June 13, 2023

Allyship Requires More than Rainbow Flags: How Businesses Can Act to Overcome Discrimination

In June 1969, a confrontation between police and LGBTQ+ protesters culminated in the Stonewall Uprising, a series of clashes and demonstrations that spanned six days. It wasn’t the first time police raided a gay bar. It wasn’t the first time LGBTQ+ people fought back. But this particular event fundamentally changed the nature of LGBTQ+ activism in the United States. In 1970, the first Pride march took place to commemorate the one-year anniversary of the Stonewall Riots — named for the Stonewall Inn, the club in New York City’s Greenwich Village where the protests began. Today, we continue this tradition annually in June to celebrate Pride Month. Yet with more than 75 anti-LGBTQ+ bills signed into law this year, we must do more to support the LGBTQ+ community. Declaring ourselves “allies” and posting a rainbow flag on social media for a month isn’t enough. With an entire population threatened, suppressed, and subjected to growing violence, businesses devoted to DEIB must place actions over words.

Stonewalled After Stonewall

The Stonewall Uprising was a tipping point for the Gay Liberation Movement in the United States. And since then, Pride Month has come to represent the positive impact that LGBTQ+ individuals have had on history locally, nationally, and internationally. And they have contributed greatly to our society, our economy, and our arts. 

With every company scrambling to adopt AI, and with investors giddy about the presumed economic gains from large language models, it’s not OpenAI’s Sam Altman they should be thanking but Alan Turing - the gay mathematician and computer scientist who began the earliest substantive work on developing artificial intelligence. He was also a key figure in breaking German Enigma codes during World War II, which hobbled the Nazi advance while giving the Allied Forces a much-needed upper hand. Despite his efforts, Turing was convicted of indecency in 1952 after the discovery of his relationship with another man. He was given a choice: prison or chemical castration. He chose the latter. 

Turing is just one of many influential LGBTQ+ individuals. And although folks are familiar with LGBTQ+ celebrities — figures such as Elton John, Anderson Cooper, Ellen DeGeneres, Sir Ian McKellen, Laverne Cox, Frida Kahlo, and countless others — the business world has had its fair share of LGBTQ+ leaders.

  • Tim Cook - CEO of Apple Inc.
  • Peter Thiel - Co-founder of PayPal and Founders Fund
  • Bob Witeck - Founder and President of Witeck Communications, Inc.
  • Martine Rothblatt - CEO of United Therapeutics
  • Jennifer Pritzker - Founder and President of the Pritzker Military Foundation
  • Inga Beale - Former CEO of Lloyd's of London
  • Mary Kay Henry - International President of the Service Employees International Union (SEIU)
  • Debra Johnson - Former President and CEO of Highmark Health
  • Sallie Krawcheck - CEO and Co-founder of Ellevest
  • Todd Sears - Founder and Principal of Out Leadership

Yet now, after nearly 55 years of progress, the legacy of Stonewall is in jeopardy of being stonewalled as more states seek to strip LGBTQ+ people of their rights, their identities, their opportunities, their health, and their contributions to our society and our economy. That’s the irony here, isn’t it? The enduring conservative stance — the prominent talking point for decades — has been one of fiscal responsibility, business growth, and economic advancement. And yet, some states are now willing to throw billions of dollars away to promote an ideology that boils down to exclusion and discrimination — a scenario with too many losses to count but no material wins. Let’s take a look at what’s playing out right now.

Historic “State of Emergency” for LGBTQ+ Americans Declared

On June 6, 2023, the Human Rights Campaign (HRC) — the nation’s largest lesbian, gay, bisexual, transgender and queer (LGBTQ+) civil rights organization — “officially declared a state of emergency for LGBTQ+ people in the United States for the first time in its more than 40-year history, following an unprecedented and dangerous spike in anti-LGBTQ+ legislative assaults sweeping state houses this year. A new report released by HRC today — LGBTQ+ Americans Under Attack — details more than 75 anti-LGBTQ+ bills that have been signed into law this year alone, more than doubling last year’s number, which was previously the worst year on record.”

