American consumers are sending a message to the companies they want to do business with: keep the politics out.
Just ask conservative filmmaker Robbie Starbuck. What began with a single X post slamming Tennessee-based Tractor Supply's DEI policy has morphed into a growing national movement that has sparked public outcry and prompted policy changes at John Deere, Harley Davidson, Jack Daniels and Lowe's.
This enthusiasm is New Research The nonprofit 1792 Exchange announced the findings in collaboration with WestGroup Research. Manuel H. Johnson Center for Politics and Economy.
The survey found that roughly 80% of Americans believe corporations are becoming too political.
The Johnson Center, affiliated with Troy University in Troy, Alabama, aims to counter this ideological dominance by educating the next generation of business leaders in free-market principles.
Aline recently spoke with the Johnson Center's executive director. Allen Mendenhall On Starbucks' methods, the need to dispel the myth of corporate omnipotence, and why applying constitutional principles to corporate policy is not “right-wing.”
Careful Adaptation
ALIGN: Robbie Starbuck's critics claim he's motivated by a “right-wing agenda,” but isn't he instead arguing for neutrality and a return to “business as usual”?
Allen Mendenhall: It is hard to believe that faithfully and thoroughly applying the Fourteenth Amendment to the U.S. Constitution is a “right-wing” position, but this is precisely the view some progressive voices give to companies that seek to follow the reasoned rulings in two landmark cases. Students for Fair Admissions v. Harvard University and Students for Fair Admissions v. University of North Carolina.
These decisions, entirely without partisan overtones, determined that race-based affirmative action programs in college admissions violate the Equal Protection Clause of the Fourteenth Amendment. Ultimately, these decisions represent a recalibration of how constitutional principles are interpreted and applied in academic environments. For companies to adjust their practices in response to these decisions is not a political act, but a wise adaptation to evolving legal standards.
Similarly, Starbucks’ position can be seen as advocating a return to a more traditional corporate centrism that emphasizes business fundamentals such as customer satisfaction and shareholder value, rather than pursuing a particular ideological agenda.
Starbuck is not seeking to eliminate existing legal protections, but rather questions how actively corporations should engage in social issues beyond their primary business functions. This is not “right wing.” Rather, Starbuck is advocating for a more focused, less political approach to corporate governance and strategy.
ALIGN: What does it mean that these policies are so easily and quickly abandoned with just a little bit of pressure? Has something changed that would make this pressure more effective than it was before?
Allen MendenhallThe boycott of Bud Light that followed the company's decision to appoint Dylan Mulvaney as its spokesperson was a shattering of ideological structures, revealing the powerful potential of consumers despite the illusion of corporate omnipotence.
The resistance was an important warning: No matter how powerful shareholders are or how aggressive marketers are in pushing controversial policies, consumers, when provoked, can reassert themselves and disrupt the narrative from within. No company wants to be the next Anheuser-Busch, with sales plummeting and being mocked on social media.
Defeat the Hydra
Alignment: The right often thinks of “wokeness” as a centrally controlled monolith. Recent Postsyou point out that it's more accurate to describe it as a “loose coalition.” Why is this more dangerous, and why is it important that we avoid naively understanding the forces on the right that are forcing ESG on us?
Allen Mendenhall: The word I used in the first draft was “concatenate,” but the great guy who edited the piece, Mike Szabo, wisely removed the word to improve readability. Still, it's a perfect word.
If ESG were Goliath, we could defeat it with slingshots and stones. But ESG is connected to a network of interlocking organisations in different countries. As I said in the article, ESG is not a giant monster, but more of a hydra: a multi-headed beast with many different interests, a loose coalition of academic theorists, corporate opportunists, bankers, investors, lobbyists, non-governmental organisations and misguided well-meaning people all competing to be the most righteous.
ESG is dangerous in part because it involves a subtle form of control that shapes how organizations and individuals understand their social roles and responsibilities. Its power comes not from one centralized authority, but from its ability to spread and integrate across core organizations, government-led investment vehicles, and the administrative state. And yet most people can’t even explain what it is.
Alignment: Given that “wokeness” is a “hydra,” is going after it company by company, as activists like Starbucks do, the most effective strategy? What other avenues should we consider?
