Business must stand up for the rule of law

This isn't the Earth Day post I wanted to write.

As a sustainability communication professional—today, I'd rather be discussing how the Mauno Loa observatory has showed the first weekly average carbon dioxide concentration of over 430 parts per million in about 3 million years, that there has been a catastrophic 73 percent decline in the average size of global wildlife populations in just 50 years, or that there were 27 “billion-dollar” weather and climate disasters in 2024. I’d then proceed to explain the significance of all this in economic terms, and how communication helps companies engage stakeholders to act on these issues. 

While these environmental concerns continue to very much matter, any hope of addressing them means facing an even more pressing problem: the preservation of the rule of law in the United States.

The rule of law is the principle that everyone—citizens, organizations, and governments alike—is equally subject to publicly proclaimed laws enforced fairly through independent courts, ensuring no one is above legal accountability. This creates a predictable environment where contracts are enforced, property rights are protected, and all market participants play by the same rules. This legal stability reduces operational risks and transaction costs while building investor confidence—ultimately creating a foundation for sustainable economic growth and innovation.

President Dwight D. Eisenhower once said: “The rule of law does more than ensure freedom from high-handed action by rulers. It ensures justice between man and man however humble the one and however powerful the other.” All of this is now at risk thanks to the machinations of the Second Trump Administration.

For corporate sustainability to mean anything, it must stand for the fundamental conditions that make sustainable business possible. If we can’t defend the rule of law, all other sustainability initiatives become meaningless. And businesses don’t need a materiality assessment to understand that the rule of law is a key issue for all. Without it, shared prosperity perishes and the spirit of innovation dies alongside the liberties that generations of Americans have fought and died to uphold. 

In the face of a once-in-a-generation existential threat to the Republic, corporate sustainability professionals must join with the millions of others mobilizing to defend democracy from those currently trying to dismember it. And business—as a critical pillar of civil society—must use its influence to counter the dark tide of authoritarianism now spreading across our nation.

The rule of law matters for business

The rule of law in the U.S. has made it safe for Americans and people worldwide to develop ideas, monetize them, and feel secure that their contracts and property rights are protected. This has helped make the U.S. the richest country in history. While the American system has never been perfect and corruption certainly occurs, this was the exception rather than the rule. All of this is now at risk thanks to the Trump Administration’s reckless disregard for fact-based policymaking, utter disdain for the Constitution, and warm embrace of dictatorial destruction.

While the Trump Administration markets itself as “business-friendly” by promising deregulation and lower taxes, this ultimately is a devil’s bargain for companies. Trump's assertion that “he who saves his Country does not violate any law” should alarm every American business leader. And the Trump Administration’s deliberate destruction of the federal bureaucracy, attacks on the media, and attempts to subjugate higher education reflects its efforts to wield absolute political power. Once all legitimate forms of opposition are gone, the Trump Administration will be unopposed to do the same to the business community. Human rights concerns aside, from a practical point of view this also will be bad for business.

As Daron Acemoglu and James Robinson write in Why Nations Fail: "Those controlling political power will eventually find it more beneficial to use their power to limit competition, to increase their share of the pie, or even to steal and loot from others rather than support economic progress.”

Autocratic governance may lead to a few well-connected and obsequious firms benefiting, but the vast majority will lose out. Companies will have to factor into their financial models “bribery budgets” to get anything done, and will be at the mercy of the erratic whims of an aging autocrat. It’ll no longer be a free market where the best ideas, products, and services win the day—but about whoever bends the knee to the Trump Administration.

Recognizing the red flags

Retired Marine General John Kelly, who served as Trump's White House Chief of Staff from 2017 to 2019, stated that Trump “certainly prefers the dictator approach to government” and “falls into the general definition of fascist,” while also revealing that Trump had expressed admiration for Hitler's generals.

What the Trump administration implemented during its first term now seems mild compared to the alarming actions taken in just the first 100 days of his second term. The unelected billionaire Elon Musk's so-called “Department of Government Efficiency” has gutted federal agencies, harming businesses through layoffs, reduced demand for services, and market uncertainty. Simultaneously, election security funding has been slashed despite Trump's own election integrity concerns, suggesting a strategy to facilitate challenging future unfavorable results. Trump has damaged longstanding international relationships by undermining NATO, putting billions in U.S. business interests at risk, while alarmingly praising autocrats like Putin and disparaging democratic allies like Zelensky. His impulsive trade policies and tariffs have devastated small businesses, retirement investments, and threaten global economic stability. And the tariffs should worry business leaders immensely due to the fact that they aren’t true economic policies—but political ones. With blanket tariffs, Trump can force businesses to bend to his will or curry his favor to receive exemptions. That isn’t how business is done in a society positioned for long term prosperity. Meanwhile, the Trump Administration’s practice of snatching people off the street in unmarked cars because they’ve committed the “crime” of exercising free speech is the makings of absolute despotism and is one of the most anti-American activities imaginable.

