Are Marriage Equality Endorsements Bad for Investors?

When Chick-fil-A President Dan Cathy told a reporter that he supported the "biblical definition of the marriage unit," it was a shot heard 'round the world. In addition to the reactions from activist groups and non-activist consumers, corporations large and small have jumped into the fray by showing their support of marriage equality. But will such demonstrations hurt their bottom line?

Good politics or bad business?
Value-focused consumerism is not a new concept. Environmentally conscious consumers drove the proliferation of natural and organic products. Socially responsible investors actively search for stocks that meet their screening qualifications. A company's policies, lobbying activities, and conservative or liberal leanings, once made public, are all fair game for customers and investors who care about such things. (And some don't.)

In the days following the Chick-fil-A episode, Amazon.com (Nasdaq: AMZN  ) CEO Jeff Bezos and his wife pledged $2.5 million toward the fight to legalize gay marriage in Washington state. General Mills (NYSE: GIS  ) CEO Ken Powell has publicly stated the company is against a gay marriage ban up for vote in Minnesota, saying the ban is not in the best interests of the company's employees or Minnesota's economy. And Target, (NYSE: TGT  ) , which from the earliest days has positioned itself as a community-focused chain, has launched a series of ads welcoming same-sex couples to the company's wedding registry.

The few, the angry, the loud
A group calling for a boycott of General Mills garnered 8,000 local signatures, a very small drop in a very large, multinational bucket. Even if those 8,000 people earnestly attempted to boycott General Mills, can anyone truly boycott every item made by the giant company?

On the other side of the issue are companies like Marriott (NYSE: MAR  ) , whose CEO, Bill Marriott, recently retired. Marriott spoke with BusinessWeek about his strong Mormon values, and how he made the distinction between his personal values and the needs of an international corporation. One significant difference between Cathy and Marriott, of course, is that Marriott had already left the company when the interview ran.

What this means for a diversified portfolio
Will companies coming out in support of marriage equality hurt investors? It hasn't hurt General Mills. When posting quarterly earnings, Powell said there had been no noticeable impact in the company's sales since the announcement. In fact, the stock price rose in the days following. A Web search for "Amazon backlash" turned up very few comments about the donation. More people were upset about last year's Amazon app malfunction.

In the months leading up to election season, both local and federal, we can expect to see more shows of support for and against marriage equality from a variety of large and small corporations, as well as personal endorsements from CEOs that don't reflect a company's policy.

Investors can breathe easy. Such statements and donations aren't PR disasters. They're not product recalls, or labor disputes. And most importantly, they're not surprises. Any investor who has done his or her research before buying a stock will know not only the basics of the balance sheets, but the general ethics of the company. And if a company's ethics are important to you, you'll know what they are before you buy your first share.

Don't worry about who's saying what between now and the election; worry about which companies will thrive, and fall, depending on who's in office. We have and prepared this special report, "These Companies Could Skyrocket After the 2012 Presidential Election." Download a copy today on us; it's free for Fools.

Do you make buying or investing decisions based on a company's values? Tell me about it below.

Molly McCluskey owns shares of Amazon and Starbucks. Follow her travel and finance tweets on Twitter @MollyEMcCluskey. The Motley Fool owns shares of Starbucks and Amazon.com. Motley Fool newsletter services have recommended buying shares of Starbucks and Amazon.com. Motley Fool newsletter services have recommended writing covered calls on Starbucks. The Motley Fool has a disclosure policy.
 We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. Try any of our Foolish newsletter services free for 30 days.


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  • Report this Comment On August 03, 2012, at 12:16 AM, wjcoffman wrote:

    In my quest to be the first one to comment on this article, as encouraged by the message in BOLD above this box, I hereby submit:

    What folks do with their money is absolutely their decision. No question.

    I think that $2,500,000 would go a long way towards allevaiting the pain and suffering of those dealing with, and preventing future incidents of: AIDS, cancer, hunger, poverty . . .

  • Report this Comment On August 04, 2012, at 8:47 PM, rvrstyx wrote:

    When a self-made man or any other investor for

    that matter, puts up his/her business or livlihood for what he or she believes, it's called the courage of one's convictions and to be admired. As far as the viewpoints expressed, there is no consensus at all and may never be. This is the social part of it.

    There is, however, a great deal of new evidence that backs the notion that some decisions are not of our own choosing, but are a matter of individual DNA. Who would choose otherwise rather than be the object of a scornful and discriminatory society? We as a people have shown our willingness to accept minorities (as if it's anyones ultimate choice to accept another human as worthy or not!)we once revilved for no other reason than skin color. Some just agree it is stupid and meaningless and unworthy of further discussion and lets get on with it.

    This is what our great country is all about and what we as a people should stop and celebrate . Of course there are exceptions. Exceptions we employ to diplomacy when we blunder and get into a war and beat ourselves to death over it. Even then, there are some who are bound by ancient tradition or religious law that precludes settling anything between East and West. Ever optimistic, we believe mostly, that we can solve our differences through peaceful ,rather than destructive means, it is a good thing.

    Although a member of Motley fool since 2007, my participation, due to an unfortunate accident at a hospital while recovering from knee surgery, has had a major limiting impact on my capacity to contribute meaningfully after. The VA Hospital saved my life and I hold these dedicated professionals without fault. I seek nothing in the way of restitution and for those who have suggested it, I would sleep better giving thanks to my Higher Power and to the real heros who fought and spilled their blood for us all. They were up against an enemy who put their own children into battle. They blew themselves up for fanatic leaders who have vowed to kill all Western people, using any and all weapons. They won't negotiate. But we have convinced ourselves to try because the alternatives are unthinkably insane, too horrible to entertain.

    The writer doesn't recall hearing from our troops any whining about the unfairness of income taxes or the absense of the well- -to- -do in the ranks after we ordered America's brave young men into the line of fire.

    Without any solicitation on their part, I wish to thank Motley Fool for allowing me to continue and use their excellent free services during this difficult period for myself and my family. Unlike so many other media services, Motley Fool, has from the beginning ,allowed for the free exchange of ideas. For many organizations information no longer flows freely, instead a compilation of problems--oops--"issues" is presented and whether appropriate or not, "you puts yer X and takes yer cherce," to paraphrase one colorful character in literature who nailed it. Or, perhaps more to the point, "dont call us we'll call you....

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