Corporate Racial Responsibility

What is the role of corporations in the fight against racism? In 2020, following the murders of George Floyd and Breonna Taylor, many corporations publicly embraced racial equity and expressed their support for the Black Lives Matter (BLM) movement and other race conscious initiatives. Corporations, it seemed, were ready to take corporate racial responsibility seriously. But would their actions be meaningful?

In a recent article, we provide fresh understandings of corporate engagement on racial issues from both a contemporary and historical perspective. Title II of the landmark 1964 Civil Rights Act desegregated the nation’s public accommodations, and we rely on historical evidence surrounding Title II’s passage to demonstrate that the call for corporations to participate in racial justice movements is not new. During the civil rights movement, many activists, politicians, and business leaders invoked corporate social responsibility to encourage voluntary racial desegregation and end the pitched battles over Jim Crow.

Businesses were critical sites for anti-segregation protests and demands for corporate social responsibility in the 1960s, as waves of demonstrations erupted at segregated public accommodations. Initially, civil rights activists attempted to persuade individual businesses to end their Jim Crow practices, urging them to surpass their legal obligations and desegregate public accommodations voluntarily. Our article examines these attempts in two major cities: Birmingham, Alabama and Atlanta, Georgia. Civil rights scholars have long shown how demonstrations in Birmingham and Atlanta ultimately helped to create the political context for Title II’s passage and the watershed U.S. Supreme Court decisions, Katzenbach v. McClung and Heart of Atlanta v. United States, which upheld the act. Yet, developments in those cities before Title II’s enactment illustrated the limitations of depending on corporate racial responsibility – in this instance voluntary desegregation – to advance the nation’s struggle for racial justice.

In his Letter from the Birmingham Jail, Martin Luther King, Jr. detailed how Birmingham merchants reneged on their pledges to desegregate public accommodations and the fallout in the city that ensued. King and local activists launched nonviolent protests to induce these merchants to honor their promises, and the iconic Birmingham marches garnered international attention. This series of events profoundly demonstrated that counting on corporations to end segregation was a flawed strategy. The federal government needed to intervene to end the crisis. President Kennedy publicly condemned segregated public accommodations during the Birmingham protests, and soon thereafter he submitted Title II to Congress. In the long run, public accommodations did not desegregate due to corporate leadership; public accommodations only desegregated when corporate racial responsibility became corporate legal responsibility. Law reform mattered.

Atlanta highlighted other limits of relying on corporate racial responsibility to advance racial justice. Atlanta was nicknamed “the city too busy to hate” because city leaders said it was more interested in economic prosperity than racial domination. Though Atlanta had some success with voluntary desegregation, many of its civic and political leaders used the city’s progressive corporate image to oppose Title II. They claimed that Atlanta’s ability to achieve some voluntary desegregation proved that new, federal civil rights legislation was unnecessary. They added that such federal intervention would interfere with business and undermine cooperation between activists and corporations. Nonetheless, as in Birmingham, civil rights activists in Atlanta became dissatisfied with voluntary desegregation and turned to protests to champion Title II. Only after continued racial unrest did the city’s mayor agree to testify on behalf of Title II and acknowledge the need for legislation to achieve full desegregation.

Today’s corporations, like corporations during the civil rights movement, are being asked to play a pivotal role in achieving racial equity. Yet a closer look at corporate racial responsibility reveals echoes of the past. Modern-day critiques of corporate racial responsibility, which span the political spectrum, focus on three points. First, some claim that corporate racial responsibility is evidence of a new and impermissible agenda to extend corporate purpose into racial issues. Second, others argue that corporate attention to social and racial matters will diminish profitability to the detriment of shareholders. Third, still others critique corporate engagement as largely performative and insincere.

In our article, we rebut each of these claims to varying degrees. Yet our larger point is that these critiques miss the true harms that corporate racial responsibility can cause by emphasizing a market rather than moral case for racial justice. This market-based logic subordinates human dignity to wealth maximization and forces Black, brown, and other marginalized groups to establish their value as it relates to the corporate bottom line to be worthy of consideration. Taken to its logical conclusion, this approach requires marginalized groups to endure oppression if there is no wealth-maximization justification for businesses to engage with their concerns.

Moreover, corporate racial responsibility can actually stymie racial progress and reify racial hierarchies. As demonstrated during the civil rights movement and our current racial reckoning, non-regulatory approaches to racial equity will not likely lead to meaningful legal change. Indeed, corporations often point to their voluntary actions as a reason for rejecting regulatory intervention, claiming the market is already at work. But voluntary actions lack accountability and permanence—and thereby leave racial equity work to the whims of corporate willingness to engage in it.

Unfortunately, corporate racial responsibility extracts value from people without engaging in the structural changes needed to ensure serious racial equity. Many corporations made antiracist pledges in the wake of George Floyd’s murder and sought to demonstrate their commitment by promoting people of color to high-level positions or vowing to donate to racial justice campaigns. While these were ostensibly positive steps, they too frequently were token moves designed merely to embellish corporations’ images. In reality, most corporations have yet to undertake substantial internal structural changes, preventing racial initiatives from becoming embedded in corporations.

Corporations can play a role in racial equity, but they need to start by making internal changes to be more inclusive now. For example, they can work towards greater board and managerial diversity, ensure pay equity across racial and gender lines, and require better racial equity and progress from suppliers and service providers like law firms.

Corporations should also support, not supplant, civil rights leadership. Corporate leadership largely lacks racial and socioeconomic diversity and is likely far removed from ideas of racial change. Corporations should collaborate with racial justice organizations and approach the relationship as a true partnership.

Lastly, corporations should work to transform issues of corporate racial responsibility into issues of corporate legal responsibility. As the history of Title II illustrated, some corporations will not advance the cause of racial justice unless required to do so. Corporations themselves should lobby for new civil rights laws to ensure greater permanence and legitimacy of racial equity initiatives, thereby moving society towards being more just and democratic.

This post comes to us from Gina-Gail S. Fletcher and H. Timothy Lovelace, Jr. at Duke University School of Law. It is based on their recent article, “Corporate Racial Responsibility,” available here.

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