For Gen Z, the Future of Corporate Activism Is Local First, Global Second
Key Takeaways
U.S. consumers of all ages are increasingly skeptical that the brands they buy from behave ethically overseas, even as they say they want to buy from companies that reflect their social values.
Relative to older generations, younger consumers express strong demand for corporate action on hot-button domestic issues like race and abortion but lower demand for activism on traditional geopolitical issues. On balance, zoomers and millennials say they would keep buying from brands operating in countries that repress civil liberties like freedom of speech, and they are ambivalent about boycotting companies that operate in countries actively involved in invading a neighbor.
A loss of faith in American exceptionalism may be driving these preferences, particularly among Gen Z: Compared with baby boomers, the net share of Gen Z adults who say they are proud to live in the United States is 57 percentage points lower.
As such, Gen Z may not want to see the United States — and by extension, U.S. companies — acting as arbiters of global ethics. But they still care how companies treat their employees across markets.
For companies, messaging on more traditional aspects of geopolitics (like war) is likely to become somewhat less important relative to messaging on global labor and social practices as Gen Z comes to wield an increasing share of U.S. purchasing power.
Corporate purpose goes global, but which generation is pushing it?
Corporate purpose has gone global. With public trust in institutions on the decline and ethical consumerism on the rise, people are increasingly looking to companies to take action on geopolitical issues like climate change, cyberthreats, human rights and forced labor that lie beyond the more traditional emphasis on war and armed conflict.
Perhaps driven by images of young activists protesting at major international events, the common perception is that younger generations are driving this global expansion of activist consumerism. But when it comes to consumers’ relationships with and expectations of the brands they buy from, the generational picture is more complicated.
Majorities in every generation favor ethical consumerism, but Gen Z is the least enthused
The majority of U.S. consumers (59% as of late December) say they want to purchase goods and services from companies that reflect their social values. This includes large — but unequal — shares of each generation, with Gen Z adults the least likely to say so. Gen Z’s differing views become even more noticeable when assessed on a net basis: The share of Gen Zers who say they favor values-based purchasing is only 28 percentage points higher than the share who don’t, compared with differences of 40 and 41 percentage points for baby boomers and millennials, respectively.
Gen Z Consumers Express the Lowest Demand for Ethical Consumerism
At the same time, all generations have become increasingly skeptical that the brands they buy from are behaving ethically overseas. This finding is again most stark among Gen Z, which exhibits a 19 percentage point drop over the last six months.
Gen Z Consumers Are Increasingly Skeptical That Companies Behave Ethically Overseas
Geopolitical issues are less likely to drive young consumers to change their purchasing habits
On hot-button domestic topics like abortion access and support for the Black Lives Matter movement, Gen Z adults say they will boycott brands that profess positions antithetical to their own at higher rates than any other generation. But at the same time, younger adults are less likely to single out unethical overseas practices as a reason to change their purchasing habits relative to both domestic issues and other generations.
In a surprising result that has held across multiple survey waves, Gen Z and millennial respondents also say they would more likely than not keep buying from brands that operate in repressive countries, such as ones that limit freedom of speech or freedom of the press. And they are lukewarm about boycotting companies that operate in countries actively involved in invading a neighboring nation or territory. Herein lies the paradox: Gen Z adults — and to a lesser extent, millennials — express a readiness to use their purchasing power to push for corporate action in support of the Black Lives Matter movement despite their relatively low support for boycotting companies that do business in repressive countries with similarly strained ethnic or religious tensions.
Younger Consumers Are Less Interested in Certain Aspects of Global Corporate Purpose
Low belief in American exceptionalism may shape Gen Z’s demand for corporate action
One interpretation of this finding is that Gen Z’s sense of corporate morality stops at the U.S. border. But our data suggests this is unlikely. Instead, additional evidence indicates that younger generations may not think the United States — and by extension, U.S. companies — have the moral high ground to act as arbiters of ethics overseas due to persistent sociopolitical challenges at home.
Gen Z adults are 18-25 years old, a formative age for political views. For today’s zoomers, COVID-19 lockdowns, social unrest and graphic images of police brutality may be causing them to abandon a sense of American exceptionalism relative to older cohorts, especially in terms of respect for civil liberties at home compared with less democratic countries. If younger Americans think the United States is just one of many countries that “regularly represses civil rights,” as our corresponding survey question states, then this would explain why they hesitate to boycott companies for operating in what they see as similar environments overseas. As the adage goes, he who lives in a glass house should not throw stones.
Gen Z adults have much lower trust in U.S. government institutions than older generations. They are also much less likely than other cohorts to say they are proud to live in the United States. Gen Z has by far the lowest net share expressing such patriotic sentiment: At just 16 percentage points in net agreement, they clock in 20 percentage points below the next lowest generation (millennials) and a whopping 57 percentage points below baby boomers.
Patriotic Sentiment Is Lowest Among Gen Z Adults
Zoomers will zoom in on domestic concerns and call out inconsistencies between companies’ domestic and overseas behavior
Currently, Gen Z adults have low purchasing power relative to millennials and Gen Xers further along in their careers, with adults ages 18-29 accounting for only 10% of all U.S. adults earning at least $100,000 a year. But it is worth trotting out the trope that the younger generations are the future, both in a political and commercial sense. Their preferences will increasingly drive the pressures exerted on companies — whether as their customers, employees or shareholders — as Gen Z grows into a larger portion of the workforce and investment community.
The waning conviction among younger U.S. consumers that American companies behave ethically overseas, and their indifference toward corporate activism on traditional geopolitical issues, together signal a more focused application of youth-driven corporate activism in coming years. At the same time, Gen Z is likely to be more critical of any inconsistencies they detect across companies’ domestic and international practices related to social issues like labor treatment and environmental stewardship.
For companies, and particularly multinationals, tracking how consumers’ perspectives evolve with world events will be key to understanding how to message consistently on these issues to younger audiences, and to navigating variability in generational demand for corporate activism in the years ahead.
Looking for more insights into how people around the world view ethical consumerism? See our Global Corporate Purpose Tracker here.
Sonnet Frisbie is the deputy head of political intelligence and leads Morning Consult’s geopolitical risk offering for Europe, the Middle East and Africa. Prior to joining Morning Consult, Sonnet spent over a decade at the U.S. State Department specializing in issues at the intersection of economics, commerce and political risk in Iraq, Central Europe and sub-Saharan Africa. She holds an MPP from the University of Chicago.
Follow her on Twitter @sonnetfrisbie. Interested in connecting with Sonnet to discuss her analysis or for a media engagement or speaking opportunity? Email [email protected].