Allen MendenhallFirst, embrace truth and courage. When we launched our anti-woke business program for undergraduates at the Manuel H. Johnson Center, we feared backlash. But the national support we received was overwhelming.
CEOs shared with me the inside scoop on ISS and Glass Lewis, and professors expressed interest in creating similar programs at their own institutions.
Even when bank lobbyists threatened my job and career after I spoke at the Alabama State Legislature, the support from across the country emboldened me. Though I felt isolated at first, I soon realized I had a powerful coalition behind me.
This experience demonstrated the need for boldness and integrity, qualities that anyone can embody, regardless of their position.
To drive meaningful change, we need a much larger, holistic strategy that includes legal action, in-depth investigations, tactical boycotts, legislative activity and in-depth education. That means exposing weak politicians who are tied to the core of lobbying. And we need to divert taxpayer dollars from ESG-focused portfolios.
We should think outside the box and seek partnerships with peoples and communities around the world who share our more traditional values, perhaps even with peoples who have not historically been thought of as allies.
With declining birth rates and populations in Europe and other left-leaning countries, it is possible that over time these potentially harmful ideas will naturally decline due to their destructive nature and the dwindling numbers of their adherents.
After all, strength in numbers, even for less influential groups, is the basis for effective resistance – a long-term vision that takes into account demographic changes and ideological evolution over time.
Commonalities
Alignment: The need to bring back American manufacturing has become a bipartisan issue. Is there an effective way for ESG opponents to appeal to potential “bipartisan” allies while avoiding unsolvable ideological battles?
Allen MendenhallManufacturing issues aside, the left and right may find common ground when it comes to ESG. Left-leaning groups frequently protest against companies like BlackRock, but they get little attention from traditional media.
For left-leaning students, I recommend reading the books Woke Capitalism by Carl Rose, Our Lives in Their Portfolios by Brett Christophers, and The Problem of Twelve by John Coates.
While I don't always agree with these authors, we share the same view on the underlying issues. It's frustrating to see poorly informed journalists criticizing the anti-ESG movement from a left-wing perspective, especially when they don't fully understand the issues but are being manipulated by those who do.
Some on the left are ready to abandon their traditional focus on class and poverty to embrace the wealth, status and influence that come with a full commitment to environmentalism and identity politics.
Alignment: To what extent do you think local businesses are part of the solution? Could the rise of ESG spur entrepreneurship?
Allen Mendenhall: I will withdraw my savings from Truist and use my local community bank that does not promote ESG and has values that are at odds with mine. I would hesitate to encourage people to withdraw their savings en masse from the big banks because runs on banks don't help anyone.
But I don't think that localism for the sake of localism is necessarily beneficial from an economic perspective. I think an entrepreneurial approach is much better and will lead to exciting changes across investment and financial services. We're already seeing that change.
Push back
Alignment: What can subscribers do to combat ESG?
Allen Mendenhall: People of different economic means will have to tackle the ESG fight in different ways: those who are just getting by can focus on only buying products from companies that align with their values, or are at least politically neutral.
But those with more money can have more influence in the investment arena. To have a stronger say in decisions regarding shareholder proposals during proxy season, more companies need to acquire significant stakes in public companies.
While I am generally cautious about turning to politics for solutions, I am seeing great strides from state treasurers and lawmakers who are recognizing the impact of ESG and are beginning to push back by divesting from asset managers that make ESG a priority and ensuring that public dollars are not wasted on investments that prioritize ideological values over financial profits.
It may seem counterintuitive that fund managers and their clients would prefer poorly performing ESG investments and business strategies over more profitable options, but a recent study by the Hoover Institution found that younger investors – who are often more financially precarious than their parents were at the same age – are willing to sacrifice 11% to 15% of their savings to support ESG-led initiatives related to social issues and the environment.
It will be interesting to watch how the priorities of these young investors change, just as the counterculture kids of 1968 were largely replaced by the Reagan-voting yuppies of the 1980s.
In contrast, Baby Boomers prefer more traditional investment strategies and are resistant to taking financial losses on their retirement savings.
If young investors are truly passionate about issues such as net-zero emissions and gender diversity, why not invest directly in charities and causes working towards those aims? Or perhaps aim to maximise investment returns to generate more resources to support their favourite political and social agendas?
