Americans believe in free speech. We share a social contract that assures every individual the right to life, liberty, and the pursuit of happiness. What happens when these cherished principles intersect with the realities of corporate responsibility and societal norms?

Should Americans boycott companies that enable the distribution of offensive speech?

How should companies that champion First Amendment rights above all else position themselves?

The 21st Century is one of “Managing for Stakeholders.” The task of executives is to create as much value as possible for stakeholders without resorting to tradeoffs. Great companies endure because they manage to get stakeholder interests aligned in the same direction. — R. Edward Freeman

Americans have the right to boycott companies for any reason of their choosing. These reasons might include political donations, treatment of employees, stances on social issues, and other policy positions.

R. Edward Freeman, Ph.D., American philosopher and Elis and Signe Olsson Professor of Business Administration at the University of Virginia Darden School of Business, pioneered modern Stakeholder Theory in Business. Stakeholder Theory has profoundly impacted business ethics and corporate social responsibility practices.

Stakeholder Theory posits that a firm should “create value for all stakeholders, not just shareholders.” These stakeholders include employees, customers, the broader community, and shareholders. In A Stakeholder Approach to Strategic Management, Freeman and John McVea outline decisive factors businesses must consider, including integrating stakeholder equity into the firm’s purpose to achieve survival. Towards this aim, business executives must establish and share their firm’s core values and invest in the relationships that will ensure long-term success for their organization.

Imagine a social media company facing backlash for allowing offensive speech on its platform. Applying Stakeholder Theory, the company's executives would need to evaluate how this speech impacts all stakeholders. For employees, it could create a hostile work environment; for users, it might foster an unsafe online community; for advertisers, it could associate their brands with harmful content, and for shareholders, it might lead to financial losses due to consumer boycotts.

You can watch Dr. Freeman’s entertaining TedX Charlotte presentation, “Business is about Purpose,” here.

Thomas Donaldson and Thomas Dunfee, in their work Ties That Bind: A Social Contracts Approach to Business Ethics, considered social contract theory for economics. The book’s introductory analogy is a handshake between business partners, symbolizing a contract. Donaldson and Dunfee identify fairness, respect for others, and integrity as fundamental business principles. They further identify challenges, such as cultural differences, that lead to varied business expectations. 

The social contract is an intriguing construct, especially in the context of business and consumer relations. This theory posits that just as citizens can hold their government accountable in a social contract, consumers have a parallel right to hold businesses accountable. When businesses fail to uphold ethical standards or societal values, consumers can perceive this as a breach of the implicit social contract.

In short, businesses must balance the interests of all stakeholders, and stakeholders (like consumers) have the right to hold companies accountable when they fail to do so.

For example, when a company engages in practices that are harmful to the environment, consumers may respond with boycotts. Donaldson and Dundee use Shell Oil as a case study in their book. This action is not merely a market choice; it's a form of holding the company accountable for violating the implied ethical agreement that it would operate in line with the American social contract.

This business-consumer social contract might seem at odds with other strong American views. The social contract of America, as articulated in the Declaration of Independence, assures every individual the right to life, liberty, and the pursuit of happiness. Embedded within this concept of liberty is our cherished freedom of speech. This poses a challenging question: How do we reconcile a business’s responsibility to its stakeholders with the protection of free speech, particularly when the speech is objectionable?

Freedom of speech is part of the national consciousness and legally protected by the First Amendment. This freedom is championed by media companies as a fundamental right that allows for the free exchange of ideas, opinions, and information.

Our first question. Should Americans boycott companies that enable the distribution of offensive speech?

Freedom of speech represents protection from the government. Freedom of speech is not protection from consequences and judgement from fellow citizens. Further, Americans sometimes cross a line of acceptable speech. We might call this speech objectionable, or hate speech at its extreme. Hate speech has no clear definition across America.

When Americans cross this line, our national social contract comes into play. If media platforms fail to consider their consumers and allow what many consider is hate speech on their platform, consumers vote with their dollar and leave. If media platforms fail to consider their fellow corporations who pay them for advertising space, those corporations might judge the media company is untrustworthy and pull advertising dollars.

