Wayfair employeesstaged a mass walkout from company headquarters in Boston on Wednesday to protest its business connection to migrant detention centers.
Harvard Business School historian Nancy Koehn joined Boston Public Radio on Thursday to discuss how both Wayfair leaders and protesters are managing the situation. Koehn began by relating the events leading up to the walkout.
"Last week, a Wayfair employee discovered that Wayfair had sold about $200,000 worth of bunk beds and mattresses to Baptist Child and Families Services," she said. "They are running a number of detention centers in which, as one lawyer said, 'In all my years of being an advocate for humanitarian clients, I have never seen conditions like I have seen in these centers.' An employee discovered this and immediately generated a lot of conversation among others. Employees then took it upon themselves to say, 'We're not happy about this, we need an explanation. We don't want to work for a company that does this.'"
Employees were further affronted when Wayfair executives released a statement confirming that the company will continue to sell goods to customers who are operating within the law, Koehn said.
"Employees were so upset by this that they staged a walkout in which several hundred employees in their headquarters, which are here in Boston, walked out and stood in Copley Square," she said.
Koehn emphasized that today's political climate creates an environment where all corporations are subject to public political scrutiny.
"If you're running a public corporation or a private entrepreneurial start-up or a large private equity firm, you are inherently making decisions that are political," she said. "In an age of greater transparency, the public wants to exercise some agency [under] a government that can't make decisions. A CEO or a leader that thinks you can pull the curtains closed on the window that looks out on how companies are evaluated, is either very naive or completely asleep at the wheel."
The biggest issue at stake for Wayfair isn't a consumer boycott, rather, the lasting damaging to the company's reputation as a whole, Koehn said.
"What's really interesting about this case is that it is in many ways another indication of the rising importance of employees' voting on the companies they work for," she said. "The biggest issue here is not necessarily consumer boycott in the short run. I think it's the employee brand, the employee reputation. If they don't figure out how to turn this around pretty quickly, their brand will be seriously tarnished."
Koehn is an historian at the Harvard Business School where she holds the James E. Robison chair of Business Administration. Her latest book is "Forged in Crisis: The Power of Courageous Leadership in Turbulent Times."