There is perhaps no clearer case study in the intersection of business and social issues than the rise of business activism on LGBTQ rights. For many years, companies have been working to improve their brands and internal practices around LGBTQ issues, investing in culture, benefits and marketing to welcome LGBTQ workers and customers and telegraph inclusion and openness. But in recent years, something has changed: More companies are speaking out about public policies that affect the LGBTQ community, and many are doing so in places where they face strong headwinds, putting their brands and political relationships on the line.. LGBTQ inclusion is good for the economy, and as more and more businesses make this connection, they are stepping up to make the economic case for anti-discrimination protections and against discriminatory laws. And they are not doing it alone. They are turning to coalitions to ensure they have strength in numbers, resources, and message alignment.
One of the clearest case studies of the intersection of business and social issues is how companies have handled the rise of LGBTQ rights.
For many years, companies have been working to improve their brands and internal practices on LGBTQ issues, investing in culture, benefits and marketing to welcome LGBTQ workers and customers, and telegraph inclusion and openness. Political activism has been a long time coming. In recent years, however, something has changed: More companies are speaking out about public policies that affect the LGBTQ community, and many are doing it in places where they face strong headwindsputting their brands and political relationships on the line — punctual action in a climate where legal and political debates continue about whether companies can refusing to serve LGBTQ people.
This increased public activity is largely the result of rapidly changing opinion, with Millennials and Gen Z often leading the way. Sixty-seven percent of young adults in the US do not believe small business owners should be allowed to refuse service to LGBT people on religious grounds, compared to 60% of Americans overall and 53% of seniors. millennials are now the largest group in the US workforce. and are essential to recruiting, branding, and consumer strategies. The change in public opinion they are driving has a wide range of economic impacts, such as the war for talent and the ability of cities and states to attract corporate investment. Tourism, including conventions and major sporting events, is a specific concern. In a 2016 surveyNearly 50% of US gathering planners said they would avoid planning events in states that pass anti-LGBTQ legislation. And net approval of same-sex relationships is emerging as a predictor of competitiveness and innovation in cities.
All this to say that LGBTQ inclusion is good for the economy, and as more and more businesses make this connection, they are stepping up to make the economic case for anti-discrimination protections and against discriminatory laws. And they are not doing it alone. They are turning to coalitions to ensure they have strength in numbers, resources, and message alignment.
In one example, then-Indiana Governor Mike Pence signed a “Religious exemption” bill that would have allowed businesses to turn away LGBTQ customers and prospective employees in 2015. This development was met with an immediate loss of 12 business conventions worth $60 million and the launch of the Indiana Competes business coalition advocating for LGBTQ nondiscrimination. The law was quickly modified. The pattern continued in 2016, when North Carolina lawmakers passed HB2 “bathroom bill” to restrict where transgender people could use the bathroom in public and in schools. HB2 was introduced, passed, and signed into law in a single day, and companies immediately began taking individual actions. Within a week of passing, two equality groups had organized over 140 top CEOs and business leaders in an open letter to the governor. In the year that HB2 remained law, the state lost $630 million at canceled sporting events, job opportunities, performances and conventions. The law was repealed in 2017.
That same year, Texas lawmakers pursued a similar “bathroom bill” and economists predicted massive losses: in tourism alone, $3.3 billion in annual gross product, and 35,600 full-time jobs, just initially. The legislation failed, but the state still saw $66 million at conventions canceled in the course of the debate. Three business coalitions were active in this effort: Texas Competes (a coalition that has been an economic advocate for nondiscrimination since 2015), Keep Texas Open for Business (a coalition within the state chamber of commerce), and Texas Welcomes All (a coalition of tourism actors).
These coalitions fulfill more than a convening role.
First, they reduce political risk by building critical mass. Because each company has its own legislative agenda, speaking out on a divisive issue, often in opposition to elected leadership, can risk political retaliation. But if a company is joined by its peers, the risk of being an isolated target is significantly reduced.
Second, coalitions centralize resources and expertise, such as political intelligence and data on the economic impacts of discrimination. While a company may internally support its LGBTQ employees, legislation affecting the LGBTQ community is often not the core competency of a corporation’s government affairs team, which tends to focus on industry issues such as regulations and taxes. This experience gap becomes an issue when public policies affecting LGBTQ people have potentially huge financial, operational, and brand impacts. Even following the legislation can be a challenge, because many measures with discriminatory intent can be worded in a confusing way, as was the case in 2008. California Marriage Protection Actand more recently, Question 3 in Massachusetts. Other measures may never explicitly mention LGBTQ people, such as with Arkansas Intrastate Commerce Improvement Act.
On their own, companies are less likely to have the expertise to thoroughly recognize and analyze these invoices and connect them to their economic and business risks. Coalitions provide outsourced expertise and give companies the opportunity to partner with state and national equality organizations that can bring their own resources. Through these partnerships, companies gain access to economic impact studies, public opinion data, analysis of submitted legislation, and peer information in other states that have gone through a similar process. This information helps them communicate a strong evidence-based argument against discriminatory legislation.
Ultimately, coalitions help their members develop a clear, unified message, which, in turn, makes their nondiscrimination case more powerful with legislators and the public. Together, these core functions of business coalitions on LGBTQ rights help build trust among business leaders, much-needed currency when these efforts become politically hot.
Although anti-discrimination protections for LGBTQ people are advancing in places like New York Y Virginia, advocates in the US still anticipate discriminatory bills introduced in multiple states, focused on religious exemptions, preemption of municipal anti-discrimination protections, and transgender rights. The data-backed economic case for nondiscrimination has the power to boost bipartisan support by decoupling the issue from partisan politics and providing cover for pro-business legislators representing socially conservative districts.
Nationally, and in individual states where pro- or anti-LGBTQ legislation is being proposed, businesses have a real opportunity to make a difference. They can join an existing coalition or, in the absence of such an effort, ask their local chamber of commerce, visitors bureau, or LGBTQ equality organization to lead the way by creating one. Once convened, or on their own, they can publish opinion pieces in local newspapers to sway public opinion, host educational sessions for employees, and make direct appeals to legislators based on economic and value-based arguments. . And when anti-discrimination legislation is passed, businesses can praise and celebrate these efforts as vital to investing in a forward-thinking, inclusive economy.
Equality work requires many voices, and the emergence of the business community as a major force for LGBTQ rights has changed the conversation. Business leaders and the coalitions that convene them will have an innovative role to play in 2019 and beyond, in the US and around the world. Business competitiveness, the economic strength of their operating environments, and their commitment to inclusion and diversity require them to stay the course.