Corporate decisions on LGBT friendliness: a multi-level approach

PurposeThis research investigates how and why firms adopt inclusive diversity activities, identifying the mechanisms behind firms involved in lesbian, gay, bisexual and transgender (LGBT)-friendly pursuits. By integrating resource dependence theory, institutional theory and stakeholder theory, the authors argue that a firm's LGBT friendliness is affected by marketing orientation and the external political environment.Design/methodology/approachThis study uses the Corporate Equality Index, as reported by the Human Rights Campaign, of 460 (1,540 firm-year observations) firms in the United States between 2006 and 2019.FindingsThis study finds a significant, positive relationship between a firm's marketing orientation and LGBT-friendly activities. This research also determines that this relationship is weakened by state-level diversity policies and strengthened by country-level political uncertainty.Originality/valueThe study results provide unique theoretical and practical implications for the debate on inclusive corporate policy in similar global markets.