Josh Blackman, a law professor at South Texas School of Law, said Citi’s attorneys may have decided the risk of liability is so low and the cost of travel so insignificant, they’re willing to take that risk. “The bank’s liability is unclear. I’m not certain someone would even have the ability to sue just because Citi paid for an employee’s travel. It’s not clear that would work.”
Match, Uber
Some CEOs have tried to openly navigate the culture wars as they strive to retain talent. Match Group Inc. CEO Shar Dubey, whose Dallas-based company owns some of the biggest dating apps, said last year she was creating a fund to help cover the costs for employees and dependents who need to seek care outside the state. Lyft Inc. and Uber Technologies Inc. pledged to pay legal fees for drivers sued under the Texas law.
Salesforce CEO Marc Benioff said in September the company would offer assistance to employees who wanted to leave Texas in response to the anti-abortion law. On March 12, dozens of companies including Apple Inc., Alphabet Inc.’s Google, Dow Inc. and Johnson & Johnson, took out an ad in the Dallas Morning News urging the state to scrap Abbott’s order on transgender kids.
Investor advocates have been pressuring publicly traded companies to counter the push by Texas and other Republican-led states to enact measures focused on abortion, voting rights and LGBTQ issues. Shelley Alpern, director of shareholder advocacy at Rhia Ventures, a private-equity firm that focuses on reproductive health, said Citi’s move ratchets up the pressure on Texas.
“It’s a real breakthrough moment because there have been a handful of other companies that have announced similar policies but none so far have Citi’s stature,” said Alpern. “So it really helps set a new standard and I’m confident that other companies will follow.”
Women’s rights groups were lukewarm on Citi’s move. “While I think this is wonderful, it’s not enough, they can do so much more,” said Aimee Arrambide, an executive director at abortion care advocacy group Avow.
Businesses continue to come to Texas in droves. In the last year, Tesla Inc. broke ground on a pickup-truck factory in Austin and moved its headquarters to the state capital along with Oracle Corp. Samsung Electronics Co. announced it’s building a $17 billion semiconductor plant outside of Austin.
Goldman plans to build a new office campus in Dallas that may become the bank’s largest presence in the U.S. outside its Manhattan headquarters. Charles Schwab Corp. left San Francisco for the affluent Dallas suburb of Westlake, where Fidelity has a campus. Vanguard plans to open a new office in Plano this May.
Munis, Guns
Citi is working on reviving its underwriting business in the state after a law barred local governments from working with companies that discriminate against firearm entities prompted the firm to suspend its municipal-debt underwriting there for several months. It returned to the market in December.
Keith Wolf, a managing director at recruitment firm Murray Resources in Houston, said Citi could have made a bigger impact if it made a public announcement rather than disclosing the move in a filing. “I imagine it would be a selling point for a group of job seekers.”
Wolf said he hasn’t seen any slowdown in talent moving to Texas.
“These types of issues are very important but it doesn’t mean they will just leave the state because overall its a great place to live,” Wolf said. “While some of these issues are a big concern for people, its not as easy as getting up and leaving.”
-With assistance from Matthew Monks, Laurel Calkins, David Wethe, Gerson Freitas Jr., Michael Smith and Jenny Surane.
This article was provided by Bloomberg News.