‘Shark Tank’ Star: Target’s Collapse Amid ‘Pride’ Controversy Is Wake-Up Call For Corporate America

 “Shark Tank” investor Kevin O’Leary said companies are paying close attention to Target‘s “stunning” market plunge amid a “Pride” collection controversy.

“The future brings a complete change in the thinking of corporate America, particularly S&P 500 public companies,” the chairman of O’Leary Ventures told Fox News host Jesse Watters on Monday.

“How this happened is being scrutinized by lots of other boards right now,” O’Leary said. “And it’s a discussion that’s going on every day with institutional investors.”

In recent weeks, Target lost around $13 billion in market value, a precipitous drop since reporting its earnings last month, leaving its market cap at around $60 billion. Though some analysts say broader economic conditions are at play, the plunge coincides with a wave of backlash and calls for a boycott over Target’s Pride Month collection, which led the Minneapolis-based retailer to pull some of its LGBTQ+ merchandise. JP Morgan even downgraded Target Corp.’s stock, citing “consumer pressures and recent company controversies.”

O’Leary explained how the Target controversy shows companies are faced with the challenge of striking a delicate balance in showing “support of diversity in all the mandates that society is discussing openly” while also protecting the interests of its employees, customers, and shareholders.

“If you start to get too distant or too far away from the primary mandate, the market has proven itself to really, really punish you,” O’Leary said. “And it’s woken up all kinds of boards.”

As was the case with Target and Bud Light, which faced a boycott over its partnership with self-identified transgender social media influencer Dylan Mulvaney, companies are struggling to stay tuned into the mood of their customers, which can turn sour in a matter of hours, O’Leary contended.

“When you can’t control the message anymore through social media, which is clearly obvious, you better figure out what message you’re putting out before it ever gets out there,” O’Leary said.

 

O’Leary pointed to social media in particular as an area of focus, suggesting companies need to add a committee to advise boards on viral trends. He also predicted that diversity officers will remain a fixture.

“I don’t think you’re going to find a lot of people saying, ‘Oh, let’s not have diversity officers.’ I think that boat sailed. But what they do with their budgets now really matter, and the risks they’re putting the company into because of the power of uncontrolled social media is obviously measurable,” O’Leary said. “When you lose $11 billion of market cap, there’re a lot of unhappy cowboys out there. They’re called your investors.”