What Georgia can learn from North Carolina about corporate backlash

What Georgia can learn from North Carolina about corporate backlash

Illustration: Brendan Lynch/Axios

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We last updated this story at 3:10pm on Friday to include the MLB news.

Corporate leaders around the country are speaking out against Georgia’s new voting law, which many say will disproportionately impact Black voters. Two states away, North Carolina sees shades of 2016.

Why it matters: The corporate rebuke of North Carolina’s House Bill 2, or the “bathroom bill,” went far beyond strongly worded letters from CEOs. The state lost nearly $3.8 billion in business, according to an AP analysis. Big events and conventions canceled, big concerts canceled, and some companies pulled out of major job expansions here.

  • Ultimately, the corporate backlash caused state legislators to repeal HB2.

Now, companies that do business in Georgia want to force the same legislative backpedaling. The longer the backlash lasts, the longer it will weigh on Georgia’s economy, if North Carolina is any indication.

  • “Republican legislators in Georgia need to be cognizant that this is probably going to be a longer term issue than they think. North Carolina is a perfect case study,” Michael Bitzer, a political scientist at Catawba College, tells me.

What’s happening: In the days since Georgia Governor Brian Kemp signed a sweeping GOP-sponsored overhaul of the state’s election law, activists, business leaders and consumers have called on boycotts of Georgia corporations until they take a stand against the measure, known as S.B. 202.

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On Friday, the MLB announced it is moving its All-Star Game out of Atlanta because of S.B. 202, ESPN reported. The league “fundamentally supports voting rights for all Americans and opposes restrictions to the ballot box,” commissioner Rob Manfred said in a statement.

Earlier this week, Georgia-based corporations started chiming in.

  • Delta: In a memo to staffers Wednesday, CEO Ed Bastian called S.B. 202 “unacceptable” because it includes provisions “that would make it harder for many underrepresented voters, particularly Black voters, to exercise their constitutional right to elect their representatives.”
  • Coca-Cola: In an interview with CNBC, CEO James Quincey said the measure “needs to be remedied.” “We have spent many decades promoting within Georgia a better society and a better environment for business.”

Even companies that aren’t based in Georgia are coming out against the measure. Among them: Apple, Microsoft, Bank of America, American Express and Citigroup. And as North Carolina knows well, those statements don’t measure the feelings of the companies that were considering doing business there, but now might not be.

  • “If you don’t have a firm hold in the state, (SB 202) may give you pause to reconsider,” Bitzer said.

President Biden called SB 202 “Jim Crow on steroids” during an interview with ESPN this week. He said he strongly supports moving the MLB All-Star Game out of Atlanta because of the bill.

Zoom out: Georgia is the first battleground state to impose new voter restrictions since the 2020 election. Nationwide, Republican lawmakers have proposed hundreds of laws to restrict voting access in dozens of states, including Texas and Florida.

The relocation of an All-Star Game, coupled with the growing chorus of corporate opposition to the measure, is starting to mirror what happened in North Carolina in 2016.

Flashback: Then-governor Pat McCrory signed HB2 on March 23 that year. The law limited legal protections for LGBTQ+ individuals, and required transgender people to use the bathroom based on the gender on their birth certificate. Corporate outrage to the measure intensified in the weeks and months that followed its signing.

  • PayPal canceled plans a few weeks later for a new 400-job operations center in Charlotte over its opposition to HB2. CoStar Group chose Richmond over Charlotte for a 730-job office because of HB2.
  • Dozens of entertainers canceled North Carolina shows, including Bruce Springsteen, Maroon 5 and Pearl Jam. States like California and New York banned publicly-funded travel to North Carolina because of HB2.

In July, the NBA announced it would no longer host the 2017 All-Star Game in Charlotte. In September, the NCAA removed several championship games from North Carolina, as did the ACC.

  • McCrory lost reelection in fall 2016, in part because of backlash over HB2. Under current Governor Roy Cooper, lawmakers overturned the measure in spring 2017.

Georgia has a governor’s race and a U.S. senate race in 2022, so the outcome of the SB 202 controversy is crucial, says Eric Heberlig, professor of political science at UNC Charlotte. “The stakes are going to be very high,” Heberlig tells me.

My thought bubble: For more than a year, I almost exclusively wrote about the business fallout from HB2 — and that was five years ago. In North Carolina, we spent years paying for the reputational damage that HB2 caused. With a national reckoning with racial injustice still very much underway, the pressure is even greater for corporations to speak out today if laws don’t align with their values.

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