The Risk of Polarization
By Randy Lioz
Shortly after the first Covid vaccines were introduced, a food solutions company in Idaho wrestled with the best course of action for its business and employees. While a vaccination mandate was a non-starter, they strongly encouraged vaccination among their employees, bringting in representatives of the local health department to support the push. Several of the company’s managers, so upset by this decision by leadership, decided to quit the business.
It’s difficult to follow the news without registering the various ways in which organizations around the country, especially businesses, are feeling the brunt of our highly polarized society. While controversies at the most public-facing brands, like Anheuser-Busch and Disney, are examples that come to mind readily, there are plenty of more hidden ways in which this trend presents grave risks for companies.
Leadership teams in our largest corporations are now sorting themselves by political leaning, and there’s evidence to suggest that shareholders are reacting quite negatively when executives leave a company over political differences, with the average S&P 1500 company losing $200 million in market cap as a result.
This echoes a larger trend of geographic sorting among the general public in which blue areas are becoming bluer and red areas redder. We’re surrounding ourselves with people who agree with us, and it’s a reflection of the wider disappearance of shared spaces in this country, where we might encounter those with different backgrounds and perspectives.
We’re still interacting with people we disagree with online, but those digital spaces are certifiably toxic, used more to solidify our tribal identities than to understand one another. It’s worsening our crisis of interpersonal trust, which has declined precipitously in the U.S. since the mid-1980s.
The latest cohort of people joining our workplaces has been deeply impacted by this shift in the spaces where we interact, but also several others. Rather than summer jobs, their high school breaks often consist of enrichment programs and starting nonprofits to try to game the hypercompetitive college admissions race.
And when they get to campus they’re being treated like the customers they are, rather than being challenged with a variety of different, and often difficult, ideas. These campuses, especially the most elite — which tend to supply the next generation of organizational leaders — are being used as a new cultural battleground, with pressure from both ends of the political spectrum to limit the speech of those we disagree with.
With their social, academic and work lives moving online, they’re losing out on opportunities to build relationships the old-fashioned way, based on long-term in-person interactions, and especially in the past few years young people are entering the workforce with deficient soft skills like communication. Hiring managers are taking note, complaining that they’ve had to fire members of Gen Z within a month or even a week of hiring them because of these shortcomings, or because they’re too easily offended.
A concurrent shift may be even more profound. Even as most people in the U.S. want to keep politics out of the workplace, the youngest cohort is insisting that their values be reflected in their work, and that their leaders stand up for those values.
A smaller-scale study recently found around 70% of the companies they talked to had experienced negative effects from political and social divides, with nearly half struggling to manage conflict without causing further division. The negative market responses to executive team sorting point to another internal risk from polarization: “organizational monocultures” are toxic for innovation and flexibility.
Polarization brings external risk for businesses as well, particularly from mistrust of our societal institutions, and they should recognize the opportunity they have to help address both. There’s widespread support among both business leaders and their customers to embrace the idea of “corporate civic responsibility” and be more active in bolstering those institutions.
But companies can also help ensure that we keep the shared spaces we still have; most of us still have more friends of different political leanings at work than we do outside of work. Our workplaces bring those diverse voices together around shared goals (a crucial foundation for our relationships), and the cultures there actually contribute to the larger culture of a society. So a focus on fostering organizational cultures in which people approach those who think differently with curiosity rather than disdain, where colleagues and members listen to each other with true openness and a goal of real understanding, can have a vast benefit not just for business, but for our whole country.
Randy Lioz is founder of DOC: Depolarizing Organizational Cultures, which helps organizations of all types develop healthy cultures that foster a sense of belonging for all their members and employees. Prior to that he worked in a variety of roles for Braver Angels, one of the leading national groups focused on reducing political polarization. He has worked with organizations from a variety of sectors to address internal cultural challenges, including nonprofits, religious organizations and educational institutions, as well as business clients from the Fortune 500.
