According to investor Kevin O'Leary, corporate boards are examining how Target got involved in a social scandal that caused a significant loss in market value. The boards are responsible to their shareholders and closely scrutinize Target's actions.
Target's market value has decreased by $13 billion to $60.24 billion due to the controversy surrounding its Pride merchandise. O'Leary, the head of O'Leary Ventures, predicts that corporate America will need to make significant changes in how they address issues like the ones that caused Target's significant loss, according to Fox News.
The speaker explained that while companies want to publicly support the idea of diversity, investors, and retirees who own stocks are worried that companies may be straying from their primary goal, prioritizing their customers, employees, and shareholders.
Target has faced controversy due to its swimwear designed for the transgender community, which has caused outrage across the country.
Additionally, it has been revealed that the company's nonprofit foundation, led by senior corporate officials, funded an organization seeking to give up US territory, including Mount Rushmore, because it represented White supremacy and sought to decrease the military's power due to worries about violence.
O'Leary suggests that the speed at which news spreads on social media intensified the furor around Target's behavior. He believes that corporate boards need to consider the power of viral word-of-mouth and create a communications/media committee to advise the rest of the board, who may not be familiar with social media.
He also warns that corporate boards need to understand the risks of social media communication. He cites Anheuser-Busch's Bud Light brand being destroyed in 32 hours after partnering with a transgender socialite. Diversity officers will continue to be part of corporate boards, but it's important to consider their actions and power.
He believes that companies need diversity officers but should be cautious about how they spend their budgets and the risks they take due to social media.
He also suggests that Target CEO Brian Cornell was likely unaware of the anti-Mount Rushmore appropriation controversy. Elon Musk predicts potential lawsuits by Target shareholders in response to a stock downgrade report.
Read also : Target Executive's Involvement with Group Pushing Transgender Agenda in Schools Raises Concerns
The Transgender Issue
The controversy surrounding Target's swimwear designed for the transgender community highlights the importance of understanding and addressing diverse customer needs. While some customers have expressed outrage, others have praised Target's inclusivity and commitment to diversity.
However, it is important for corporations to be aware of potential risks associated with social media communication. The speed at which news spreads on these platforms can intensify public opinion and create a backlash against a company or its actions.
Corporate boards should consider creating communications/media committees that are familiar with social media trends and can advise other board members accordingly. This will ensure that decisions take into account potential viral responses from consumers.
While diversity officers play an important role in promoting inclusion within companies, there may be risks associated with certain actions taken by these individuals or teams on behalf of the organization. It is crucial for companies to carefully evaluate budgets allocated towards such initiatives as well as any related social media implications before proceeding.
Effective corporate governance requires careful consideration of all factors involved in decision-making - including feedback from diverse stakeholders inside and outside the company - so businesses can succeed while remaining true to their values over time.
Related article: Target Pulls LGBTQ Products Amid Threats to Employees' Well-Being