“Freedom of speech is a principal pillar of a free government: When this support is taken away, the constitution of a free society is dissolved,” Benjamin Franklin once said.

Also disturbing is the administration’s defiance of a Supreme Court order after wrongfully deporting a Maryland man to El Salvador, prompting Reagan-appointed Judge Wilkinson to warn that the government claims the right to imprison people without due process. This is a precedent that, if unchallenged, could eventually threaten any resident or citizen, fundamentally undermining the rule of law for everyone, including businesses.

While the U.S. government was designed with three co-equal branches to create checks and balances that prevent autocratic rule, this system now faces unprecedented strain. With elected Republicans fully aligned behind the Trump Administration and a Supreme Court tilted in its favor, traditional guardrails are essentially gone. What's particularly alarming is the Trump Administration's preference for governing through executive orders despite controlling both houses of Congress—a strategy that suggests they aren’t concerned about future administrations reversing their policies. This approach aligns disturbingly with Trump’s statement that “In four years, you don't have to vote again. We'll have it fixed so good, you're not going to have to vote.” While some might dismiss such comments as hyperbole, Trump has repeatedly used "jokes" to normalize extreme ideas before implementing them. Given the historical pattern and the fragility of democratic institutions, we must take these signals seriously—the stakes for American democracy and the rule of law are simply too high to ignore warning signs of authoritarian consolidation.

“What is happening now is not normal politics,” The New York Times columnist David Brooks recently wrote. “We're seeing an assault on the fundamental institutions of our civic life, things we should all swear loyalty to—Democrat, independent or Republican.”

Brooks calls for a “comprehensive national civic uprising” made up of Americans in universities, law, business, nonprofits, the scientific community, and civil servants to form one coordinated movement.

"Trump is about power," Brooks writes. "The only way he's going to be stopped is if he's confronted by some movement that possesses rival power."

Businesses united have the power to oppose Trump. So, why aren’t they?

This diagram shows the prisoner’s dilemma businesses face in speaking out against the Trump regime.

The business dilemma

While much of the corporate sustainability community has been busy lamenting companies like Target, Walmart, Meta, and Google for abandoning or rolling back diversity initiatives, it's time to focus on the bigger issue—speaking up for the rule of law.

Businesses facing autocratic regimes encounter a classic prisoner's dilemma: while collective opposition could potentially force reforms benefiting all, individual companies rationally choose silence to avoid severe punishment—such as asset seizure, executive imprisonment, and forced closure—when others might not join them. The autocrat exploits this coordination problem by making examples of dissenters, offering selective benefits to loyal businesses, limiting inter-business communication, and cultivating uncertainty. This creates a stable equilibrium where businesses become unwitting accomplices in maintaining the very system that exploits them.

Prior to the American Revolution, Alexander Hamilton wrote: “If the sword of oppression be permitted to lop off one limb without opposition, reiterated strokes will soon dismember the whole body.” He cautioned against allowing even small infringements that eventually lead to widespread oppression.

In only a few months, we’ve already lost too many limbs of liberty. But it’s not too late to turn the tide. 

Standing tall against intimidation

The Trump Administration’s assault on higher education has shown the pointlessness of capitulation. Harvard's President Alan Garber demonstrated courage when he said: “No government—regardless of which party is in power—should dictate what private universities can teach, whom they can admit and hire, and which areas of study and inquiry they can pursue. Our motto—Veritas, or truth—guides us as we navigate the challenging path ahead.”

The Trump Administration’s attacks on law firms representing his perceived enemies is only the beginning. They may even start stripping the tax exempt status of nonprofits whose mission he doesn’t approve of—basically, every environmental nonprofit in existence. Four years from now, these intimidation tactics may be quotidian for any business “stepping out of line.” 

