulnerable to sanctions and dismissal.
Clearly, the new model for corporations based on broad-based stakeholder fairness and equity (not necessarily equity in shares or asset rights) is totally at odds with authoritarianism. Authoritarian attitudes, amoral calculation, cavalier conduct (especially any with a radical-right character), and corporate donations to radical- or far-right causes, will have no place or acceptance in the new model corporation.
Recent ‘New Model’ Corporate Actions
When authoritarianism infects a corporation, it has potentially damaging effects on a broad range of stakeholders: mistreatment of employees, contractors, customers, the public, environment, public health, etc. as well as democracy overall. In countering such potential, especially in publicly listed corporations, corporate governance rules, anti-discrimination policies, and CSR (corporate social responsibility) have had some effect but much less so in privately owned corporations where Listing Rules have no impact.
In October 2020, the bold public threat by Legal & General, one of the UK’s largest institutional investors, namely to all FTSE 100 and S&P 500 companies to implement the Parker Report recommendations on appointing ethnic minority directors or face retribution, was unprecedented. So too was the walk-out by Glaxo Smith Kline and Credit Suisse directors from a social event when a racist cabaret act opened. The ‘new model corporation‘ epitomizes this sea-change that heralds a potential check on corporate/radical-right symbiosis.
In keeping with the new anti-authoritarian mood signaled by the US Business Roundtable joint statement in 2019, in April 2021 some 700 major US corporations issued statements condemning the voter suppression bill signed off in Georgia state by Governor Brian Kemp. These included CitiGroup, Coca-Cola, Delta Airlines, JPMorgan Chase, Merck, and Microsoft. Voter suppression by radical-right interests is now regarded as an unacceptable assault on the mutual and joint interests of corporations and the communities they serve.
For privately-owned companies, in some cases, laissez-faire leadership, inferior managerial quality, and authoritarian, prejudicial, and discriminatory values may prevail, and radical-right infiltration may already have occurred. However, as with listed corporations and their leaders who fail to behave ethically and responsibly, increasingly these ‘rogues’ too may find themselves being quarantined to an out-group of ‘untouchables’ whose business no one wants. The mood change in corporate boardrooms is that authoritarianism, whether personal or ideological, and whether seeking to encourage ‒ or worse ‒ fund radical-right causes, will no longer be tolerated.
Organizational, Professional and Peer Group Strategies
At an organizational level, a number of strategies are available to counter radical-right insurgency, interference, or manipulation. For corporations, these include formal anti-extremist (including anti-radical right) policies as part of corporate governance and risk management. These policies would include such routine protections as:
(a) Separation of CEO and Chairman/President functions as two separate individuals, so as to prevent a joint Chairman-CEO becoming too powerful, self-serving and beyond effective control if indulging in decisions and conduct damaging to the corporation;
(b) Appointment of fully independent non-executive directors (NEDs) to help steer executive directors away from potentially egregious or damaging decisions and conduct;
(c) Establishing an effective Board Risk Committee (separate from a Board Audit Committee) tasked with ensuring that the Board addresses ‘all significant risks’ to the business, which would include any potential threats arising from ideological sources of whatever kind;
(d) Requiring effective due-diligence background checks (negative or positive vetting, as appropriate) on all staff appointments, staff promotions, contractor appointments, agent appointments, partnering and joint venture contracts, licensing agreements, and proposed mergers or acquisitions;
(e) As an integral part of due-diligence, requiring psychological evaluation for all individuals subject to positive vetting.
The essential requirements of corporate governance and risk management within an organization are well established. Whereas the formal framework for corporate governance and risk management should work to prevent harmful radical ideologies and authoritarianism operating in corporations, and does appear to in general, there are numerous instances of failure. The reasons for such failures lie in a combination in the particular organization of defective formal frameworks and weak and/or toxic leadership. As Clive Smallman has laid out (pages 191-224), the characteristics of positive leadership versus toxic leadership are clear and well known. Ensuring that only positive leaders are appointed is another crucial aspect of due-diligence, and emphasizes the necessity for psychometric and psychological evaluation as well as searching for tell-tale signs of offensive attitudes and conduct.
How fast the ‘new model corporation’ gains traction is likely to hinge on a combination of factors, including enlightened self-interest of corporate leaders. This is especially so in the context of the fragile global economy of the Covid-19 and post-Covid era, the policy positions and codes of ethics of professional and sector/trade bodies, and how rapidly the overall management education and training syllabuses of business schools, universities, and other centers are able to be re-orientated to reflect the new model.
This article is brought to you by the Centre for Analysis of the Radical Right (CARR). Through their research, CARR intends to lead discussions on the development of radical right extremism around the world.