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When Should Companies Take A Stand On Social Issues?

Published April 10, 2016 at 5:11 PM EDT

MICHEL MARTIN, HOST:

Mississippi isn't the only state where critics hope to use the threat of boycotts to oppose new laws they see as discriminatory toward LGBT people. North Carolina also passed a law recently barring cities from enacting laws banning discrimination based on sexual orientation and requiring people in public buildings and public schools to use the bathroom corresponding to their gender at birth. In response, PayPal canceled a planned $3.6 million expansion in North Carolina, which PayPal CEO Dan Schulman said was meant as a clear and unambiguous response to the law. And that got us thinking about how executives go about making decisions in response to social issues. So we called Bill Oesterle. He's the co-founder of Angie's List, a subscription-based online review company. Last year, when he was still serving as CEO of the company, he announced plans to stop a planned expansion of company headquarters in Indianapolis to protest Indiana's religious liberties law that's similar to the one we just heard about in Mississippi. And I asked Bill Oesterle what made him decide to take that stand in Indiana.

BILL OESTERLE: In our case, it was a little bit different in that we were headquartered here already in Indianapolis. And the largest challenge that we had over the 20 years that I ran the company was to recruit and retain the very best talent that we possibly could. At a specific case, my chief financial officer that I had recruited from Chicago - a world-class executive - I recruited him and his partner. Within months, this bill came up, so it was a direct impact to the company on the talent that we were trying to bring in. And that also is critically important to the entire state of Indiana.

MARTIN: For those who don't know your background, I do want to mention that you are a longtime politically active Republican. You're very close to former governor of Indiana Mitch Daniels. This is not a position that people generally associate with active Republicans - of using, you know, economic boycott as a tool of getting attention. They generally associate that tool with people who don't have a lot of economic power, frankly. And I just wonder how you respond to those who say that they consider it - in fact, I think the phrase was used - economic terrorism.

OESTERLE: I wouldn't call what we were doing a boycott. We were going to engage in a partnership with the state. They were going to provide us some funding and tax breaks for us to build what would have been a $50 million headquarters in a bad neighborhood. In exchange for that, we were going to have to agree to hiring targets. And for us, it was a simple, straightforward argument. We're going to be responsible for hiring that many people, we can't do it if the state is going to make it hard for us. I am a Republican, and I think businesses in Indiana are typically Republican supporters. And I think that made a meaningful difference. We were willing to stand up and highlight the division in the Republican Party.

MARTIN: So after the stance that your business took, Indiana did quickly pass a - kind of a clarification to say that the religious freedom law could not be used as a defense against discrimination. Did that get the job done in your view?

OESTERLE: As a company, we took the position that it was not sufficient. We were pushing for a full repeal of the law or for passage of complete non-discrimination protection in our civil rights code. That didn't happen. However, many of the cities around Indianapolis have passed local ordinances protecting LGBT people. That law would have overridden those. That was fixed.

MARTIN: So do you feel you did the right thing?

OESTERLE: Yes, there's no question. I would do it again. We were the first ones. You know, Mississippi and North Carolina and Georgia, they don't get this excuse. Indiana was the first state to get one of these kind of disguised Religious Freedom Restoration Act bills. And so we didn't understand it that well. In hindsight, we would have paid closer attention and gotten on it earlier so we didn't end up on a national stage.

MARTIN: That was Bill Oesterle, former CEO and co-founder of the subscription-based online review company Angie's List. Transcript provided by NPR, Copyright NPR.