But imagine if a CEO of a major corporation had similar gumption to say:

“We condemn the Trump Administration for [INSERT YOUR CHOICE OF DETESTABLE, LAWLESS ACTION]. We recognize that rule of law isn't just a legal concept—it's a business imperative. When regulatory predictability weakens in one market, it creates ripple effects throughout the entire business ecosystem. Our stakeholders expect consistency, transparency, and fairness in the legal frameworks that govern commerce. If arbitrary enforcement becomes acceptable in one sector, it inevitably spreads to others, undermining the market confidence that drives investment and innovation. As business leaders, we must advocate for consistent application of legal principles that enable fair competition and sustainable growth. Legal certainty isn't a partisan issue—it's fundamental to our ability to create long-term shareholder value, maintain investor confidence, and fulfill our commitments to customers, employees, and communities.”

What if hundreds of CEOs stood up and said this in together? Companies could cut funding to any Republican-aligned trade association or candidate until the Trump Administration relents on its worst authoritarian impulses. The Trump Administration couldn’t get away with punishing the entire S&P 500—at least, not yet. 

The personal stakes

In 2018, two of my cousins were arrested by the authoritarian Ortega regime in Nicaragua for peacefully protesting its oppressive policies. They were among 38 people arrested and accused of “instigative and provocative activity” and disturbing the peace.

Knowing how easily people can be disappeared in autocracies, I immediately called a friend at the State Department and used social media to raise awareness. Because my cousin Marcela is an American citizen with dual citizenship, this drew the attention of ABC News.

I was quoted in the article saying: “The world must wake up and recognize that what President Daniel Ortega and his wife, Vice President Rosario Murillo, are doing to their own people is a crime against humanity. They have betrayed the trust of the Nicaraguan people as they crack down on democratic reform in a ruthless attempt to solidify their power.”

Fortunately, my cousins were released unharmed. But the same can’t be said of the hundreds of people who were killed or disappeared by the regime. Never in my wildest nightmares did I think similar authoritarian tendencies could emerge in America. But we are already well on our way.

The fear is already there—even writing this piece makes me wonder if it will one day put me in an El Salvadorian gulag funded by my own tax dollars. As a former journalist, this apprehension is something I never expected to experience on American soil.

But I refuse to “obey in advance” as Timothy Snyder writes in his book, On Tyranny: “Most of the power of authoritarianism is freely given. In times like these, individuals think ahead about what a more repressive government will want, and then offer themselves without being asked. A citizen who adapts in this way is teaching power what it can do.”

My grandfather lied about his age to enlist in Patton’s army to fight fascism abroad in World War II, and my Nicaraguan family has risked life and limb to fight authoritarianism even when they had the financial resources to flee. We owe it to future generations to stand up for democratic norms while opposing hate, ignorance, and sheer stupidity. Yet too many companies are already “obeying in advance” in hopes of averting the Trump Administration’s wrath. While this might protect them in the short term, it’s a losing gambit. It starts with scrubbing sustainability reports of all mentions of DEI, and ends with the inability to do business without the blessing of the autocrat.

Now is the time to speak out

Like most things Trump says, his claims of an overwhelming electoral mandate are way overblown. As The Wall Street Journal’s conservative editor Holman W. Jenkins, Jr. writes: “November’s outcome, remember, tells us only how voters reacted to a binary choice. In fact, polls show most voters thought it was a lousy choice.”

And Doug Sosnik adds in his opinion piece in The New York Times: “Like his predecessors, Mr. Trump is overreading the mandate that voters gave him. While he was the first Republican to win the popular vote in 20 years, his vote share was under 50 percent, and his margin of victory was small by historical standards.”

The Trump Administration’s policies are causing real social, economic, and emotional pain for average Americans while benefiting only the richest among us. Eventually, this will be too much even for the radical right media propaganda complex to deny, downplay, or deflect. The American people will prevail because beating bad guys is our specialty. When that day comes, the companies that demonstrated courage during these difficult times will earn the trust of their stakeholders —while helping to ensure a freer, more stable world in which to do business.

The next four years will test both the resilience of American democracy and the moral courage of business leaders. Will we abandon our principles at the first sign of threat, or will we stand for the enduring values that have made sustained prosperity possible?

As the musical Hamilton reminds us: "If you stand for nothing... what will you fall for?"

Harvard suing of the Trump Administration is a strong sign that America’s great institutions are ready to to fight back. We need to see the same principled actions coming from the private sector.

The business community faces a choice that will define a generation. Individual companies speaking alone risk retaliation, while those remaining silent may temporarily benefit.

But if collective silence prevails, the foundation of American prosperity will crumble beneath us all.