Anti-LGBT laws push corporations to forefront of equality fight

Corporations — some with a new breed of CEO at their helms — are proving to be a potent force in combating a wave of state legislation threatening the rights of LGBT people across the U.S.

More than 100 companies have called for repeal of North Carolina's new 'bathroom law'

North Carolina's Republican Gov. Pat McCrory is running for re-election. He signed House Bill 2 into law the day it was passed. All in all, the process took less than 12 hours. On Tuesday, he walked some of its provisions back, but critics say he didn't go far enough. (H. Scott Hoffmann/News & Record/AP)

Corporate America is a term that doesn't often carry an especially positive connotation.

But big businesses — some with a new breed of CEO at their helms — are proving to be a potent force in combating a wave of state legislation threatening the rights of LGBT people across the U.S.

"I think at this moment in time, the business community has the most political capital, has the most weight behind it," said Deena Fidas of the Human Rights Campaign, a Washington, D.C.-based civil rights advocacy group, in an interview with CBC's The Current

Nowhere is this more evident than in North Carolina, where late last month the state legislature passed a deeply tendentious law that has backfired spectacularly.

The Public Facilities Privacy & Security Act, or House Bill 2, forces transgender people in any state building, including public schools, to use bathrooms aligned with the biological sex noted on their birth certificate.

On Tuesday, North Carolina Gov. Pat McCrory issued an executive order rolling back some of the provisions and allowing state agencies to "make reasonable accommodations upon a person's request due to special circumstances."

The order also states that local governments can make their own non-discrimination employment policies — an attempt to walk back some of the original provisions restricting the rights of cities and counties to enact their own anti-discrimination laws.

The local branch of the American Civil Liberties Union called McCrory's order "a poor effort to save face" and said it will proceed with the lawsuit it filed challenging House Bill 2.

'Bathroom laws' exist in several states

So-called bathroom laws, as well as anti-gay "refusal of service" laws, have been introduced or passed in more than 20 states since the U.S. Supreme Court ruled last summer that the constitution guarantees a right to same-sex marriage.

According to the Human Rights Campaign, more than 130 businesses have now publicly called for North Carolina to repeal its bill. The effort started with an open letter from the group to McCrory, which was signed by 80 CEOs from across the business spectrum. 

Among the corporations that have joined the campaign are the financial titan Bank of America, with more than 15,000 employees in the state, and American Airlines, which has a hub in Charlotte and employs thousands of people there.  

Some companies went further than just voicing opposition. Paypal bailed on plans to build a $3.6-million US operations centre that brought 400 jobs with it. Deutsche Bank announced this week it is freezing plans to expand its North Carolina operations.

'CEO activism'

It's difficult to quantify the total cost to the state of such actions, but simply put, the law is bad for business because "the reputational damage can be very real," says Timothy Werner, an assistant professor at the McCombs School of Business at the University of Texas at Austin. 

"The biggest hit will come from businesses already in North Carolina that decide not to expand any further in the state, and also among young people and immigrants who may choose to avoid living and working there," he said. 

Support for the law comes largely from socially conservative elements of the North Carolina GOP. Some voters were angry after the state's governor vetoed a bill last year that would have allowed some court officials to opt out of officiating gay marriage ceremonies. (Gerry Broome/AP)

The recent tensions come at a time when CEOs of some very identifiable brands are taking vocal public stands against socially regressive policies — a trend that Maurice Schweitzer calls the "rise in CEO activism."

"Even just years ago, their job was generally just to steer the company. There was no meddling in the politics of social issues. But now, that's actually part of the brands themselves," said Schweitzer, a professor at University of Pennsylvania's Wharton business school.

Pressure from business has played a part in battles like North Carolina's in other socially conservative states such as Georgia, Arkansas, North Dakota, South Dakota and Arizona. 

"For a lot of these CEOs," said Fidas, "LGBTQ issues are no longer some abstract social issue. They have faces; they have voices. They're neighbours; they're colleagues."

Of course, these are still businesses, and bottom lines matter. But in the case of anti-LGBT measures, there is little for corporations to lose by taking a stand. A majority of the U.S. public say they support marriage equality and protection from discrimination for LGBT people in and outside the workplace. 

Werner also points out that the progressive policies of some corporations have outpaced those of state and federal governments, and in some cases outpaced public attitudes on the social issues at the heart of those policies.

As of 2014, for example, 91 per cent of Fortune 500 companies had given employees protections on the basis of sexual orientation in their non-discrimination policy. Nearly 61 per cent offered protections on the basis of gender identity. 

"It's really a relatively low-cost issue for business to engage on," he said. 

But corporate protest hasn't been entirely successful in shaping public policy. In July, Mississippi's version of a "bathroom law" that targets transgender people will take effect. It will also allow foster parents to force LGBT youth to undergo so-called conversion therapy.

And the governor of Tennessee is expected to sign two separate bills in the coming days, both of which have been called discriminatory, despite criticism from industrial giants like Dow Chemical and HP.

The right side of history

North Carolina has also been defiant. McCrory, a Republican, said earlier the state "has been the target of a vicious, nationwide smear campaign."

He's running for re-election in the fall.

Bruce Springsteen recently cancelled a show in North Carolina in protest of the law. His fellow rocker Bryan Adams also bailed on a concert in Mississippi over a state law that allows some religious groups and private businesses to refuse service to gay couples. Many large corporations have also spoken out against such measures. (Ilya S. Savenok/Getty for Academy of Motion Picture Arts and Science)

Early last year, McCrory came under fire from within his own party after he vetoed a bill that would have allowed some court officials to refuse to marry gay couples in the state. Both houses of the state's General Assembly voted to override the veto.

House Bill 2 — which Schweitzer calls an appeal to "reactionary forces" within the Tar Heel state who have struggled to adapt to a "rapid period of social change" — was introduced, deliberated, passed and signed in less than 12 hours last month. 

There is little chance the bill will be repealed before the election. 

Schweitzer says a string of "messy lawsuits" challenging anti-LGBT measures will make their way through the courts over the coming months. 

But the corporations that have spoken out against North Carolina's law and others like it have found themselves "on the right side," of this particular issue, according to Schweitzer.

"Both in terms of their brand, and history."

About the Author

Lucas Powers

Senior Writer

Lucas Powers is a Toronto-based reporter and writer. He's reported for CBC News from across Canada. Have a story to tell? Email lucas.powers@cbc.ca any time.

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