The Corporate Struggle For LGBTQ+ Rights


As the calendar turns to June, Pride Month 2023 begins, a time of celebration, reflection, and advocacy for the LGBTQ+ community. This year, the corporate world finds itself at a crossroads, with companies like Nordea and Target, among many others, navigating the complex terrain of LGBTQ+ rights and corporate social responsibility.

Nordea, a leading Nordic bank, has embraced the rainbow, partnering with Pride, and raising flags across its premises. This commitment to diversity and inclusion extends beyond symbolic gestures, with an internal network of LGBTQ+ employees and allies fostering a culture of respect and belonging. Across the Atlantic, US retailer Target has also sought to celebrate Pride Month, launching a collection of LGBTQ+ merchandise designed by artists and designers from the community. However, the reception to Target’s initiative has been markedly different from Nordea’s experience.

While Nordea’s partnership with Pride has been met with largely positive feedback, Target has faced a severe backlash. Some customers have confronted workers in stores, knocked down Pride Fmerchandise displays, and posted threatening messages on social media. In response, Target has removed some products that have been at the centre of the most confrontational behaviour from its stores and website, citing employee safety and well-being as the reason for this decision.

This stark contrast in reactions to Nordea’s and Target’s approaches to LGBTQ+ rights underscores the influence of different markets and cultures on the acceptance of corporate social responsibility initiatives, particularly on so-called “contested” or “polarizing” issues. Nordea operates in Nordic countries where LGBTQ+ rights are generally well-protected and respected by law and society. In contrast, Target operates in the US, where LGBTQ+ rights are more contested, politicised, and more recently, under direct attack.

In fact, the controversy surrounding Target’s Pride Collection is a microcosm of a larger cultural war that has been playing out across the country, instigated by right- and extreme-right-wing Republicans. The recent dispute between Disney and Florida Governor Ron DeSantis is another prime example. The dispute began after DeSantis passed a “don’t say gay” law in March 2022, banning classroom teaching on sexual orientation and gender identity. In response, Disney, Florida’s second-largest employer, sued DeSantis in April 2023, escalating the feud between the entertainment giant and the governor. By May 2023, Disney puled the plug on an office complex that was scheduled for construction in Orlando at a cost of roughly $1 billion.

Disney’s actions are commendable and courageous. By taking a robust stand against a law that undermines the rights of the LGBTQ+ community and against a Governor who is relentlessly attacking the community, Disney is demonstrating the power and influence businesses can wield in shaping the legal and social environment in which they operate. This is a lesson that Target, and indeed all corporations, can learn from.

Taken together, the experiences of Nordea, Target, and Disney highlight the risks and rewards of corporate advocacy for LGBTQ+ rights. Nordea’s partnership with Pride has bolstered its reputation as a responsible and inclusive bank. Disney’s legal battle with DeSantis has demonstrated its commitment to equality, even in the face of fierce and populist political opposition. Target, on the other hand, has faced a potential loss of sales and customer loyalty due to its LGBTQ+ merchandise, but it has also earned praise for its diversity and inclusion efforts.

Even though capitulating on LGBTQ+ rights – as Target has subsequently done – may seem pragmatic in the short term, it certainly carries long-term consequences. It erodes credibility, trust, and loyalty from customers, employees, and stakeholders who value LGBTQ+ rights. It also fails to uphold the human rights standards recognized by international law and many national constitutions.

The debate between pragmatism and ethics in business is not new. Some argue that businesses should adapt to their legal and social environment, avoiding controversy and potential losses. Others, however, argue that businesses have a moral duty and social responsibility to uphold human rights standards, regardless of their sexual orientation, gender identity, or expression.

In my view, businesses cannot and should not compromise on human rights. Instead, they should strive to uphold them in all their operations and interactions. This is not only the right thing to do, but it is also the smart thing to do. Companies that champion these rights foster a more engaged and satisfied workforce, attract, and retain a diverse pool of talent, and cultivate loyalty among customers who value inclusivity. This commitment to diversity fuels innovation and creativity, enhances the company’s reputation and brand image, and mitigates potential legal and reputational risks. Above all, by standing up for LGBTQ+ rights, businesses can drive social change and contribute to a more inclusive and equitable society.

As we enter Pride Month 2023, let us remember the importance of standing up for what is right, even in the face of adversity. Let us celebrate diversity, champion inclusion, and continue to advocate for the rights of the LGBTQ+ community. It is not just about raising rainbow flags or selling merchandise; it is about making a real difference in people’s lives. That is the true spirit of Pride.

Ioannis Ioannou, Associate Professor of Strategy and Entrepreneurship, London Business School

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