Corporate America Surrenders to Russia's Anti-Gay Legislation

Years of Gaywashing Revealed; Pursuing Marketing Advantages, Not Moral Principles

Russia's harsh, antediluvian, anti-gay legislation -- which the Washington Post reports "has made gay athletes and spectators fearful of discrimination, and even arrest, at the Olympics" -- hasn't provoked a whisper of outrage among American corporations. And that even includes those who have taken aggressive -- and in retrospect -- expedient steps to identify themselves as "progressive" on LGBT issues. Now, their authenticity is called into question.

Many people were surprised when companies like Starbucks and Goldman Sachs vocally declared their support for gay marriage. They shouldn't have been. It was an exquisitely calculated marketing strategy sanctimoniously wardrobed as principled behavior. For Lloyd Blankfein to speak out for same-sex marriage was poll-driven. More than half of all Americans are for it, and among his urban, educated, diverse employees -- and potential recruits -- the number is way higher.

If a core belief in doing the right thing was what motivated Blankfein and others, why aren't they using the Olympics to put their considerate corporate muscle where their opportunistic mouths are? Seems like they only care when there are no real consequences; speaking for marriage equality was part of Goldman's reputational repair plan. They're anything if not smart, and they recognize that the media most hostile to them are also the most supportive of LGBT issues.

There's absolutely no downside. Will any potential clients actually flee the firm for its position? Doubtful. If Goldman didn't lose any business based on their participation in the meltdown -- which resulted in a $550 million deal with the SEC to settle charges of securities fraud -- it's unlikely their gay marriage stand will damage their economics.

On the other hand, standing up to Russia would have economic implications. Goldman generates real revenue there, and is borscht bedfellows with the power elite; in February of this year, Bloomberg reported that "Russia Hires Goldman as Corporate Broker to Boost Image." The story describes a three-year deal with the Economic Ministry that has Goldman "setting up meetings with investors," and as an example of their intimacy with Moscow, Blankfein is a "member of Prime Minister Dmitry Medvedev's advisory committee for turning Moscow into a financial center."

Goldman's silence is equaled by that of Starbucks; their protest over Russia's legislation couldn't be heard over a the sound of a latte being steamed, even though Howard Schultz famously excoriated a shareholder at the company's annual meeting when the interlocutor whinged about the company's support of gay marriage. "You can sell your shares in Starbucks and buy shares in another company." Shultz proclaimed, to great applause in the room.

But Schultz's determination to do what's right stops abruptly at the border.
Starbucks not only has 60 stores in Russia, but is actually opening one in Sochi, seat of the winter Olympics. The PR spiel announcing this deal sounds like a company driven solely by economics, with no moral or ethical commitment whatsoever.

"'The southern regions of Russia are developing dynamically, showing a high level of demand for quality coffee," says Mojtaba Akbari, general director of Starbucks' Russian management company, Kofe Sirena."

Corporate hypocrisy is nothing new, but what is new here is that a company's position on gay rights, of all things, has become the source of illuminating a pernicious ethical compartmentalization. America has evolved its position on gay rights -- and gay marriage -- so that companies like Goldman Sachs and Starbucks can benefit from what is essentially faux courage. But when real courage is required, they fall silent.

The same, of course, holds true for all the sponsors of the Olympics. Major corporations like McDonald's, General Electric, Visa and Coca-Cola, all of whom pride themselves on embracing diversity, are either mum or defensive on the subject. Coca-Cola has defended its sponsorship based on the argument that the games are a vehicle for spreading the Olympic core values of "excellence, friendship and respect."

That's absurd and Coca-Cola knows it. The Olympic Charter states the "Olympism seeks to create a way of life based in... the educational value of good example and respect for universal fundamental ethical principles."

If the Olympic values are to mean anything in the future, then both the IOC and participating sponsors cannot pretend that what's happening in the host country doesn't matter. In fact, both the IOC and sponsors have a responsibility to address the areas -- sensitive though they may be -- where the host country fails to live up to the Charter. Is "a way of life" simply meaningless drivel and dribbling? Didn't we learn that lesson in 1936?

I don't believe this double standard will be able to continue. You can't use your support of gay rights as a handy marketing strategy and discard it when it becomes economically or politically inconvenient. My friend Dov Seidman, author of "HOW: Why How We Do Anything Means Everything" speaks often about the fact that we are now in an "Era of Behavior," driven by the forces of transparency and interconnectedness. In this world, your values must be consistent; indeed, they mean the most when they are the most difficult to live up to.

Over the last year, we've seen gay marriage employed as a marketing strategy and proxy for hipness like never before. Amazon released a pro-gay marriage Kindle ad; Target promoted a gay marriage wedding registry; and Microsoft ran a commercial that showed two gay women kissing. All those would have been truly amazing events just five years ago, and their clustering this year shows how far America has come.

Meanwhile, Russia has been speeding in the opposite direction. Wikipedia, not known for overstatement, notes that "Public opinion in Russia tends to be among the most hostile toward homosexuality in the world..." and points out "A 2013 survey {which} found that 74% of Russians said homosexuality should not be accepted by society (up from 60% in 2002)."

President Obama did the right thing by sending a delegation of gay women and men to represent the United States in the Olympics. Right, but wimpy. It's far from a bold rejection of Russia's values. In fact, it feels small and a gesture of weakness, an admission that we don't have the ability to influence change, just comment on it. That powerless is what Saturday Night Live effectively ridiculed in its Billie Jean King skit on Weekend Update.

The message to Goldman, Starbucks and all the other pliant participants in the Olympics is simple and clear. HOW matters. Use your power to create change in the world, starting at -- not ending at -- Sochi. You can't be superficially courageous about gay rights in the United States, and cowardly silent about human rights abuses in Russia, if you want your brand to mean anything at all. Taking advantage of gays as reputational inoculation is its own kind of moral offense.