Disney is a great example of how weighing into politics can potentially damage a company.
A for-profit primarily exists to enrich its shareholders.
For most companies, customers run across the entire political spectrum. Taking stances on political issues risks alienating a percentage of paying customers, hurting overall sales and adversely impacting shareholders.
If shareholders say, “we don’t care about the money, this issue is more important to us then some lost sales,” then companies should actively pursue goals preferred by shareholders.
Chapek’s primary job is to enrich shareholders. But this does not mean Disney shareholders don’t have other objectives that are important to them.
Did Chapek engage with a majority of shareholders before taking his public stance or was his pushed into this stance solely by his employees? I genuinely don’t know - Chapek or his team might have discussed this issue privately with major shareholders before issuing the statements that he did. For all I know, a majority of shareholders back Chapek 100% on this.
Remember, the First Amendment protects you from the government. It does not protect you from other consequences of your words.
As Michael Jordan famously said, “Republicans buy sneakers, too.”
Many of us think this is an easy First Amendment victory for Disney, if they decide to go that path.
But, win or lose, what financial impact will this have on Disney? Do Disney shareholders think it was wise for Chapek to weigh in on this?
