In a US presidential election year with more twists and turns than most in recent memory, many of the issues on the ballot impact business. And keeping politics in the workplace respectful is forefront on managers’ minds as a divided nation prepares for weeks of potentially rancorous discourse.
Ahead of the Democratic National Convention, HBS Working Knowledge gathered insights from Harvard Business School faculty about what’s at stake for companies, and how the election might impact workplaces. They offer an assessment as the race heats up heading towards November.
Vincent Pons: Four ways to undergird democracy
There are several things businesses can do to strengthen democracy. Here are four of them.
- Encourage voter participation by providing employees with paid time off to vote, thereby addressing the barrier created by election days falling on weekdays. Use platforms and services to encourage voter turnout among customers, similar to Facebook’s Election Day notifications or Lyft’s discounted rides to polling stations.
- Support election administration by donating resources such as ballot boxes, office supplies, and snacks to election officials, and encouraging employees to volunteer as poll workers.
- Facilitate political engagement. Look to online platforms that have simplified small contributions to political campaigns and increased the diversity of donors, as well as efforts to encourage employees and customers to run for office by providing resources and information about candidacy requirements and training programs.
- Promote constructive engagement in the workplace. Implement policies that encourage respectful dialogue and acknowledge diverse political views among employees. Provide training and resources to facilitate constructive political discussions, leveraging organizations like Braver Angels and the Constructive Dialogue Institute. Encourage leaders to model humility and openness to different viewpoints, setting a tone that discourages stereotyping and contempt.
Vincent Pons is the Byron Wein Professor of Business Professor in the Business Government, and the International Economy Unit.
Elisabeth Kempf: Political views shape economic outlook
Political views influence the perception of economic reality among finance professionals.
In a study linking credit rating analysts to party affiliations from voter records, we discovered that professional credit analysts exhibit a sizable partisan gap in their economic outlook, with roughly two-thirds the size of the gap observed among households. This bias affects analysts’ decision to upgrade or downgrade corporate credit ratings, directly affecting the cost of capital of the firms they assess.
“There are good reasons to expect that partisanship will continue to cloud economic judgment around the 2024 election.”
It’s not just credit analysts. Similar patterns have been documented among professional asset managers, loan officers, and top US executives. There are good reasons to expect that partisanship will continue to cloud economic judgment around the 2024 election.
For managers and finance professionals, these insights highlight two important aspects of operating a business today:
- In a polarized political environment, the ability to recognize and mitigate partisan biases will be essential for finance professionals striving to make well-informed financial decisions.
- Political homogeneity creates potential risks in the workplace.
When decision-makers share the same political views, they risk creating echo chambers that reinforce partisan biases, potentially leading to misguided resource allocation. Given the trend toward more politically similar leadership teams that we observe in the data, these concerns are particularly relevant this election season.
Elisabeth Kempf is the Jaime and Raquel Gilinski Associate Professor of Business Administration in the Finance Unit.
Sandra Sucher: Dust off that COVID playbook
After the June 27 debate between President Joe Biden and former President Donald Trump, 64 percent of 1,024 US workers surveyed reported suffering—or seeing others suffer—poor treatment at work for their political views, according to research by SHRM.
“Among those with strongly-held views about societal issues, 20 percent would not be willing to work with someone with which they disagree.”
This has consequences. Uncivil workplaces lead employees to be three times more likely to be dissatisfied with their jobs and twice as likely to quit. There is not only more conversation and division about previously taboo political subjects, but also growing animosity toward people with different views.
Among those with strongly-held views about societal issues, 20 percent would not be willing to work with someone with which they disagree, the 2023 Edelman Trust Barometer found. Another 30 percent would not offer help to those they disagree with if needed.
Flip that data and you may see it differently: eight in 10 people with strongly held views would be willing to work with someone they disagree with. Seven in 10 would offer help if needed.
This harkens back to the COVID-19 pandemic, when business emerged as the most trusted actor in society—both competent and ethical—versus government, NGOs, and the media.
Here are five lessons that might carry over to today’s fraught time.
- People feel threatened. Face that reality head on. Mercifully, we are not talking about life-and-death due to a raging pandemic. Still, identity issues cut so deep that it can feel that way. Data suggests that this is not just in people’s heads. Real harm is being done, even if it is unintentional.
- Come together as a leadership team. Craft a strategy. Decide on an approach to political speech in the workplace—now. Discussion is both widespread and inevitable as the election process heats up. To prepare, game out scenarios and determine how you would manage them. The reality, of course, will be different. But you will have a playbook to build on.
- Build community. Reinforce the culture you want to promote and protect. Your values statement likely includes respect for the rights and dignity of others, belief in the value of difference, and a need to constructively engage in the face of disagreement. Living up to those values does not require opening the floodgates to partisan politics and hot-button issues. Instead, such statements remind people that community matters—and that civility and constructive engagement are both possible and expected.
- Set rules of engagement and hold people accountable. Company norms against disruption and in favor of a civil work environment are essential. High-performing organizations need ground rules so that people who do not follow them are legitimately held to account.
