The paradox of being profitable and moral: the role moral authority plays in corporate sociopolitical activism

Abstract

While stakeholders expect businesses to take sociopolitical stances, the moral authority of such efforts is often questioned. This research examines how consumers perceive companies’ moral authority, its consequences in the context of corporate sociopolitical activism (CSA), and how it can be enhanced. The results of five experiments reveal that companies are perceived to have lower moral authority than nongovernmental organizations (NGOs) due to having more ulterior motives, and the impact of ulterior motives on the perception of moral authority is more pronounced for conservative consumers. Moreover, partnering with an NGO and demonstrating prior cause-aligned initiatives increases a company’s perceived moral authority, affecting reputation, attitudes, product choice, and willingness to pay. However, these effects only hold for liberal stances. These insights contribute to the debate on CSA’s impact on consumer perception and address calls for research on moral authority.