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More companies pause political donations following Capitol riots

In this article:
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Yahoo Finance’s Brian Cheung and Anthony D’Angelo, Professor of Public Relations at Syracuse University, discuss companies pulling back on political donations after the Capitol riots.

Video Transcript

BRIAN CHEUNG: Well, after instructing rally attenders last Wednesday to head to the Capitol, President Donald Trump told reporters today that what he thought he said was, quote "totally appropriate." But obviously, companies haven't seen it that way. There have been a number of big names that have cut business ties with the President, the latest being the PGA Championship, which rescheduled its tournament that was set to take place at Trump Bedminster Golf Course.

He was saying outright that it would be detrimental to the PGA America brand. So here to break down the PR fallout is Anthony D'Angelo. He is a professor of public relations at Syracuse University. And I want to start off with the big question, which is, of course, if these companies are trying to save face in the heat of the news cycle, how do we know that this is not all just temporary right now?

ANTHONY D'ANGELO: Hello, Brian, thank you for having me. The way that we know is how they behave. Right now, based on what happened at the Capitol last Wednesday, I think that corporations-- and all kinds of organizations and groups around the world-- saw in the most dramatic fashion that perhaps we can imagine what happens when there is chaos. Right?

And the only way for an organization to navigate this kind of chaotic and potentially very dangerous political and social environment is to know what its purpose is. And corporations as they were-- as was recommended by the Business Roundtable last year, they serve a variety of stakeholders. And they have to know what they're all about.

So they have to demonstrate their purpose and their principles. And that's not by what they say, it's what they do. And right now they are demonstrating what they do by the way that they're investing or not investing. And the way that some of them are very sharply disassociating themselves from Donald Trump.

BRIAN CHEUNG: Now, there are many ways that companies could do this. Obviously there is a difference between, let's say, coming out with a statement denouncing the attacks and then trying to pull back on the political contribution policies that they've had. Which we've seen at a number of big banks, for example.

How do you think different companies are weighing what is the proper action to take here? For a lot of companies that, let's say, x amount of years ago, were really more hesitant to try to step into the political limelight.

ANTHONY D'ANGELO: Yes. I think what recent years have showed us is that companies stakeholders now-- customers, investors, employees-- actually expect companies to weigh in on social and political issues. Is this tricky territory? Absolutely it is. But at the same time, you do have to take a stand. There is that expectation.

Companies have the option now to say, do we want to invest in Donald Trump? In brand Trump, if you will. Deutsche Bank obviously came out with a statement that they're not going to lend to him anymore. The PGA, as you mentioned, has pulled back the PGA Association Championship.

So they can decline-- they can make a statement, they can decline to invest and to associate. And they will demonstrate their commitment through continued behavior. Andrew Ross Sorkin said a couple of days ago that some companies are making temporary defense moves. And it remains to be seen what happens let's say, six months from now, Sorkin noted.

Are companies going to go back and try to curry favor with some of the legislators who were supporting Trump in questioning the election results? Or are they going to do something else? One thing about the current media environment-- social media, especially-- is it's incredibly transparent. And we'll be able to see how companies react, and we're all under this glaring spotlight.

BRIAN CHEUNG: And then, just kind of looking at the picture, you said that maybe the next six months will be a big tell for how these companies truly feel about the situation. But one problem is, we don't know what type of political events will be happening six months from now. And if you look backwards, it seems like maybe the Black Lives Matter movement-- where a lot of companies were very quick to try to, for example, support that movement-- may have been a bridge for them to be a little bit more active in this situation as well.

Do you think that this pattern is going to be a running theme for corporate activism, if you will, in the future?

ANTHONY D'ANGELO: Yes, I do. If you look at some of the studies in my industry, for example, Richard Edelman of Edelman, the largest independently held agency. He does an annual research project called the Trust Barometer. And the indications from that are that this is very much a trend. It's not going away.

I can tell you my students, both graduate and undergraduate, make decisions about the employers that they want to join based on their sense of corporate purpose. So it's really a decision of who you want to align with. And I think that will be an increasingly important criterion.

I'm not in any way discounting, by the way, the profit motive that companies had. They have to think about how their customers will react. How their investors will react. And again, how their employees react.

And factor that into, what are we really here to do? What is our fundamental purpose? And what are our fundamental principles? And are we going to live by those? I think that's going to be the important tell going forward for corporations.

BRIAN CHEUNG: All right, Anthony D'Angelo Professor at Syracuse University, which is my alma mater by the way, so go Orange. Thanks for joining us today. Thank you, and go Orange.