In a shareholder meeting yesterday, Target executives addressed growing concerns over political actions of the company as well as performance. Shareholders were upset over the $150,000 donation to Minnesota Forward, which is a political group that backed Tom Emmer as a gubernatorial candidate in Minnesota in 2010. Emmer is an opponent of same-sex marriage and the relationship between Target and the candidate sparked a flurry of protests at the time including a flashmob inside one Target store. The singing group even referenced the controversial Supreme Court Ruling in Citizens United v. FEC.
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The donation also caused the Pop Star Lady Gaga to end her relationship with Target and urged them to donate to pro-gay rights charities.
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Chairman, President and CEO Gregg Steinhafel said in the shareholder meeting that Target “learned a lot last year” and that they “welcome everybody”. Target Corp. has changed their policy and process on political donations, but some argue that the process has not helped the situation but rather made it less transparent.
Target has been trading at 52 week lows, but the causes are up for debate. The executives of Target point towards their inability to convince consumers to spend on items other than food and other staples. Steinhafel said that shoppers are “still very thoughtful about spending” during these difficult economic times. Although Steinhafel stated in the shareholders meeting that Target is going to remain “neutral” on gay rights as well as “other social issues that have polarizing points of view”, the damage has been done and might continue. The best way to avoid a controversy like this is, as Mike Dean executive director of Common Cause in Minneapolis stated in a newspaper article, to “refrain from political spending”. Citizens United opened the door for unlimited amounts of campaign spending by corporations which can be detrimental to a democratic system. Perhaps the best defense at this point is to boycott those businesses that participate in the process.
