If the recent Bud Light boycott taught us anything, it’s that customers don’t like to swallow a political agenda along with their light beer.
After Anheuser-Busch stocks plummeted and the company could barely get people to drink Bud Light for free, you’d think other corporations would get the hint to steer clear from divisive cultural topics.
But major companies have once again bent over backwards to show their support for “Pride Month.” Target’s rollout of a special line of “Pride” apparel for children led to a net loss of $10 billion in stock market value. And the Los Angeles Dodgers’ re-invitation of an infamous drag group that mocks Catholic nuns to honor them at the team’s Pride Night resulted in protests and no small amount of negative media coverage.
Though the Wall Street Journal reports that some companies are “rethinking” their strategies, most companies are continuing to plunge forward despite the negative feedback. Why are America’s major brands continuing to march leftward even amid protests?
The answer is that corporations are effectively held hostage by powerful asset managers—like Blackrock, Vanguard, and State Street—who demand that they adhere to an environmental, social, and governance (ESG) agenda. In order to earn the stamp of approval from these powerful shareholders, companies participate in scoring systems created by left-wing organizations who set the agenda for how they respond to cultural issues.
These organizations require complete fealty—with no room to question the methods or demands and no forgiveness if you deviate even a little from their program.
We see this toxic cycle play out in the new requirements of the Human Rights Campaign’s Corporate Equality Index (CEI). Even though the CEI preceded ESG in time, it has become a bellwether for whether companies are living up to the social justice agenda represented by the “S” in ESG.
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HRC began rating companies on how their policies and practices serve the LGBTQ movement in 2002. At first, a perfect score on HRC’s index meant a company held nondiscrimination policies and offered healthcare benefits to employee’s same-sex partners. Yet, over the years, as more companies complied with these requirements, HRC ratcheted up its demands.
Now, HRC moves the goalposts each year in a way that commits companies to some of the most radical political goals of LGBTQ activists to maintain a perfect score. For example, to earn 100% this year and the coveted “Best Place to work for LGBTQ Equality” title, HRC is demanding that companies cover “puberty blockers for youth” in their healthcare plans.
Most Americans strongly oppose providing puberty blockers to minors. The Washington Post recently reported that “[n]early 7 in 10 adults said they oppose allowing children ages 10 to 14 access to medication that stops the body from going through puberty, and nearly 6 in 10 oppose giving 15- to 17-year-olds access to hormone treatments.” Yet HRC is demanding that companies stake out one of the most extreme positions on one of the most controversial and polarizing topics of the day.
Put another way, they are demanding that each company risk becoming the next Anheuser-Busch.
HRC does not care about the success of the businesses it scores. It only cares if those businesses do its political bidding. When Anheuser-Busch issued a soft apology for the disastrous Bud Light marketing campaign with Dylan Mulvaney, HRC threatened to suspend its 100% score and remove its title, simply because the company did not respond in a manner that HRC approved. HRC makes very clear that there is no room for dissent, even if the group’s agenda tarnishes a company’s brand and destroys its profits.
Corporate leaders should not accede to activists’ demands for uniformity in thought and action, nor blindly pursue a political ideology. Instead, they should work for the good of their employees, customers, and shareholders by scaling back their political activism and cultivating respect for diverse religious and political views internally and externally.
Understanding this, Alliance Defending Freedom developed the Viewpoint Diversity Score Business Index. The first comprehensive benchmark designed to measure corporate respect for free speech and religious freedom, the index measures companies’ commitment to respecting fundamental freedoms.
Unlike HRC, ADF doesn’t demand that companies weigh in its side of the cultural issues of the day. Instead, it offers them the alternative of respecting timeless First Amendment principles and developing policies and practices informed by them. Recognizing that we all have different beliefs, this framework encourages companies to simply respect people’s freedom to speak their mind and to live according to their conscience.
Obviously, disagreements will arise within companies and in the broader public square. But those disagreements need not lead businesses to alienate consumers and lose out on shareholder profits by going all-in on one side of today’s most divisive issues.
America’s corporations must break free from the stranglehold of ESG and far-left activist groups like HRC. The Viewpoint Diversity Score Business Index can set them free. It urges companies to provide their products and services on a viewpoint-neutral basis and to treat employees and vendors ethically, with dignity and fairness, and without regard to their religious or political views.
That won’t just protect freedom; it’ll also protect brands from becoming the next Bud Light.
Jeremy Tedesco is senior counsel, senior vice president of corporate engagement for Alliance Defending Freedom (@ADFLegal).
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