Corporate Virtue Signaling, When CSR Goes Rogue
by Kathleen Sgamma, President on August 21, 2018 - 12:17pm
We’ve already seen companies like New Belgium Brewery and Patagonia fund anti-fracking environmental groups and activities. And of course the Outdoor Industry Association and many of its members are advocating against responsible oil and natural gas development on public lands.
But Bank of the West took it up a notch earlier this month with a social media post that kicked off a major campaign. The Craig Press reported that the original Facebook post said “We've made the decision to take action; we will no longer fund tobacco, coal, fracking, or Arctic drilling." But then the post was edited to say divesting from “coal, tar sands, shale oil and artic [sic] drilling…” as Western Wire reported.
Setting aside the intellectually disingenuous grouping of energy with tobacco, the Corporate Social Responsibility (CSR) messaging was very confused, as you might expect for a bank with U.S. headquarters in San Francisco and a French parent. I mean, when CSR departments go beyond ensuring companies are good corporate citizens to virtue signaling, the staff may be well-versed in gender studies perhaps, but not so much in economics and energy.
Juxtaposing tar sands with shale oil could indicate abandoning unconventional heavy oils, just maybe a confusion of terminology between oil shale and our ubiquitous shales. Despite the attempted backtracking from the original Facebook post, it did originally say “fracking.” Doing a little digging on the Bank of the West blog turned up a commitment to “exiting fracking” in 2017. How did we miss that! And why single out Arctic drilling if you’re going after all oil development?
The reaction in Craig and Moffat County, Colorado was swift. The 27-year veteran manager of the local branch resigned in support of her coal-country community, new customers flooded other banks, and the county commissioners announced they were transferring accounts elsewhere. Wyoming Treasurer Mark Gordon announced no future state funds will be deposited in the bank.
Did any of these actions reverberate with the company? Perhaps Bank of the West corporate did notice, but it’s unlikely to have registered a blip on the radar screen of the French parent company, BNP Paribas. Probably the reaction was that the collapse of one branch and the lack of business from one small state are more than made up by the marketing benefit gained from virtue signaling.
Or does it? A recent Morning Consult report on CSR found that a sizeable majority of Americans think corporations should stay out of cultural and political matters. Respondents who think companies should get involved barely counted for more than those who don’t have an opinion. From the NFL to outdoor recreation, people may just be getting tired of the politicization of everything.
Bank of the West’s billboards and online videos might just strike the wrong chord, and not just in coal country Colorado or Wyoming. The messaging right now specifically targets tobacco, but how soon before we see similar adds with a drilling rig instead of a cigarette?
I’m particularly amused by the other use of these supposedly virtuous investments–supporting women entrepreneurs. As far as I can tell, Bank of the West has been free to invest in any company, whether run by a woman or man, but again, let’s not let logic get in the way.
What happens if that woman entrepreneur wants to start her own oil and natural gas company? Forget I asked. I can already hear the heads exploding at the CSR department in San Francisco.