In this context free speech is a philosophical issue as much as a legal one.

If free speech is a philosophical issue in the realm of a social contract wherein consumers have the right to hold companies accountable for a failure to maintain civil discourse, Americans could boycott companies that enable the distribution of offensive speech.

However, Americans also have a responsibility to respect the rights of others. The intricate balance between personal liberty and national division creates a resilient, enduring, free society. America relies on the individual liberty that empowers personal freedom, even while individual liberty creates division. This relationship demands we respect and fight for the liberty of others, even when they oppose our views.

Where’s the line between our right to boycott speech we don’t agree with and our responsibility to respect the rights of others?

Speech that calls for violence against others clearly violates the social contract as this speech disregards the lives and liberty of others. To uphold this social contract Americans should work to influence social media platforms to ban groups that have demonstrated a history of violence. We must take all calls for violence as a legitimate threat to others. Likewise, words enabling other criminal acts, such as human trafficking, pedophilia and other heinous activities, must be eliminated. These activities are threats to the lives and liberty of others, and those who support or enable this speech violate the American social contract.

However, when individuals or groups use social media platforms for offensive language that doesn’t call for violence and the group has no history of violence, we must tolerate their behavior. Using offensive language doesn’t violate anyone else’s rights. Those who would be offended can demonstrate their right to speech by responding, or they can demonstrate their right to refuse to learn from viewpoints with which they don’t agree and direct their attention elsewhere. Those who support the safe but objectionable views of others support the American social contract.

The American social contract extends to private companies. Businesses must balance the interests of all stakeholders, and stakeholders (like consumers) have the right to hold companies accountable when they fail to do so.

Our second question. How should companies that champion First Amendment rights above all else position themselves?

Let’s consider Dr. Freeman’s Stakeholder Theory again. Companies need to integrate stakeholder equity into the firm’s purpose to achieve survival. Freeman identifies many stakeholders, including customers, government, shareholders, owners, employees, and others. Social media platforms that seek to integrate stakeholder equity across this diverse group should take the American social contract into account—every individual has the right to life, liberty, and the pursuit of happiness.

Media companies themselves only offer a platform. They are not the source of offensive speech. Social media companies that fail to ban threats to life and liberty are perceived to break our social contract and have no protection from individual Americans who could choose to boycott their brand. However, lacking calls for violence or a history of violence, social media platforms that enable free speech support our social contract.

Media companies should build equity among stakeholders by enabling individuals the right to life, liberty, and the pursuit of happiness. When speech calls for violence, or the group has demonstrated a history of violence, platforms must block these groups. If they fail to do so, consumers will boycott their brand. For anyone claiming a loss of First Amendment rights for these groups, consider—these groups could create their own platforms. Existing media platforms don’t owe anyone the right to post anything of their choosing.

However, if a social media platform fashions itself a defendant of free speech, speech that doesn’t call for violence must be tolerated. Some of the users will be criticized as “snowflakes, elitists, woke, misogynists, trolls, or fascists,” among other names. There will be calls from both sides to deplatform the other.

Though the two sides might fail to admit their commonality, they both share a belief that their freedom of speech is part of the American social contract. Removing one group’s ability to speak freely threatens a loss of free speech for us all.

Americans believe in free speech. We share a social contract of life, liberty, and the pursuit of happiness.

Should Americans boycott companies that enable the distribution of offensive speech?

Speech that calls for violence against others clearly violates our social contract. Americans should work to influence social media platforms to ban groups that have demonstrated a history of violence.

When individuals or groups use social media platforms for offensive language that doesn’t call for violence, we have a responsibility to tolerate their behavior.

How should companies that champion First Amendment rights above all else position themselves?

Social media platforms that seek to integrate stakeholder equity should take the American social contract into account—every individual has the right to life, liberty, and the pursuit of happiness. Freedom of speech is part of our national social contract.

When speech doesn’t threaten the lives and liberty of others, removing one group’s ability to speak freely threatens a loss of free speech for us all.

May God bless the United States of America.

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