Target, Dick's Sporting Goods facing pushback from investors for 'going woke'
How have Target's sales and stock prices been reportedly affected by the backlash against their Pride Month displays and partnerships?
Target's sales and stock prices have reportedly been negatively affected by the backlash against their Pride Month displays and partnerships. The company faced a severe backlash in the spring of 2023, which led to a $12 billion lawsuit against the company and caused Target to be rated "high risk" on 1792 Exchange's Corporate Bias Ratings. The National Center for Public Policy Research (NCPPR) argued that the backlash hurt Target's sales and damaged its stock price significantly. Target's board issued a statement urging shareholders to vote against the NCPPR's proposal, saying they did not believe it was necessary.
What specific proposals are the National Center for Public Policy Research (NCPPR) presenting at the shareholder meetings of Target and Dick's Sporting Goods?
The National Center for Public Policy Research (NCPPR) is presenting two specific proposals at the shareholder meetings of Target and Dick's Sporting Goods1.
At Target, the proposal is asking the company to provide a report on its partnerships and other support for "divisive social and political organizations and causes." This is in response to the company's Pride Month displays which sparked backlash last year.
At Dick's Sporting Goods, the proposal is asking shareholders to consider a bylaw amendment waiving the business judgment rule. The NCPPR argues that this would bring greater board accountability for corporate acts taken to advance the political or ideological views of management. This is in response to the company's decision to prioritize political views over financial implications in the past, specifically regarding gun violence.
How has the broader trend of "anti-woke" shareholder activism affected other companies and their corporate governance strategies?
The broader trend of "anti-woke" shareholder activism has been on the rise against corporate boards in recent years, targeting companies with policies or stances that activist investors deem too progressive or politically correct. This has led to increased scrutiny of corporate governance strategies and has pushed some companies to reevaluate their approach to social and political issues.
Several major companies, including Target, Dick's Sporting Goods, Kohl's, and Disney, have faced pressure from anti-woke activist investors to change their policies or disclose more information about their partnerships with organizations promoting social and political causes. For example, Target faced backlash over its Pride Month displays in 2023, while Dick's Sporting Goods was criticized for its stance on gun restrictions.
While none of the proposals brought by anti-woke activist investors have passed so far, their increasing presence in shareholder meetings has raised awareness of the potential financial risks associated with companies taking controversial positions on social and political issues. This has led some companies to reconsider their approach to corporate social responsibility and focus more on shareholder value.
In response to the growing trend of anti-woke shareholder activism, some companies have adopted a more conservative approach to social and political issues, while others have doubled down on their commitment to diversity, equity, and inclusion (DEI) initiatives. For example, Disney successfully defended itself against an anti-woke, anti-DEI attack by activist investor Nelson Peltz, arguing that its pro-DEI shareholder activism would deliver greater economic value to all stakeholders2.
Overall, the trend of anti-woke shareholder activism has had a mixed impact on corporate governance strategies, with some companies reevaluating their approach to social and political issues and others remaining committed to their DEI initiatives.