The demands of populism on business and the creation of “corporate political obligations”

Navigating Populism: A Study of How German and Swedish Corporations Articulate the Refugee Situation in 2015–2016

“…The first offers an understanding of how corporations navigate contested political issues dominated by populist sentiments. Prior research has shown how populism creates and reinforces polarization between, for example, the “people” and the “elite” or the “people” and “refugees” (Blake et al, 2022; Culpepper, 2021; Feldmann & Morgan, 2022; Hartwell & Devinney, 2022; Kerr et al, 2022; Kinderman, 2021; Nyberg & Murray, 2023). In this way, populism builds on an us-and-them logic that requires a society’s members to take sides: A person is either one of the people or among the privileged elite.…”

“…However, as pointed out by Feldmann and Morgan (2022), the challenge populism poses to corporations varies depending on the context. In some cases, for example, populists can pose a calculable political risk or a genuine uncertainty (Sallai et al, 2023) or, as Hartwell and Devinney (2022) point out, be both pro-business and anti-business. Populism also varies depending on whether populist leaders are members of the government or the opposition.…”

“…On one hand, corporations' risk being associated with the corrupt elite and being held responsible for society's current order. As a result, protectionist policies implemented by populist leaders might disrupt corporations' supply chains (Hartwell & Devinney, 2022). Countries dominated by populism might also make it difficult for outside firms to operate (Blake et al, 2022).…”

“…Blake et al (2022) suggested that firms can use sophisticated strategies to deal with populism, such as navigating the uncertain environment of populist regimes by building relationships with populist leaders. In contexts dominated by populism, corporations have the options to stay out of the public eye, refocus on their core business, fight back, or leave the market (Hartwell & Devinney, 2022). We contribute to existing research on business and populism by exploring how corporations communicate about a contested issue dominated by populist sentiments, namely refugee migration.…”

“…Confronted with populism, corporations cannot respond to a fixed set of principles but are faced with a societal tendency whereby an appeal to the general will of the pure people justifies particular political views. Hartwell and Devinney (2022) suggested that businesses face the possibility that their activities will be considered to undermine the people's will. In this light, research shows that corporations can respond to populist sentiments in various ways, including by withdrawing from the discussion, keeping a low profile, expressing support, cautiously engaging, or actively resisting (Feldmann & Morgan, 2022).…”