HRC issued a national warning and created a guidebook for the LGBTQ+ community that includes health and safety resources, a summary of state-by-state laws, “know your rights” information, and resources designed to support LGBTQ+ travelers as well as those already “living in hostile states.”

Nadine Smith, CEO of Equality Florida, shared her perspective on the brewing crisis with HRC: “Our universities, once renowned for their talent and innovation, are witnessing a drain of exceptional educators and students who now seek refuge in places where academic freedom and excellence prevail over political indoctrination. Our state’s economy has lost over $1 billion as businesses and conferences withdraw their investment in our state. The assault on freedom is not limited to one state but permeates across America. The erosion of civil liberties by extremists to further their own political ambitions poses a direct threat to the health and safety of LGBTQ individuals.”

It’s not a publicity stunt or an overblown reaction. This year ranked the worst on record for anti-LGBTQ+ legislation:

  • More than 525 bills were introduced in 41 states.
  • Over 220 of these bills explicitly targeted transgender people.
  • Over 76 bills have been signed into law as of June 5, 2023 — more than any year on record, and more than double over last year.

Transgender, non-binary, and gender non-conforming youth in particular have been directly harmed by anti-LGBTQ+ legislation, losing access to life saving medical care, comprehensive and inclusive education, and activities, spaces, and facilities.

  • Transgender sports bans (21 states) — 30% of high school aged transgender youth — approximately 90,100 of the estimated 300,100 transgender youth aged 13-17 in the U.S. — are living in states where they are unable to simply play alongside their friends. As these bills extend all the way down into kindergarten and, in some states, through college, many more transgender youth and young adults are impacted as well.
  • Gender-affirming care bans (20 states) — 30.9% of all transgender youth aged 13-17 are living in states where they can no longer access life-saving, best practices medical care. In some states, care has been banned not only for youth, but adults as well, especially through bans on public funds going to provide this best practice healthcare. More than 30 states introduced gender affirming care bans during the 2023 legislative session, meaning that at its height, half of all transgender youth in the U.S. were at risk of losing access to gender-affirming care.

Economic Consequences

It’s gotten so bad that transgender people or parents with transgender children have been uprooting their lives to flee their home states. In Texas, for example, officials have announced their intentions to launch child abuse investigations involving people who provide gender-affirming care for their transgender children. State funds in Florida, including social support such as Medicaid and economic assistance programs, may not be used for gender-affirming care. Florida’s political battle with the Walt Disney Company could result in an upfront loss of $1.5 billion for the state’s economy. Anti-LGBTQ laws have a number of negative economic consequences for states — but no credible gains.

  • Reduced economic output: Studies have shown that anti-LGBTQ+ laws can reduce economic output by up to 1% by discouraging LGBTQ+ people from participating fully in the economy, such as starting businesses or working in certain industries.
  • Increased healthcare costs: LGBTQ+ people are more likely to experience health disparities, such as depression, anxiety, and substance abuse. These disparities can lead to increased healthcare costs for states.
  • Reduced tourism and business investment: Businesses and tourists may be less likely to visit or invest in states with anti-LGBTQ+ laws. This results in a loss of revenue for states. Travelers and event organizers may also choose to boycott or relocate conferences, festivals, and other major events, causing a loss in revenue for local businesses, hotels, and tourism-dependent industries.
  • Damage to the state's reputation: States with anti-LGBTQ+ laws will likely be seen as less welcoming and inclusive, which damages the state's reputation and makes it more difficult to attract talent and businesses.
  • Legal challenges and costs: Implementing and defending anti-LGBTQ laws can have legal repercussions that incur significant costs for states. This includes defending against lawsuits challenging the constitutionality of the laws, which may result in financial burdens and divert resources away from other public priorities.

Health Consequences

Anti-LGBTQ+ laws contribute to an environment of stigma, prejudice, and exclusion, which creates overwhelming physical and mental health challenges for LGBTQ+ individuals.

