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Companies Adapt to Activism by Athletes

Summary:
See Sweetgreen Bet Big on Naomi Osaka. Then It Doubled Down. by Heather Haddon of The WSJ. Should companies try to improve society or try to make a profit? Might they make society better off by trying to maximize their profit? In his book The Wealth of Nations, Adam Smith wrote about how self-interested people were led by the "invisible hand" to make society better off:"But the annual revenue of every society is always precisely equal to the exchangeable value of the whole annual produce of its industry, or rather is precisely the same thing with that exchangeable value. As every individual, therefore, endeavours as much as he can both to employ his capital in the support of domestick industry, and so to direct that industry that its produce may be of the greatest value; every

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See Sweetgreen Bet Big on Naomi Osaka. Then It Doubled Down. by Heather Haddon of The WSJ.

Should companies try to improve society or try to make a profit? Might they make society better off by trying to maximize their profit? 

In his book The Wealth of Nations, Adam Smith wrote about how self-interested people were led by the "invisible hand" to make society better off:

"But the annual revenue of every society is always precisely equal to the exchangeable value of the whole annual produce of its industry, or rather is precisely the same thing with that exchangeable value. As every individual, therefore, endeavours as much as he can both to employ his capital in the support of domestick industry, and so to direct that industry that its produce may be of the greatest value; every individual necessarily labours to render the annual revenue of the society as great as he can. He generally, indeed, neither intends to promote the publick interest, nor knows how much he is promoting it. By preferring the support of domestick to that of foreign industry, he intends only his own security; and by directing that industry in such a manner as its produce may be of the greatest value, he intends only his own gain, and he is in this, as in many other cases, led by an invisible hand to promote an end which was no part of his intention. Nor is it always the worse for the society that it was no part of it. By pursuing his own interest he frequently promotes that of the society more effectually than when he really intends to promote it. I have never known much good done by those who affected to trade for the publick good. It is an affectation, indeed, not very common among merchants, and very few words need be employed in dissuading them from it."

Excerpts from the WSJ article"

"Many companies are now pursuing “purpose-driven marketing,” industry experts say, seeking to demonstrate their commitment to improving society, as well as customers’ meals or cleaning routines. Americans, meanwhile, are placing more trust in the values a company projects. More than half of 2,000 adults surveyed recently by market-research firm Mintel said they consider buying from brands they view as ethical a form of activism.

And athlete activism has also grown, especially around the tumultuous summer of 2020, with mental health advocacy a cause embraced by athletes in sports including gymnastics, track and swimming. For some athletes, such activism extends to striking deals with brands that they say support them in their advocacy and their personal lives.

“What drew me to Athleta is that they don’t only care that we’re an athlete but they truly care about how we’re doing as individuals and what we want to accomplish outside the sport,” gymnast Simone Biles told The Wall Street Journal in April when she said she was leaving Nike for the Gap. Inc.-owned brand.

Ms. Osaka, the No. 2 women’s tennis player in the world, has won prize money and endorsement deals from companies such as Nike and Mastercard Inc. worth more than $50 million.

She has also been an outspoken advocate for social causes. She forced a suspension of her semifinal match during the Western & Southern Open last summer to protest police violence against Black people following the shooting of Jacob Blake in Kenosha, Wis. She wore face masks bearing the names of Black victims of racist violence or police brutality during the U.S. Open."

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