By Jennifer Williams
The conservative activist who pushed Tractor Supply, Lowe's and other companies to abandon their diversity efforts says he is preparing a new list of targets, arguing that a Trump victory supports such a reckoning.
"No industry should feel safe," said Robby Starbuck, the former Hollywood director-turned-activist. "As we head into Christmas, I will likely turn my sights to retailers who depend on the majority of Americans who just elected Trump with the popular vote."
Starbuck added that companies need to revert to the philosophy "that the customer is king."
Roughly 15 companies already have felt the heat of his attacks, and all have announced retreats from their diversity, equity and inclusion policies in response, he said. Farm-equipment seller Deere said in July that it would dial back some of its DEI initiatives after online pressure started by Starbuck, including by ensuring the absence of what it described as "socially motivated messages" from company-mandated training materials and policies unless otherwise required.
A month later, motorcycle maker Harley-Davidson announced changes such as scrapping spending goals to buy from suppliers owned by minorities or women following Starbuck's criticism that the company has supported LGBTQ causes and shown a "total commitment to DEI policies."
Starbuck's activism led Tractor Supply, which has for the past few years talked about its commitment to DEI targets, to scale back diversity efforts within weeks. The rural retailer this summer retired its DEI goals, eliminated related job roles and withdrew its environmental initiatives, including carbon emission targets, because of the social-media blitz started by Starbuck. The company will also no longer submit data to the Human Rights Campaign, an LGBTQ+ advocacy group.
It was a "tough decision to be made," said Kurt Barton, chief financial officer of Tractor Supply. "The social activism...really ended up creating some sense or perception that our goals, or our targets or anything that was occurring, had a political or social agenda to it," he said.
Tractor Supply executives and the company's board looked at the criticism stemming from Starbuck's campaign and determined that the chain, which boasts many customers in regions that tend to vote for more conservative political candidates, needed to take a strong stance. Any perception that policies were politically driven was removed, Barton said.
Starbuck's provocations come as companies face increased pushback against their diversity policies and initiatives. Bud Light lost its spot as the top-selling beer in the U.S. last year after controversy over a social-media promotion with a transgender influencer caused a boycott from some shoppers. Target's sales fell last summer after criticism over how the retail giant handled Gay Pride month displays.
Companies are gearing up for still more scrutiny of their DEI policies, in part from activists and through shareholder proposals, said Jason Schwartz, a partner at law firm Gibson, Dunn & Crutcher. Pressure is also mounting through litigation, he said. A Supreme Court ruling last year that ended affirmative action in U.S. colleges opened companies up to lawsuits over their hiring and personnel decisions. The high court's decision last month to hear a reverse discrimination case may further "open the floodgates" for disputes in court about companies' DEI policies, according to the lawyer.
"The tide is growing," Schwartz said.
In response to the heightened criticism, companies have reshaped DEI grants and other aid programs, laid off chief diversity officers and scrapped diversity goals. Some are scrubbing their websites, annual reports or earnings calls of mentions of green and social initiatives.
Companies are also reviewing their programs and the way they talk about them, Schwartz said. A business with an internship program focused specifically on race, for example, might broaden the eligibility criteria, he said. Or executives will decide to pull down older communications that are perceived to leave companies open to attack.
"They're reframing some of their programs and the way they talk about them," Schwartz said. "But they're not completely abandoning their efforts."
This is where Tractor Supply has landed, analysts said.
Tractor Supply announced its DEI policy changes in late June, revoking environmental, social and corporate governance initiatives launched a few years ago. By then, the company had touted achievements such as spending roughly 836,000 hours in 2023 on talent development and training meant to give workers a sense of inclusion and had around 49% of women in its workforce, Tractor Supply said in its latest annual ESG report. As of the end of 2023, the retailer had roughly 50,000 employees, according to a regulatory filing. Tractor Supply's stewardship page outlining the retailer's sustainability strategy has been removed from its website.
Even as Tractor Supply's DEI policies have been removed, the company's focus on a diverse workforce and inclusivity remains part of the company's mission and values, Barton said. "Tractor Supply is exactly who we've always been, which is a very values-based business."
Activist Starbuck says the aim of his attacks is to make sure companies' internal policies and practices aren't influenced by what he calls divisive social and political issues. And that businesses focus on what most consumers want. The election of Trump, who is working to curb what he views as left-leaning tendencies, fortifies the approach, Starbuck said.
"We want a consumer environment where no one feels like their values are being trampled on when they spend money with a public company," he said. "This election was a referendum on wokeness and DEI."
Write to Jennifer Williams at jennifer.williams@wsj.com
(END) Dow Jones Newswires
November 14, 2024 14:48 ET (19:48 GMT)
Copyright (c) 2024 Dow Jones & Company, Inc.
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