  • Mental health impact: Discriminatory laws exacerbate existing social stigmas and prejudices against LGBTQ+ individuals. This exacerbates the prevalence of mental health disorders such as depression, anxiety, and suicidality. When LGBTQ+ people face legal discrimination, it sends a message that they are not valued members of society, leading to increased stress, isolation, and a diminished sense of self-worth.
  • Limited access to healthcare: Discriminatory laws impede access to appropriate healthcare for LGBTQ+ individuals. Some laws enable healthcare providers to deny services or discriminate against patients based on religious or moral beliefs. This endangers people through delayed or inadequate medical care, including vital preventive services like HIV testing, hormone therapy, mental health services, or gender-affirming treatments. 
  • Increased risky behaviors: Anti-LGBTQ+ laws that marginalize individuals and limit their access to information or education can push them to engage in risky behaviors such as engaging in unprotected sex, substance abuse, or self-harm as a result of the stress and psychological impact of discrimination. 
  • Higher rates of violence: When discrimination is written into legislation, it not only isolates members of targeted groups but exposes them to environments that foster hate crimes, harassment, and violence. Experiencing or fearing physical violence has profound health consequences, including injuries, trauma, and long-lasting psychological effects. Discriminatory laws perpetuate a cycle of violence and harm against vulnerable populations.

Businesses Thrive with Inclusivity

Throughout our nation’s history, cycles of enforcing and conquering bigotry have charted our path. And throughout our history, even in times of accepted and far-reaching legalized discrimination, clever business leaders recognized exclusion as counterproductive. 

Discriminatory laws actually kill bottom-line profits. In 1960, a group of African American students staged a sit-in protest at a segregated Woolworth’s lunch counter in Greensboro, North Carolina. The protest garnered national attention and sparked similar demonstrations across the country. Overall sales at the time dropped by 20%. Profits got cut in half. Conversely, sales in the South’s desegregated companies soared. Within a year of the first protests, businesses across more than 100 towns and cities pushed to integrate. As a result, Woolworth’s eventually ended its discriminatory policy and allowed African Americans to be served at their lunch counters. This move contributed to increased sales and profitability for the company.

More recently, consider merchants in Mississippi, circa 2014. Bakeries, caterers, photographers, and other shopkeepers displayed messages warning LGBTQ+ consumers to take their cash elsewhere. And those customers did. Competing business owners, who posted signs welcoming all customers unconditionally, saw a hefty spike in sales. Smart business leaders understand the financial and communal benefits of embracing all people, even in the presence of legalized discrimination. Here are a few more examples.

  • The Case of The Green Book: During the era of racial segregation in the United States, the Green Book was a guidebook for African Americans to find safe establishments where they could eat, sleep, and shop. Some businesses recognized the economic opportunity in serving all customers and chose not to discriminate based on race. By doing so, they attracted a loyal customer base and thrived, despite discriminatory laws. Interestingly, the HRC guidebook mentioned earlier seems to have taken inspiration from this iconic document.
  • The Case of Marriott International: In the 1950s and 1960s, when racial discrimination was still prevalent in many parts of the United States, Marriott International, under the leadership of J.W. Marriott Sr., made a deliberate choice to welcome guests of all races in their hotels. This inclusive approach helped Marriott gain a competitive edge by attracting a broader customer base. Over time, the company grew to become one of the world's leading hotel chains.
  • The Case of Ben & Jerry’s: Ben & Jerry’s, the renowned ice cream company, has long been known for its commitment to social justice and inclusivity. In the late 1980s, when Vermont had no laws prohibiting discrimination based on sexual orientation, the company extended health benefits to same-sex couples. This move was considered progressive at the time and helped foster a positive brand image. Ben & Jerry’s continues to benefit from its reputation as a socially conscious business that values equality.
  • The Case of Starbucks: In 1983, Starbucks became the first national coffeehouse chain to hire transgender employees. This was a controversial move at the time, but it has since paid off. Starbucks has been praised for its diversity and inclusion initiatives, and it has been ranked as one of the best places to work for LGBTQ+ employees. Flash forward to n 1992, when Starbucks became the first national coffee chain to hire transgender employees. This was a bold move at the time, as discrimination against transgender people was widespread. However, Starbucks’ decision paid off. The company was praised for its diversity and inclusion efforts, and it gained a loyal customer base among transgender people and their allies.
  • The Case of Salesforce: In 2015, the state of Indiana in the United States passed the Religious Freedom Restoration Act (RFRA), which some viewed as potentially enabling discrimination against the LGBTQ+ community. Salesforce, a leading cloud computing company, took a strong stand against the legislation, threatening to reduce its investments in the state. This principled stance resonated with customers and employees who appreciated the company’s commitment to inclusivity. It not only preserved Salesforce’s brand reputation but also positioned the company as a leader in promoting equality.
  • The Case of Target: In 2016, Target announced that it would allow transgender customers to use the restrooms and fitting rooms that correspond with their gender identity. This was a groundbreaking move, and it was met with praise from LGBTQ+ advocates. Target has since seen an increase in sales and customer loyalty.
  • The Case of Nike: In 2018, Nike signed Colin Kaepernick to a multi-million dollar endorsement deal. Kaepernick is a former NFL quarterback who began kneeling during the national anthem to protest racial injustice. Nike’s decision to sign Kaepernick was controversial, but it has since been praised for its courage and commitment to social justice. Nike has seen an increase in sales and customer loyalty since signing Kaepernick.

