Friends Fiduciary Signs Investor Statement Against North Carolina’s HB 2

October 4, 2016

Friends Fiduciary has joined with other investors totaling $2.1 trillion in assets calling for a full repeal of North Carolina House Bill 2. Some of the other signers include Morgan Stanley Investment Management, John Hancock Investments and the New York State Common Retirement Fund. The bill removed municipal non-discrimination protections for people who are lesbian, gay, bisexual, and transgender, and bans people who are transgender from using bathrooms that correspond with their gender identity. As investors we are concerned that this bill could negatively impact some of the companies in our portfolio.  Friends Fiduciary believes that the bill poses an issue not only for human and social rights but also for long-term economic prospects.

The corporate world continues to move towards greater inclusivity. The bill runs counter to this trend by limiting discrimination protections. There have already been negative impacts on the business and investment climate in North Carolina. The NBA changed plans to host the 2017 All-Star Game in Charlotte, and companies such as PayPal and Deutsche Bank have reversed decisions to expand operations in the state. Investors, including FFC, believe the discriminatory law is bad for business and could pose risks to our companies.  Further, it may limit the pool of talented employees for companies, put federal and private equity funding at risk, and endanger the state’s credit rating; all of these could negatively impact businesses.

Recent research shows that implementation of non-discrimination policies improve not only worker satisfaction and retention but also financial outcomes. Ninety-three percent of Fortune 500 companies have implemented “inclusive non-discrimination policies protecting their employees on the basis of sexual orientation”, and seventy-five percent extend those policies to include gender identity and expression. Ensuring that all people are treated with dignity and respect regardless of their identity is good for society and good for business.

Click here to view the Washington Post’s coverage of it.