Businesses Respond to Police Brutality
This week, we talk about how the unrest over the death of George Floyd is prompting businesses to focus on protecting their employees and engaging in conversations on equality and racial justice.
Welcome to our weekly chat about the environmental and social issues that influence the way we work, spend our money and live our lives. We're your hosts, Maitane Sardon and Dieter Holger. Want to get our newsletter every Wednesday? Hit the subscribe button in the upper right corner!
Hi, Maitane. As I’m sure you’ve seen, protests against police brutality have broken out across the United States after George Floyd, a black man, died when a Minneapolis police officer pinned him to the ground with his knee on his neck for nearly nine minutes. The officer has since been arrested. The situation has echoes of the 2014 death of Eric Garner in New York City, who also cried out, “I can’t breathe” after a police officer put him in a chokehold. The protests have been largely peaceful, but looting has taken place. And this is all happening when more Americans are out of work than since the Great Depression.
How is the business world reacting to all this?
Many are speaking out. Citigroup CFO Mark Mason said in a blog post that racial injustice is a systemic problem that needs to be spoken up about and confronted. The CEO of BlackRock, Larry Fink, sent an email to employees encouraging them to talk about racial equality and acknowledging the world’s biggest asset manager “must also consider where racial disparity exists” within the company. Experts say the push for these conversations comes for a variety of reasons, including companies’ desire to attract and retain workers and reach an increasingly diverse customer base.
That’s a good point. Many companies believe that a diverse and inclusive culture lends them a competitive edge. In a WSJ study last year, we saw the companies in the top 20 of the diversity and inclusion ranking had better operating results on average than the lowest-scoring firms, and their shares generally outperformed those of the least-diverse firms.
Some companies are also putting their dollars to work in response to the social justice movement. Verizon Communications chief Hans Vestberg said in a video Monday that the company’s foundation will donate $10 million to racial justice charities. Facebook CEO Mark Zuckerberg wrote in a post Sunday night that the social media company will also give $10 million to groups working on equality and racial justice. Bank of America will donate $1 billion over four years to fight racial and economic inequality. Intel and Cisco Systems have also pledged donations of $1 million and $5 million, respectively.
Have you seen the controversy around how social media companies are managing what people are saying about these protests?
Yes! Hundreds of Facebook employees staged a virtual walkout on Monday to show their frustration with the decision to keep up a post in which President Donald Trump said, “when the looting starts, the shooting starts” and called demonstrators “thugs.” Employees say the post violates company rules about inciting violence. In an employee meeting, Zuckerberg said he doesn’t believe social media companies should regulate political speech even though he found the post offensive. On the other hand, Twitter prevented users from viewing the same Trump tweet without reading a warning that the post glorified violence.
Many restaurants and stores were starting to reopen when these protests broke out. How are they dealing with the situation, Maitane?
A number of stores were damaged during the protests last weekend, including Burger King, Popeye Louisiana Kitchen, Target and Apple stores. Some decided to close early to protect customers and workers. Others, like Macy’s, postponed their post-pandemic reopening in response. “We can replace our windows and handbags, but we cannot bring back George Floyd, Ahmaud Arbery, Breonna Taylor, Eric Garner, Trayvon Martin, Emmett Till, and too many others,” Tapestry CEO Jide Zeitlin wrote in a letter to staff, naming slain African-Americans who have become icons to the civil rights and Black Lives Matter movements.
Have these protests had any kind of impact on the stock market, Dieter?
Over the past few days, stock markets continued to rally as some of the unrest appeared to be settling down and investors focused on the outlook for the economy to pick up as coronavirus infections fall and optimism grows about new government spending intended to help shore up the recovery.
What am I looking at? The chart above shows the performance over the last month of three key market benchmarks--the tech-heavy NASDAQ Composite Index, the Dow Jones Industrial Average and the S&P 500--that contain hundreds of stocks. These serve as bellwethers for investor sentiment.
Any other news you’re keeping your eye on, Maitane?
Well, the European Union last week proposed a €750 billion ($836.7 billion) recovery plan and €1.1 trillion budget for 2021–27 to lift the region from the coronavirus economic slump. As part of the proposal, billions would be spent on renewable energy, clean transport, hydrogen power and energy-efficient building renovations, including a quarter of the budget. If approved, it will mean that the EU is putting the fight against climate change and its 2050 carbon-neutral goal at the heart of its recovery plan to drive business growth. It remains to be seen whether stimulus packages from individual countries will have a green element.
Definitely something to watch. Now let’s open it up to our readers: Do you think businesses have responded appropriately to the death of George Floyd and what would you like to see them do?
Share your thoughts below or catch us on Twitter. Your words could appear in our next edition! Have a great weekend and remember to wash your hands. 👋
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Elevate the Conversation is produced by the editorial teams of The Wall Street Journal and Dow Jones Newswires. Here's a little bit more about us, along with our contact information. We'd love to hear from you.
Dieter Holger, Reporter: I have a knack for uncovering values-based investing trends and I’m obsessed with spreadsheets and charts. I really enjoy ‘80s music, skateboarding and yoga (but I’m bad at both). dieter.holger@wsj.com @dieterholger
Maitane Sardon, Reporter: I have a passion for amplifying the voices of those at the center of stories. I love running on Barcelona’s beaches and binging on chocolate ice-cream to compensate (it’s all about balance). maitane.sardon@wsj.com @sardomaitane
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Like dumping small buckets of water on to a fire in hopes that it goes out, simply donating to charitable organizations isn't enough for large institutions and corporations to eradicate racial injustice. It's a good step in the right direction and it encourages others to step up, but this systemic issue validates an inherent problem that charities and politics can't fully resolve. Public and private companies need to be held accountable within their own respects if they want to see progression on these issues. I think they should deploy more capital towards diversity initiatives from within and fund seminar trainings, support groups, and other educational opportunities for employees. Creating a safe haven for employees of all races to stir organic dialogue is imperative to raise awareness and bring perspective on the issues we might not fully understand.