World

Corporations threaten to pull out of states over transgender bathroom law

Corporations are pushing back by withdrawing their business as U.S. states such as North Carolina and Mississippi adopt policies allowing discrimination against gay, lesbian and transgender people.

In Georgia, the governor refused to sign law after Disney, AMC say they'll walk

AMC series The Walking Dead is filmed on location in Senoia, Ga. Georgia's governor reversed a law that would have allowed discrimination against LGBTQ people after producers said they'd pull out of the state. (Gene Page/AMC/Canadian Press)

It wasn't the fear of The Walking Dead marauding on the streets that did it. It was the fear they'd leave.

The popular AMC show, which is filmed in the Peach State, joined Disney and Marvel in vowing to leave if Georgia went through with a law allowing faith-based organizations to discriminate against gay, lesbian and transgender people.

The threat worked. Though the Republican-dominated legislature passed the bill, the governor refused to sign it after hearing of Hollywood lining up against it.

Dozens of states have their own versions of the law on the books – or are considering it. North Carolina's own attorney general calls House Bill 2 a "national embarrassment."

Among other things, it would require transgender people to use the bathroom associated with the gender on their birth certificate. Meaning someone living as a woman, who may have even undergone gender re-assignment surgery, would legally be required to use the men's bathroom.

What does 'faith-based' mean?

The laws are often called Religious Freedom Restoration Acts. They're to protect those opposed, for instance, to same sex marriage from having to perform one.

They are typically limited only to "faith-based" organizations. But no definition of faith-based exists, so a motel with a cross in the office or a restaurant run by a devout Christian family could legally refuse to serve a gay couple.

But now there are consequences – and they're coming from some of the biggest names in corporate America.

Apple, Amazon, Google, Target, Monsanto, Unilever, Intel and about 60 more. The Business Coalition for the Equality Act consists of companies that operate in all 50 states, have a combined $1.9 trillion in revenue and employ more than 4.2 million workers. And they're not afraid of making threats. Nor do they worry about a backlash, since they're doing it together.
Protesters call for Mississippi Gov. Phil Bryant to veto House Bill 1523, which they says will allow discrimination against LGBT people, during a rally on April 4. (Rogelio V. Solis/Associated Press)

For the first time this year, the World Economic Forum held a session on the power of corporations to advocate against regressive LGBTQ laws.

Talking LGBTQ rights at Davos

"Our corporate economies are bigger than the economies of some countries," Beth Brooke Marciniac of Ernst and Young told the Davos forum, "and I think we understand both the obligation and the importance of speaking out".

The message to Georgia was simple, says Marciniac: "you pass that bill and we will leave your state."

Only a month ago, North Carolina's governor was on hand when PayPal announced 400 jobs for Charlotte, part of a new global operations centre. But the law changed the company's plans — and it's now building elsewhere. Hulu's new series Crushed also left North Carolina and will film in Vancouver instead.

So why do it? What's in it for these global firms?

"I think they're doing this because it's right, and corporations want to be on the right side of good," Laurence Bernstein says. The managing partner of Toronto's Protean Strategies has advised companies on how to market to and for the LGBTQ community.

LGBTQ buying power

Then there's buying power. While research numbers vary, one marketing company, Protean Strategies in Toronto, suggests gays and lesbians in Canada could have collective incomes of $98 billion and a larger percentage of that is disposable income compared to other people. In the U.S., Protean Strategies suggest collective disposable income could be nearly 10 times larger.

But the United States also has powerful economic forces working against greater LGBTQ rights. When JC Penney made Ellen DeGeneres its spokesperson, the Million Mom organization rallied against the department store, arguing it was celebrating a lesbian and questioning the choices and morals of both the company and the talk show host.

Bernstein points out companies also have their own employees to think about. "They have a diverse employee base and they have a diverse pool of talent they can recruit from and they don't want to be seen as being on the wrong side of right. It's going to affect their ability to recruit the right talent."

Clarifications

  • This story has been updated to explain that the numbers provided on the income levels of gays and lesbians in Canada comes from one source -- a marketing company called Protean Strategies in Toronto. The story now reads: While research numbers vary, one marketing company, Protean Strategies in Toronto, suggests gays and lesbians in Canada could have collective incomes of $98 billion and a larger percentage of that is disposable income compared to other people. In the U.S., Protean Strategies suggest collective disposable income could be nearly 10 times larger.
    Jun 13, 2016 12:03 PM ET

Corrections

  • An earlier version of this story said PayPal had announced 400 jobs for Raleigh, N.C. In fact, the jobs were planned for Charlotte.
    Apr 11, 2016 9:37 AM ET

About the Author

David Common is a host & senior correspondent with CBC News.

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