As more Republican-led states consider laws targeting the rights of the LGBT community, the nation’s business sector is providing some of the most vigorous opposition, creating an uneasy tension between GOP conservatives and a historically loyal support base for the party.
The situation reached a head this week in North Carolina, where House Bill 2, which critics say will limit legal protections for LGBT individuals, was signed into law by Republican Gov. Pat McCrory. In response, PayPal ditched plans for a new $3.6 million operations center in Charlotte that would’ve employed 400 people.
In Mississippi, Republican Gov. Phil Bryant on Tuesday signed HB 1532 into law, which allows religious groups, businesses and individuals to deny services to the LGBT community.
On Wednesday, executives from eight large companies, including GE, the Dow Chemical Co., PepsiCo, Hyatt Hotels Corp. and Whole Foods Market, signed on to an open letter calling for Bryant and state lawmakers to repeal the measure.
“The business community, by and large, has consistently communicated to lawmakers at every level that such laws are bad for our employees and bad for business,” reads the letter, which was written on stationery from the Human Rights Campaign, a national gay rights organization.
This is not a direction in which states move when they are seeking to provide successful, thriving hubs for business and economic development.
Letter from several companies to lawmakers in Mississippi about House Bill 1523
Similar corporate angst is building in Missouri for SJR39, a broad religious-exemption measure that critics say would allow sweeping discrimination against married same-sex couples. If voted out of the legislature, it would go before state voters as a ballot measure.
Companies such as Dow, Google, AT&T and Monsanto and the St. Louis and Kansas City chambers of commerce have opposed the measure. The Kansas City Sports Commission has warned that the bill would keep Missouri from being considered for major sporting events, which would cost the state millions.
The Kansas City Sports Commission has warned that the bill would keep Missouri from being considered for major sporting events, which would cost the state millions.
State Sen. Bob Onder, a St. Charles, Missouri, Republican who’s the bill’s sponsor, said recently that the predictions of economic ruin for Missouri if the “religious freedom” amendment were approved were overblown.
“We look at states that have a lot of aggressive gay-rights laws, like Illinois, and they are some of our economic basket cases,” Onder said. “I really think that these businesses should leave well enough alone and let Missouri voters decide whether to protect religious freedom.”
But Rose Saxe, senior staff attorney with the American Civil Liberties Union’s LGBT and HIV Project, said that “with both the Mississippi bill and the Missouri bill, the backlash is growing.”
Robert Reeg, president of MasterCard Technologies in O’Fallon, Missouri, personally wrote Missouri Gov. Jay Nixon earlier this month to applaud the Democratic governor’s opposition to the measure.
I really think that these businesses should leave well enough alone and let Missouri voters decide whether to protect religious freedom.
Missouri state Sen. Bob Onder, sponsor of a religious exemption measure
“MasterCard condemns any legislation that has the potential to allow for discrimination in any form,” Reeg wrote. “Diversity is built into the fabric of our company, and inclusion is what propels us to leverage our technology and expertise to benefit people of all demographics and sexual orientations.”
In an email response to questions from McClatchy, Reeg said the proposal could affect corporate decisions.
“While MasterCard is not looking at new locations at this time, we would definitely factor in legislation like Missouri Senate Joint Resolution 39 or comparable laws in other states in making a decision,” he wrote.
The activity highlights a continued shift from corporate America’s historic reluctance to wade into controversial social issues.
Deena Fidas, who directs the workplace equality program at Human Rights Campaign, said the new corporate activism grew out of years of slow progress in getting the business community to realize that attacks on LGBT civil rights were “tantamount to attacks on an open, viable business environment.”
“Therefore these are not just out-there social issues,” Fidas said. They represent laws and “court cases that have a material impact on businesses.”
Deena Fidas, Human Rights Campaign, on efforts to fight hundreds of LGBT bills proliferating after the U.S. Supreme Court legalized same-sex marriage in 2015
In addition to being the right thing to do, Fidas said, promoting workplace equality and tolerance helps companies recruit and retain employees, which helps boost their economic competitiveness.
In South Dakota, Republican Gov. Dennis Daugaard vetoed a bill last month that would have forced transgender students to use bathrooms according to their sexes at birth rather than their chosen gender identities. Fidas said opposition to the proposal by major financial companies such as Wells Fargo and Citigroup helped kill the measure.
A similar transgender student bathroom bill being considered by the Tennessee legislature is drawing opposition from companies there such as Dow Chemicals, Viacom and Hewlett-Packard, along with businesses in the state’s tourism industry.
In a joint letter identical to the one signed Wednesday by businesses in Mississippi, top executives at Choice Hotels International, Alcoa Inc., Dow Chemical Co. and Hewlett Packard Enterprise called on Tennessee Lt. Gov. Ron Ramsey and state House Speaker Beth Harwell, both Republicans, to kill the legislation.
“We believe that SB 2387 will make it far more challenging for businesses across the state to recruit and retain the nation’s best and brightest workers and attract the most talented students from across the country,” the letter reads. “It will also diminish the state’s draw as a destination for tourism, new businesses and economic activity.”
Historically, conservative organizations such as the National Organization for Marriage would organize boycotts against companies that didn’t reflect their principles and values. General Mills faced a boycott from the organization in 2012 when it opposed Minnesota’s marriage amendment, a ballot measure that would have banned same-sex marriages. Voters defeated the proposal in November 2012.
Companies fearful of negative publicity and potential revenue loss typically stayed on the sidelines of such issues. But Fidas said the threat of boycotts over matters relating to equality and civil rights had largely vanished as a leverage tool.
Representatives from the National Organization for Marriage did not respond to requests for comment.
Jason Hancock of the Kansas City Star contributed to this report.