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 the bike and would sometimes drive me to a biker bar in Toronto to have drinks with his friend who also owned a Fat Boy. Based on that limited experience, I assumed Harley embraced diversity.
On Monday, Harley-Davidson posted a statement on X telling the world that it was backing away from policies like “supplier diversity spend goals” in order to “better align” with its customers. “Saddened” by the backlash from activist Robbie Starbuck, who has urged Harley, John Deere and Tractor Supply to abandon DEI initiatives in recent weeks, it capitulated.
Is a brand like Harley really turning its back on diversity or, as multiple CEOs told me, is it simply choosing not to talk about it anymore? Harley distanced itself from DEI on a social media site where it has been the target of much of the “anti-woke” anger. The Harley website had language about inclusivity, but no statement like the one on X. A brand beloved by biker gangs and wealthy weekend warriors clearly wants to appeal to everyone in the face of declining motorcycle sales.
Diversity is good for business. Angry customers are not. People who hate companies that push DEI policies aren’t all far-right or racist, any more than people who push companies to take a stand on DEI are all far-left or doctrinaire. Miscommunication is rampant. And Harley’s recent decision to move some of its manufacturing to Thailand, in part to avoid retaliatory tariffs over import restrictions imposed by Biden and Trump, didn’t help the company win fans.
The question is how do we deal with this? According to a recent Yale study, betting against companies that take action on social issues has proven to be a losing strategy for investors. As a platform for brand positioning and customer engagement, X is inadequate. Why bother with your most inflammatory critics when you can control the message on your website or through direct communication with core customers?
Consumers want to see themselves in the brands they buy. For example, I drink Bud Light and I support LGBTQ+ rights. What bothered me about Dylan Mulvaney’s ad (compared to this one) was the apparent disdain for March Madness during March Madness. As a basketball fan, it’s a bad ad, regardless of your stance on transgender rights.
Some leaders, like TruStage CEO Terrance Williams, argue that some issues are too important to ignore or hide in silence. As a $5 billion-a-year insurer that distributes products through credit union partners, addressing inequality is core to his company’s business model. “We have to acknowledge biases to make sure we never repeat them,” he says. “There are real societal consequences, so we have to address them. … Some may disagree, and I welcome that disagreement. I welcome dialogue because it means we’re talking to each other.”
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Diane Brady
diane.brady@fortune.com
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This story originally appeared on Fortune.com
