In 2013, Jochen Zeitz and Sir Richard Branson founded a non-profit called The B Team that declared businesses should strive not just to turn a profit but to become a force for social, environmental and economic good.
Today, Zeitz runs Harley-Davidson, and his decade-old commitment did not stop the all-American motorcycle manufacturer from publicly repudiating goals related to diversity, equity and inclusion this week. Harley-Davidson had become the latest company targeted on social media by the politically conservative activist Robby Starbuck, and his latest apparent victory.
Retailer Tractor Supply, tractor maker Deere and Jack Daniel’s whiskey maker Brown-Forman have all reversed diversity commitments of their own in recent months under threat of “anti-woke” boycotts spearheaded by Starbuck.
On Monday, Harley-Davidson posted on X that while it was “saddened” by the online firestorm, the company had in fact ended its DEI function in April. It had also eliminated goals to spend more with diverse suppliers, refocused employee resource groups solely on professional development and begun requiring centralised approval for all corporate sponsorships.
Some supporters of Starbuck’s campaign wanted more. Many of the comments below Harley-Davidson’s statement called for the chief executive’s dismissal.
Zeitz, 61, was born in Mannheim, Germany, to a dentist and a gynaecologist. In 1993, after just three years in Puma’s marketing department, he became chief executive of the sportswear group at the age of 30, the youngest ever chief executive of a German listed company. Pulling Puma back from the brink of bankruptcy, he cut the workforce nearly in half and moved shoe production from Europe to Asia.
He also helped revive the brand by upping its coolness factor, sponsoring African football teams and signing sprinter Usain Bolt. By 2007, when François-Henri Pinault’s PPR, now Kering, bought a majority stake in Puma, the share price had risen 4,000 per cent.
Harley-Davidson, a brand that the Baby-boomer generation associates with the freedom of the open road, thanks to classic movies like 1969’s Easy Rider, sought Zeitz as a turnaround expert to help revive the company’s sagging stock price. Harley-Davidson is attempting to renew its allure among motorcycle enthusiasts. He had joined the manufacturer’s board in 2007 and, in an executive shake-up, became chief executive in May 2020.
That same month a police officer murdered George Floyd, and shortly afterward DEI burst into boardrooms around the world. Wall Street executives such as Larry Fink at BlackRock called out the need to address racial injustice in the US and across the world. Shareholders pressured Amazon and other giant companies to address racial issues.
But the counter attack started in 2021. Vivek Ramaswamy, a former biotech executive and now Donald Trump ally, started decrying “woke capitalism”. By 2023, support for DEI started to wane. DEI leaders at Disney, Netflix and Warner Bros Discovery resigned or were let go, and this year, with the US presidential election looming in November, Republicans have increased their attacks on DEI policies.
Starbuck’s attack on Harley-Davidson comes at a vulnerable time for the company. Its share price is flat since the start of the year, compared to a 9 per cent gain for the broad S&P MidCap index, which includes the motorcycle maker’s stock.
Its share of the heavyweight motorcycle market has fallen, too, from 50 per cent as recently as 2019, to 38 per cent now, according to Morningstar. The research group said in a report this month that the brand’s “intangible advantage has declined”.
Zeitz is a polyglot and “hobby philosopher” who collects contemporary African art, and some of the brand’s loyalists dislike him intensely. Dean Nelson, a motorcycling influencer who goes by the name The Biker Guru, criticised Zeitz’s “extreme pro-European lifestyle”, saying “this man in no way represents we, the Americana motorcycling community”.
In a September 2022 interview with the Financial Times, Zeitz said it was “a cliché” to label Harley-Davidson’s customer base as political conservatives, saying the brand’s fans comprised “a very diverse and inclusive community”.
The Wisconsin-headquartered company had itself embraced “inclusive stakeholder management”, he said, and made changes “to transform how it was run in the past and how it’s run today”.
“We’re doing the right things for the right reasons,” Zeitz said. “We are not doing the sort of ‘tick the box’ kind of ESG approach, which some companies have done. So we’d rather do it and not talk about it.”
“Just take the work environment that we have created,” he added. “It’s a much more inclusive company than it’s ever been, and not inclusive from a ‘woke’ perspective, as people would say, but because we’ve democratised how we operate as a business by hiring the best talent wherever they are. Whether you’re in Boston, New York, or whether you need to pick up your kids from school or not, you have that flexibility . . . We just say, ‘Whatever suits you and your lifestyle. You’re welcome.’”
Prefiguring the shift that Harley-Davidson announced on Monday, its annual report this year said nearly 30 leaders across the company participated in a two-day Courageous Leader DEI Summit. That was 40 fewer participants than it had sent to the same summit a year earlier.
Nelson was claiming victory on Monday.
“They hear the message loud and clear from their customers,” he said. “We now have completely turned around and pressured Harley-Davidson to . . . drop all of their liberal agenda.”
But Starbuck signalled that the pressure on Zeitz is far from over. “The question dealers and riders are asking now is how the board allows him to stay on as CEO after he oversaw the injection of wokeness into the business,” Starbuck said on his Instagram channel. “I think that’s a great question and one that needs to be answered by the board of directors.”
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