Silent but Steady Increasing Funding Flows into LGBTQ Causes as Companies Embrace Pride

CoinDesk reported:
At the 2024 Kentucky Pride Parade held in Louisville, Kentucky on June 15, 2024, participants are seen parading. Stephen J. Cohen | Getty Images
Pride Month is coming to an end – this year, the corporate world has taken a more cautious approach. June often brings a wave of rainbow-themed products, retailers, and consumer brands affirming advertisements and social media posts in conjunction with celebrations of LGBTQ+ community parades and other events. However, as the presidential election nears, some companies are becoming increasingly silent on efforts of diversity, equity, and inclusion to avoid getting involved in a culture war like Target and Budweiser did a year ago or facing backlash from conservative customers.
The most notable example surfaced late on Thursday: Tractor Supply, a retailer that sells animal feed, cowboy boots, and lawn supplies in rural areas across the country, announced it will terminate all spending related to diversity and environmental causes. The statement mentioned this includes no longer sponsoring Pride events. While this move is an outlier in scale, it highlights how some companies that have made commitments to inclusivity in recent years are proceeding with caution. It’s harder to track how many companies in June compared to previous years have shared support messages, donated to LGBTQ+ causes, or sold rainbow-themed products. According to data from the Washington, D.C.-based reputation research company Gravity Research, as of June 21 this year, 45% of the Fortune 100 companies had at least one social media post explicitly related to Pride on LinkedIn or X, compared to 51% last June. Gravity Research President Luke Hartig said the volatility of the presidential election and the willingness of the two candidates to name companies also make it less likely for companies to publicly state their position. He said, “It’s a bit like, ‘Keep your head down while we go through this election.'”
Tim Bennett, co-founder of Tribery Productions, a marketing company specializing in reaching LGBTQ+ Americans, working with Fortune 500 companies, including recent projects with Procter & Gamble, said more and more clients are taking a “wait and see” approach to marketing to LGBTQ+ consumers, or deciding to spread their efforts throughout the year rather than making a splash in one month. Bennett said, “This June is different from the past five or six months.”
For LGBTQ+ initiatives and charities, this may not be a bad thing. Sarah Kate Ellis, CEO of the non-profit advocacy organization GLAAD, said she sees more and more companies getting involved in year-round charitable work and activism in a more meaningful way. She also pointed out that a survey by Gravity Research found that 78% of companies do not plan to change their Pride strategy this year. 13% are unsure if they will make changes, and 9% plan to modify their strategy. Gravity Research surveyed 45 corporate executives and industry leaders from Fortune 500 companies in April. Ellis said, “It’s very important that companies fly the flag and roll out products to celebrate our pride and commemorate a very important month for our community. However, I do think that these companies have to look inward and make sure that their policies and HR practices match their external marketing.”
Big corporations are still writing checks for LGBTQ+ causes. A spokesperson for GLAAD said on Friday that the organization has not seen a decrease in donations or corporate support this Pride Month, although the total number is not yet available. On Friday, the opening of the Stonewall National Monument Visitor Center, commemorating the New York City bar that catalyzed the LGBTQ+ rights movement, received strong support from the business community. Supporters included Google, Amazon, JPMorgan Chase, and Booking.com. President Joe Biden also attended the opening and delivered a speech.
On May 31, 2023, Pride Month merchandise is displayed at a Target store in San Francisco, California. Justin Sullivan | Getty Images
Sprouts and Target Effect
Gravity Research’s survey shows that major consumer brands are most likely to indicate that they plan to change their “Pride Month” strategy this year. This may stem from the conservative backlash against Target and Budweiser last year. Target has had a Pride collection for over a decade. However, last year, the retail giant removed some products and shifted displays after employees faced threats. Critics targeted products for transgender shoppers, such as “intimate” swimwear, and also criticized standalone Pride products for children. This year, Target did not sell Pride merchandise at all stores, only at the 10% of stores that accounted for 90% of Pride total sales in 2022 and 2023. It also stopped selling any children’s Pride apparel. A variety of Pride-themed merchandise can be found on the company’s website and in these select stores. A Target spokesperson said the external and internal negative feedback volume for this year’s Pride collection was “significantly lower” than in 2023. In a statement, Target said it is “committed to supporting the LGBTQIA+ community during Pride Month and throughout the year” by not only offering Pride products but also participating in Pride events nationwide to support the LGBTQ+ community.
