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Last year, Unilever pushed back against hate speech and other bad online behavior by leveraging its advertising dollars against Facebook and other social media platforms. However, algorithm-driven ad buys only address part of the challenge for brand reputation. Recent developments in employee activism indicate that public concern over the U.S. president’s immigration policies is rippling out to encompass advertising and public relations firms, too.

Ad agencies and public relations firms feel the 'Wayfair Effect'

Employee activism is growing in force. As an outcome of increasing public concern over the treatment of immigrants during the Donald Trump administration, workers are beginning to question the business ties their employers have formed with federal agencies and vendors involved in providing immigration services.

One recent incident involved the home furnishings company Wayfair, whose employees literally took to the streets after seeing their concerns over immigration policy handled dismissively by executives.

The wave of activism has now grown to include advertising and public relations agencies. In one high-profile episode earlier this year, reports surfaced that employees at Edelman refused to work on the firm’s new business with Geo Group, a for-profit prison company frequently associated with reports of inhumane treatment at immigrant detention facilities. Shortly after, Edelman severed the relationship with Geo.

Another leading public relations firm, Ogilvy, demonstrates the potential risk of failing to address employee concerns. Faced with similar employee concerns over a contract with U.S. Customs and Border Protection, Ogilvy stood by its client during a closed-door meeting with employees on July 7. Weeks later, employees continued to voice their concerns to the media, and the issue is still simmering.

The trade publication DigiDay summed up the Ogilvy situation in a wider context on July 29:

“The internal turmoil at Ogilvy over its contract with the Customs and Border Protection has meant new questions for agencies—and is turning into a test of how the business is run," wrote Kristina Monllos of DigiDay. "Agencies are dealing with a new market reality that affects agency culture, employees and how agencies do business.”

A CPG giant under the microscope

Unilever has long had a relationship with Ogilvy, and so far, the firm’s internal conflicts have not appeared to have an impact on its business with Unilever. However, others are beginning to notice.

One example is the well-known brand reputation activist Shannon Coulter. Last week, Coulter drew attention to Unilever as a client of the agency Vayner Media, which has been taking heat for its business with the popular fitness companies Equinox and SoulCycle. SoulCycle and Vayner were caught in the crossfire when news surfaced that one of the fitness company’s investors, Stephen Ross, recently hosted a high-dollar fund raiser for President Trump. (The luxury health club company, Equinox, has also been under the same scrutiny.)

Coulter highlighted the connection in a tweet dated August 7. She wrote:

“Given that SoulCycle's chair Stephen M. Ross is an investor in your @VaynerMedia are you concerned the consumer backlash he's facing over a Trump fundraiser may come to the att'n of big Vayner clients like Johnson & Johnson, Unilever or Chase?”

Unilever puts the business community on notice

Unilever has already positioned itself for a proactive response. Last year’s notice to social media companies over both hate speech and “fake news” was just the beginning. This year, Unilever is taking on advertising agencies and public relations firms.

The company built its case in a speech this summer at the 2019 Cannes Lions International Festival of Creativity by Unilever CEO Alan Jope, who took aim at a practice he dubbed “woke-washing.”

Also known as “purpose-washing,” woke-washing refers to brands that adopt advertising campaigns that make grand claims about improving the world, but fail to take any meaningful action. Interpreted more generally, purpose-washing may also refer to campaigns that gloss over controversial aspects of a brand’s activities.

In his remarks, Jope drew a picture of an industry at a crossroads:

"Woke-washing is beginning to infect our industry," he said. "It’s polluting purpose. It’s putting in peril the very thing which offers us the opportunity to help tackle many of the world’s issues. What’s more, it threatens to further destroy trust in our industry, when it’s already in short supply.”

Unilever reduced its reliance on external ad agencies and PR firms several years ago and began taking more of this work in-house as a cost-cutting move. Recent events also vindicate that strategy as a way to limit the company's exposure to potentially toxic business relationships. In the context of rising employee activism, additional changes in Unilever's relationships with advertising agencies and public relations firms could be in the works.

Unilever hinted as much in June. In a press release describing the Cannes remarks, Unilever stressed that Jope “called on agencies to reject campaign briefs from brands that don’t ‘walk the talk’ on purpose.” Somewhat ominously, Jope also promised that “agencies with a track record of purpose-washing won’t work on Unilever brands.”

Global corporations like Unilever have long formed their relationships with professional services firms including those in communications, advertising, and even legal based on their reputation and quality of work delivered to other clients, in other industries, regardless of how some (or even many) citizens feel about the outcome of those relationships. For example, an apparel company would engage with a public relations firm that has done controversial work on behalf of an energy company that had a spotty record on human rights.

But those types of relationships are now becoming examined more closely, as we have seen with what has been going on with Edelman and Oglivy. Will we see a future where a company shies away from future engagements with a public relations agency, advertising agency or law firm due to prior projects that could push employees to speak out publicly against such a relationship? We cannot say for certain, but we’re entering a brave new world—and Unilever may just be a trailblazer.

Join us at 3BL Forum: Brands Taking Stands – What’s Next, at MGM National Harbor, just outside Washington, D.C., on October 29-30, 2019. The two-day event will continue our newly established tradition of bringing corporate leaders together on a fast-paced main stage, keenly focused on the ‘why’ and ‘how’ behind their thinking as we navigate a rapidly changing business environment. Receive a 25 percent discount using this code PUNDIT2019AUGUST when you register here during the month of August, 2019.

Image credit: Kit Suman/Unsplash

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Employee Activism Confronts PR Firms on Immigration Policy
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New developments in employee activism show how public concern over U.S. immigration policies has had a ripple effect on both advertising and PR firms.
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