Naturally, some will ask about the whole Bud Light boycott. Although it’s made a ton of headlines, the controversy has produced a slight dip in sales of about 1%. Moreover, the company’s full-year growth outlook for earnings before interest, taxes, depreciation, and amortization remains unchanged. Experts such as Brayden King, a professor of management and organizations at Northwestern University’s Kellogg School of Management, see the Bud Light drama as short-lived, inconsequential, and having no real impact on overall revenue. In fact, the Houston Chronicle reported that “Houston’s numbers are still going strong” even though social media would have us believe that every Texan has abandoned the beer.

What Businesses Can Do to Help

As discriminatory laws go into effect, businesses can play a crucial role in supporting LGBTQ+ people and fostering inclusivity. The staffing industry has staked much its reputation on championing DEIB initiatives. The industry is also large — about $218 billion large. I’ve made this noise before, but I truly believe the industry is missing an opportunity to unite and advocate for change

Our companies can engage in advocacy efforts by joining business coalitions, signing open letters, leveraging corporate influence, and even petitioning or lobbying lawmakers to support pro-LGBTQ+ legislation and fight against discriminatory laws. Participating in legal challenges or filing amicus briefs can also demonstrate a commitment to upholding equal rights. Here are just a few other examples of ways the industry can take action and help influence meaningful change.

  • Publicly express support: Issue statements or release public declarations expressing support for LGBTQ+ rights and equality. This demonstrates solidarity and helps create a safe environment for employees, customers, and the wider community.
  • Review policies and practices: Internally, with clients, and with supplier partners, evaluate existing policies and practices to ensure they are inclusive and supportive of LGBTQ+ individuals. This may involve updating non-discrimination policies, implementing gender-neutral dress codes and restroom policies, and offering equal benefits to all employees, regardless of sexual orientation or gender identity.
  • Provide inclusive training: Conduct training sessions to promote awareness and understanding of LGBTQ+ issues, including unconscious bias training. This can help foster a more inclusive work environment and reduce discrimination.
  • Offer resources and support networks: Establish resource groups or affinity networks for LGBTQ+ employees. These groups can provide a supportive community, offer mentorship opportunities, and help educate others within the organization about LGBTQ+ experiences and challenges.
  • Partner with LGBTQ+ organizations: Collaborate with local LGBTQ+ organizations to support their initiatives and events. This can involve sponsorships, donations, or joint awareness campaigns. Building relationships with these organizations can enhance the business's credibility and demonstrate a commitment to the LGBTQ+ community.
  • Offer support: Implement inclusive marketing strategies that represent diverse gender identities and sexual orientations. Display visible signs of support, such as inclusive signage.
  • Support LGBTQ+-owned businesses: Actively seek out and support LGBTQ+-owned businesses as suppliers or partners. This can help create economic opportunities and foster a more inclusive business ecosystem.

Even if we remove the humanitarian and social factors from the table, the simple business truth is that all people are potential customers, workers, and ambassadors for every company in America. Alienating them, for whatever reason, accomplishes little more than stunting corporate growth and weakening the economy.

Photo by Steve Johnson on Unsplash

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