Source: iStock

Rollbacks of diversity, equity and inclusion initiatives are at the forefront of of the national imagination since Donald Trump took office, particularly where women, people of color and the LGBTQ community are concerned. Although some firms are sticking to their DEI goals, the number of companies saying they are dumping their diversity programs  — essentially choosing sides in a war against people of color — is increasing, as well.

Some major corporations have made headlines for cutting or altering DEI programs, including Meta, Walmart, Target, McDonald’s, Lowe’s, Toyota, Nissan, Boeing, and most recently, grocery chain Aldi. All have been synonymous with American consumerism for decades and most people have driven, eaten, engaged with, flown, or hammered and screwed one of these brands.

This comes in the shadow of the DEI overhaul in the federal government in which the Trump administration is effectively attempting to erase the concept from the national memory, as Brandon Tensley writes in Capital B.

The term “boycott” began floating around the social media streets in the hours and days since Target announced its DEI rollback. Now, major civil rights activists call for Target to be the object of a massive boycott, according to the Associated Press.

“We thought that they would hold the line. We thought that they would continue to stand for the values that we all hold dear,” activist and attorney Nekima Levy Armstrong told reporters at a news conference, the AP said. “But instead they acted cowardly, and they made the decision to bow down to the Trump administration.”

Boycotting Can Work, But It Takes Standing on Business

Leslie Taylor-Grover makes the point in PushBlack that such actions are an affront to Blackness because they attack the overall well-being of Black people

A call for Black Americans — just 13% of the US population — and allies to stay away from stores like Target that notch more than $100 billion in annual sales may not bring those stores to their knees, but could still do some damage.

In 2022, rapper Kanye West drew anger for making antisemitic comments. After Jewish activists, social media influencers and even some celebrities drew the line, Adidas took a step back from its collaboration with him, ultimately losing $1.3 billion.

The most significant boycott by Black Americans was the famed Montgomery Bus Boycott of 1955-56. The Rev. Dr. Martin Luther King Jr. led the nonviolent strike against the public transportation system in Montgomery, Ala., after Rosa Parks was arrested upon refusing to leave her seat at a white man’s demand.

However, the planning for that particular action was detailed and took the buy-in of 40,000 people. In the end, it was effective. A federal court ruled that segregation on Montgomery’s buses was a violation of the 14th Amendment. Although the city appealed all the way to the Supreme Court, justices upheld the lower court’s ruling in December 1956.

The Montgomery Bus Boycott was the result of detailed strategic planning, use of an existing social network and grassroots support. But that boycott was intended to change a law, not hit a company’s pocketbook. Still, just as supporters did things like participate in carpools to support the effort, there are also places  to find alternatives to goods people buy in Target.  Ultimately, a boycott against a company like Target needs to have an impact in order to be worth the effort, but it need not be fiscal.

“Boycotts may not need to affect sales at all in order to be effective,” wrote Brayden King of Northwestern University’s Kellogg School of Management in a study published by the college. “Rather, boycotters’ influence stems from their ability to make negative claims about the corporation that generate negative public perceptions of the corporation.”

Is Shareholder Activism an Option? Yes, But…

There are multiple examples of shareholder activism, sometimes to get a company to respond to shareholder demand, sometimes for ethical reasons. By definition, this is a type of activism in which shareholders use their equity stakes to put pressure on a company’s management or board. But its use to speak truth to power dates back as far as 1947, when activists James Peck and Bayard Rustin, then organizers with Fellowship of Reconciliation and the Congress of Racial Equality, organized a series of interracial demonstrations called the Journey of Reconciliation.

The bus travels focused on ending segregation in transportation. But what ensued was violence, domestic terrorism, and even jail for Rustin. But in 1948, the two took their case to the board of Greyhound Bus Lines, insisting at a shareholders meeting, of which Peck was a member, that they could create awareness of Greyhound’s violation of anti-segregation rules. In 1951, Peck wound up in court against Greyhound saying it was going against its shareholder proposal rule.

The next year, Greyhound amended that rule so that activist proposals could not be used for racial or social justice causes. The rule stood with the Securities and Exchange Commission until 1976.

In the case of Target, it is unclear what shareholder activism might look like long term. But it would take individuals or groups buying shares of stock, which would give them the right to vote, show up at shareholders meetings and participate in other activities. For those who are willing to be patient enough to see an impact – an effort that could wind up in the courts as Peck’s did – it still might be worth it.

Vaneesha Dutra, Associate Professor of Finance at Howard University’s School of Business said shareholder activism can make a real difference in lieu of boycotting , but in the right frame.

“Many are unaware that shareholders have a right to vote on company leadership via their proxy votes. This is a valuable characteristic of stock ownership.  Owners also speak with the purchase and sale of their shares,” Dutra explained to URL Media. 

“Collectively, if a people make consumption and investment decisions based on the products and services that support and honor their identity and community, they speak volumes to the market and corporate leadership,” she said.

READ MORE