On April 21, 2023, a sign derogating Budweiser beer is seen on a rural road in Arco, Idaho. Brewers of Budweiser, Anheuser-Busch, faced strong opposition for sponsoring two posts on Instagram by a transgender person. Natalie Behring | Getty Images
On the other hand, Anheuser-Busch InBev and other major beer brands have shied away from public support for the LGBTQ+ community. Conservative figures such as singer Kid Rock and Florida Governor Ron DeSantis called for a boycott of Budweiser and its parent company Anheuser-Busch InBev after Budweiser sent personalized beer cans to transgender influencer Dylan Mulvaney. The marketing campaign coincided with the March Madness college basketball tournament. Bud Light’s sales plummeted by about 25%, losing its position as America’s top-selling beer brand to Constellation Brands’ Modelo for the first time in over 20 years. Anheuser-Busch InBev distanced itself from Mulvaney and fired Budweiser’s marketing vice president. In October, Anheuser-Busch InBev CEO Michel Doukeris said the brand will focus more on marketing at sports games and concerts. It also returned as the official sponsor of UFC. In recent months, some consumers have returned to Budweiser, with European analysts estimating the brand’s sales in the U.S. have only dropped by about 10% recently. Bud Light has not posted any Pride Month support messages on its Instagram or X pages this year. Neil Reid, a geography professor at the University of Toledo who studies the beer industry, said the backlash was unusually intense for several reasons. Reid said research shows consumer loyalty to top-selling beers may be more about the brand than the taste. Right-wing news media like Fox News also gave a lot of airtime to the controversy, prolonging its duration and potentially reaching new consumers who missed the initial reaction. Additionally, as Budweiser’s sales declined, retailers gave more shelf space to competitors. Reid said, “You can look at this issue from a moral, ethical standpoint, or you can look at it purely from a business standpoint. These two often don’t produce the same strategy.”
The New York Stock Exchange welcomes e.l.f. Beauty (NYSE: ELF) to the podium on March 18, 2024, to celebrate its 20th anniversary. To commemorate the occasion, Chairman and CEO Tarang Amin and Tara Dziedzic, Head of the NYSE American Listings, rang the Opening Bell.
Doubling Down on Diversity
While some companies are becoming more cautious about promoting diversity efforts, others are stepping up their inclusivity initiatives. For example, in mid-May, E.l.f. Beauty launched a provocative advertising campaign called “So Many Dicks.” These ads appeared on prominent billboards in New York City, highlighting the abundance of men named Dick (including Richards, Richs, and Ricks) compared to the underrepresented group as a whole. It also included video clips with athletes and social rights activist Billie Jean King. The beauty brand is one of only four publicly traded U.S. companies with a board that is two-thirds women and one-third people of color. E.l.f. Beauty CEO Tarang Amin said the brand’s core audience, especially Gen Z consumers, wants brands to stand up for causes they support. He noticed that corporate leaders are less willing to speak out than in the past. He said, “Our values are one of the true differences between E.l.f. and what our community expects.” Amin added, “If you don’t stand up for what you truly believe in and leave just because you’re afraid of what someone might push back, I think you’re missing an opportunity to make a difference in the world.” Amin said the company’s stock performance shows that its diverse board and inclusive messaging are also boosting its bottom line. E.l.f.’s stock has risen by about 46% this year, outperforming the S&P 500’s gain of about 15%. Elsewhere in the business world this year, Pride activities continue. Skittles is selling limited-edition Pride packaging rainbow-colored candies as it has done for the past five years. The brand, owned by Mars Wrigley, donates $1 for each Pride pack sold to GLAAD, up to a maximum of $10,000, with a matching donation of up to $25,000. In June, Macy’s highlighted brands owned, founded, and designed by LGBTQ+ people on its website, as well as at Bloomingdale’s and Bluemercury. Over the past five years, the department store raised over $6.2 million for the Trevor Project, a non-profit organization supporting LGBTQ+ youth in preventing suicide. GLAAD’s Ellis said she is encouraged by continued support from companies and that they “stand on the right side of history.” But she said there’s still work to be done, especially in supporting the transgender community. Politicians nationwide have proposed bills restricting gender-affirming care and transgender rights. Gravity Research’s Hartig said companies have backed off including them in marketing after conservatives targeted them in political campaigns and last year’s Pride Month. But not all pushback against corporate diversity, equity, and inclusion efforts has received the support activists hoped for. Rockville, Maryland-based corporate data and analytics provider ISS Corporate said there was a significant increase in opposition to environmental, social, and governance proposals. At meetings for the Russell 3000 companies held from January 1 to June 30 this year, there were 83 votes on proposals opposing ESG, up from 55 at the same time in 2023 and 37 in 2022. However, the median support rate has been declining each year, with a median support rate of 1.5% in 2024, compared to 1.7% in 2023 and 2.9% in 2022. CNBC’s Amelia Lucas contributed to this report: CNBC is owned by Comcast NBCUniversal, which is one of the corporate sponsors of the Stonewall National Monument Visitor Center.