There was a time when business stuck to business. That is, they focused on the needs of their customers and would never dare tackle a controversial topic for fear that they would alienate large portions of their paying customers. What management thought about politics was irrelevant to the mission of delivering great investment returns to those who had invested their hard-earned retirement funds into the company’s stock.
If a CEO did shoot his mouth off, he either quickly made a retraction, an apology, or he’d be looking for work. The board of directors, in the interest of shareholders, would insist.
Employees, both left and right, used to be able to work together too. Why? Because they focused on customers’ needs, not politics. The world of business sheltered you from the culture wars and held communities together.
But alas, those times are gone. Last week the Supreme Court overturned Roe vs Wade, the 1973 Supreme Court decision that claimed there was a constitutional right to abortion. Abortion will now be legislated by the states.
You’d think that that kind of issue would be avoided by the sellers of sporting goods, banking services, payment processors, and FAMILY entertainment. After all, great numbers of Americans are opposed to each other on that issue. You certainly wouldn’t want to run off ANY of your customers, would you? Not even one. Just to signal to your friends that you were supporting such a terribly divisive issue.
Well, Dicks Sporting Goods, Bank of America, Paypal, and Disney did just that. They all immediately announced that they would be paying for their employees to travel to other states to kill their babies. Huh? Why in the world would they get involved in this issue when half of their customers are thrilled about the end of Roe? Some of their employees and owners are too
Our best guess is that, first of all, it’s in their best interest financially to keep their female workers childless and slavishly devoted to their jobs, rather than their growing families. Maternity leave is expensive.
Second of all, big businesses are highly regulated and controlled by the government, and the government clearly wants an on-demand abortion. We won’t go into what that is here. So they are obeying their masters.
What we’d like to know as investors is, “How do we get the companies we own to stop playing politics and fighting the culture war?” and “How do we get businesses to focus on maximizing investor return?” The answer is to insist that, both as shareholders and as investors in managed funds such as mutual funds and ETFs, companies cease and desist in political action.
This may sound hypocritical coming from a company, Constitution Wealth, which is decidedly political in our investment approach. But we are left with no choice. The left is so active in influencing corporate behavior, we simply must push back. Maybe things will go back to the “old normal” again, but I doubt it.
It is an abrogation of their fiduciary duty to maximize shareholder return as well as being downright destabilizing for the country. Heck, we can’t even get behind our favorite brands anymore.
Remember when everybody liked Disney? Let’s get back there.
