The double-edged sword: polarized stakeholder engagement with corporate sociopolitical activism and its downstream effects on brand performance

• Analyzed how stakeholder online reactions to CSA impact brand performance. • Studied user reactions to 159 brands’ CSA engagement on a divisive issue. • Labeled 41,358 targeted online responses to CSA stances as callouts or shoutouts. • Shoutouts offer a temporary stock boost but fade quickly. • Callouts persist and snowball, harming broader engagement and stock returns. This study explores how stakeholder reactions to corporate sociopolitical activism (CSA) on ‘X’ influence brand engagement and stock performance. Our research shifts focus from corporate messaging to stakeholder-driven conversations, demonstrating that CSA’s impact extends beyond brand statements and is shaped by public discourse. We analyze both direct replies to brand-authored CSA posts and organic user-initiated discussions, where consumers engage brands using hashtags and mentions. Using data from the 2022 humanitarian crisis in Ukraine, we examine 41,358 targeted user posts referencing 159 publicly traded brands’ CSA engagement. Sentiment analysis and topic modeling of 1,322 brand tweets, 39,578 replies, and stock data reveal that CSA amplifies both shoutouts (praise) and callouts (criticism). While shoutouts provide a brief stock boost before fading, callouts trigger a sustained decline in engagement and stock performance, creating a snowball effect. These findings highlight the trade-offs of CSA and the importance of proactive strategies in managing stakeholder responses.