Good morning.
For a few glorious months in my early twenties, I occasionally got to ride on the back of a Harley-Davidson Fat Boy. My roommate Don owned it and would sometimes drive me to a Toronto biker bar to have drinks with his boyfriend, who also owned a Fat Boy. From that limited experience, I presumed Harley embraced diversity.
On Monday, Harley-Davidson posted a statement on X to tell the world that it’s backing away from policies like “supplier diversity spend goals” to “better align” with its customers. “Saddened” by the backlash initiated by activist Robbie Starbuck who has pushed Harley, John Deere, and Tractor Supply to ditch DEI initiatives in recent weeks, it capitulated.
Are brands like Harley really turning their backs on diversity or, as several CEOs have told me, deciding to stop talking about it? Harley distanced itself from DEI on a social media site where it had faced much of the ‘anti-woke’ wrath. On the Harley website, there was language about inclusion but no statement like the one posted on X. A brand beloved by biker gangs and wealthy weekend warriors clearly wants to woo everyone in the face of falling motorcycle sales.
Diversity is good for business. Angry customers are not. Those who dislike companies pushing DEI policies are not all right-wing extremists or racist, any more than those who push companies to take a stance on DEI are all left-wing extremists or doctrinaire. Miscommunication is rife. And Harley’s recent decision to move some of its production to Thailand—in part to skirt retaliatory tariffs because of import restrictions imposed by Biden and Trump—didn’t help it win fans.
The question is how to deal with it. For investors, betting against companies taking action on social issues has proven to be a losing strategy, according to a recent Yale study. As a platform for brand positioning and customer engagement, X is inadequate. Why engage with your most inflammatory critics when you could control the message on your website or with direct communication with core customers?
Consumers want to see themselves in the brands they buy. I drink Bud Light, for example, and I support LGBTQ+ rights. What bothered me about Dylan Mulvaney’s commercial (vs. this one) was the apparent disdain for March Madness during March Madness. For a basketball fan, it’s a bad commercial, regardless of your stance on transgender rights.
Some leaders like TruStage CEO Terrance Williams argue that some issues are too important to sideline or hide in silence. As a $5 billion-a-year insurer distributing products through credit union partners, addressing inequity is core to his company’s business model. “We have to acknowledge bias to ensure that we never repeat it,” he says. “There are real societal impacts, so we have to address it … Some may disagree and I welcome that disagreement. I welcome the dialogue because it means we are talking to each other.”
More news below.
Diane Brady
diane.brady@fortune.com
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TOP NEWS
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AROUND THE WATERCOOLER
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This edition of CEO Daily was curated by Joey Abrams.
