Adoption of LGBT-Inclusive Policies: Social Construction, Coercion, or Competition?

Abstract

Abstract Companies evaluate LGBT policy adoption in an environment with competing and often contradictory societal institutions and ethical frames. This makes the adoption process more difficult to understand when compared to new practice diffusion in less contested settings, providing an opportunity to examine diffusion in an uncertain and varying institutional environment. Herein, we develop a policy adoption model that examines both competing and reinforcing forces. Utilizing a longitudinal dataset of LGBT policy adoption by 283 firms across 1980 firm-years between 2002 and 2014 as measured by the Human Rights Campaign (HRC), we find that firms respond to coercive, social constructivist, and competitive forces for and against LGBT-inclusive work policy adoption. We find that coercive forces exercised by shareholder resolutions and competitive forces driven by industry-level policy adoption lead to firm-level policy adoption. However, other forces, such as state-level anti-marriage equality constitutional amendments, are associated with LGBT-exclusive policies. We also disaggregate the overall HRC policy data into equal employment opportunity (EEO) policy, benefits, and inclusion dimensions and find similarities and differences among our hypothesized relationships.