- Prepare your managers for the crucial role they will play in helping teams work well together during challenging times. Coach. Outline strategies to address viewpoint bullying and cancel culture incidents. Forgive. Give second chances. This is hard work—and great training in leadership.
Leaders regularly reach back to the pandemic when asked about a time when they believe they managed trust well. Once the dust settles on this election season, I believe leaders will report new lessons on the art of building trust during a time when it looks remarkably difficult.
Sandra J. Sucher is the MBA Class of 1966 Professor of Management Practice in the General Management Unit.
Marco Tabellini: What to know about immigration
Why are people worried about immigrants?
First, there is an economic argument: even though immigration is beneficial for the economy and increases growth and innovation, people are concerned about immigrants’ competition for jobs and resources.
Second, there is a cultural argument: some people view immigrants as a threat to national identity and culture, and worry that immigrants do not assimilate.
1. A complete ban on immigration would be a major mistake. At the same time, a drastic and sudden reduction in border restrictions would be neither politically feasible nor economically desirable. Such a radical approach would reverse policy, resulting in even stricter immigration restrictions—with potential negative consequences for the economy.
The US government and business leaders should instead seek a coordinated approach to design an open, but flexible immigration policy.
The limits to immigration should be tied to labor market conditions—accepting more immigrants when labor markets are tighter and in sectors where labor demand is higher, and protecting US workers during recessions.
2. Immigrants—of all skills—would help the US economy. Today, the US economy would benefit from more high-skilled immigrants. However, it would benefit both firms and consumers to increase the cap on unskilled immigrants in specific industries such as hospitality, nursing homes, and agriculture. Here, foreign-born workers can work in jobs that native-born workers are reluctant to take.
Both the government and business leaders can consider additional actions. They can implement information campaigns stressing the contributions of immigrants to the society in a variety of domains. For instance, many sport champions are either naturalized immigrants or have foreign-born parents.
3. Showcase success with a multigenerational perspective. Likewise, many successful entrepreneurs were born abroad or have foreign-born parents. Stressing these and similar examples can help showcase the advantages of a multicultural and diverse society.
Information campaigns can be combined with policies aimed at fostering the integration of foreign-born individuals, favoring their entry in the society and developing inclusive corporate culture.
When thinking about immigration policy, it is key to adopt a “multi-generational” perspective. Given the long-term contributions of immigrants and their children to the economy, immigration policy should be viewed as a way to unlock new opportunities for receiving countries and their populations for decades to come.
Marco Tabellini is an assistant professor in the Business, Government, and International Economy Unit.
Rosabeth Moss Kanter: Climate policy direction is vital
Government policies and incentives make a difference in whether global warming and its fallout are contained. A growing number of climate solution startups count on government spending to give their customers purchasing power and a reason to buy.
State and local leaders count on the federal government for investments in vital infrastructure that keeps the economy—and goods and services—moving, including roads, bridges, ports, and freight trains.
Businesses that want employees to return to the office know that commute times can depend on potholes and public buses. Traffic congestion and fossil fuel emissions affect children’s health, if air pollution is high. These are among the reasons for business leaders to care about infrastructure and climate action.
1. Business should be proactive. The 2024 US presidential election presents a stark contrast on climate issues.
One side is climate-concerned. Vice President Kamala Harris was part of an administration that passed the largest climate combat bill in history, and Governor Tim Walz led Minnesota to declare a goal of zero carbon emissions by 2040. The other side features candidates who want to eliminate the Environmental Protection Agency, remove electric vehicle incentives, and accelerate drilling for oil.
If the pro-climate action side wins the election, that doesn’t settle the matter. Business leaders won’t be able to return to business as usual. Instead, they should seek a seat at the table and join cross-sector coalitions, especially in their headquarters region.
Business voices can help to ensure high priority solutions, manageable finances, feasible timetables, and efficiencies. Business leaders can rally local support for pragmatic actions with immediate as well as longer-term benefits.
This role for business leaders becomes even more important if the no-action side wins. Grassroots support for actions that benefit cities and regions will help creative local leaders move forward even when national or state policies are unfavorable.
2. Quality and safety is crucial for climate adaptation innovation. For industries that supply products and services with innovative approaches to climate adaptation and mitigation, there is another important step. Pay attention to quality and safety.
It takes just one electric vehicle catching on fire, wind turbine blade falling off at an offshore wind farm, or a months-late delivery of the town’s electric school buses to jeopardize consumer support and make your innovations controversial again.
The choice is stark. In a climate-denying administration, this may set back the industry for years, letting global warming continue unchallenged. Under an administration focused on climate adaptation, business leaders could, through US-led innovation, bolster American manufacturing and create thousands of middle-class jobs.
Rosabeth Moss Kanter is the Ernest L. Arbuckle Professor and the founding chair of the Harvard Advanced Leadership Initiative.
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Image: Image by HBSWK with assets from AdobeStock/LanaSham
