As President-elect Trump shapes his second administration and cabinet, political and policy uncertainty looms. Companies across every industry face pressure from analysts, employees, the press, and suppliers to address the imminent changes.
In this environment, management teams are already inundated with questions about how political shifts will impact their businesses. CEOs, whether they intend to or not, will signal their confidence or concern through earnings guidance or in public appearances at industry events. Given these pressures and unavoidable circumstances, clear, concise, honest communication is essential for maintaining stakeholder confidence and public trust.
For companies in favored industries, the risks may appear minimal. Clearly, the initial reaction among equity market investors was enthusiastic. Why not welcome the potential opportunities a new Administration could unlock?
Exxon CEO Darren Woods did so just days after the election when he was interviewed at the UN’s COP29 in Azerbaijan. Woods doubled down on the positive implications for his fossil fuel businesses and turned attention to Exxon’s greener credentials. To be sure, he and his management have worked hard to promote those operations including $10 bn in carbon capture, hydrogen and biofuel investments. Woods was free to talk his book without alienating pro-fossil fuel stakeholders.
Do all companies need to address the current political climate? Certainly not, though some companies that brands that might be expected to speak out. Ben & Jerry’s, which has long been noted publicly for its progressive political leanings, posted a message to President-elect Trump saying his victory leaves “half the country feeling sadness and shock.”
Other organizations have decided to step back from commenting publicly on political issues. The University of Pennsylvania announced it would comment on “…world events rarely, and only when those events lie within our operational remit.” In the private sector, Basecamp, a project management software provider banned workplace conversations about cultural and political topics in 2020. Patagonia, a leading brand with core values that explicitly endorse environmental issues, made no statements about the 2024 election.
Effective communication around political risk isn’t one-size-fits-all. Employees want to know about job security and business stability, while investors are more likely to ask about long-term strategies and market adaptation. CEOs and communications professionals must be prepared with multiple messaging strategies for each audience that stays true to their brands.
Organizations must develop strategies and language consistent with their brand and customer values. But, as we have seen all too often, companies can stray “off message” when they address political events.
Ultimately, managing political risk means protecting the brand and its reputation. As communications professionals support companies in this mission, our role is clear: we must help management navigate complex narratives and find the right tone and approach to reassure all stakeholders. That needs to happen on a consistent basis, not just every four years.