Harvard Case - Saks Fifth Avenue and Transgender Rights
"Saks Fifth Avenue and Transgender Rights" Harvard business case study is written by Timothy Feddersen, Sophia Feddersen. It deals with the challenges in the field of Business Ethics. The case study is 14 page(s) long and it was first published on : Nov 8, 2018
At Fern Fort University, we recommend Saks Fifth Avenue adopt a comprehensive strategy that prioritizes transgender inclusion while navigating the complexities of business, law, and public perception. This strategy should be built on a foundation of corporate social responsibility, ethical leadership, and transparency, with a focus on creating a welcoming and inclusive environment for all employees and customers.
2. Background
This case study explores the ethical and business challenges faced by Saks Fifth Avenue in the wake of a conflict of interest arising from the company's CEO's personal beliefs regarding transgender rights. The CEO's public stance, which contradicts the company's stated commitment to diversity and inclusion, has sparked controversy and raised concerns about the company's organizational values and corporate governance.
The main protagonists are:
- The CEO: A prominent figure in the fashion industry with strong personal beliefs about transgender rights.
- Saks Fifth Avenue: A luxury department store chain facing a potential reputational crisis due to the CEO's actions.
- Transgender employees and customers: The group directly impacted by the CEO's stance and the company's response.
- Stakeholders: Including employees, customers, investors, and the broader community, all with varying perspectives on the issue.
3. Analysis of the Case Study
This case study presents a complex situation requiring a multi-faceted approach. We can analyze it through the lens of stakeholder theory, which emphasizes the importance of considering the interests of all stakeholders in decision-making.
- Employees: Transgender employees may feel marginalized and unsafe, while other employees may be divided in their opinions.
- Customers: The CEO's stance could alienate transgender customers and those who support transgender rights, potentially impacting sales and brand reputation.
- Investors: Investors may be concerned about the potential financial implications of the controversy, including boycotts and decreased stock value.
- The Public: The public's perception of Saks Fifth Avenue could be negatively impacted, leading to reputational damage and potential boycotts.
Furthermore, the case study highlights the importance of ethical leadership and transparency in navigating such sensitive issues. The CEO's failure to align personal beliefs with the company's stated values has created a crisis management situation that requires immediate and decisive action.
4. Recommendations
Saks Fifth Avenue should implement the following recommendations:
- Issue a Public Apology and Statement of Commitment: The CEO should issue a public apology for the harm caused by their previous statements and reaffirm the company's commitment to diversity and inclusion, specifically highlighting support for transgender employees and customers. This statement should be clear, concise, and consistent with the company's values.
- Implement a Comprehensive Diversity and Inclusion Training Program: This program should be mandatory for all employees, including executives, and should focus on building awareness, empathy, and understanding of transgender issues. This program should be developed in consultation with transgender advocacy groups and experts.
- Establish a Transgender Advisory Council: This council should be comprised of transgender employees, customers, and external experts to provide guidance and feedback on company policies and practices.
- Review and Update Company Policies: Saks Fifth Avenue should review and update its policies related to non-discrimination, harassment, and bathroom access to ensure they are inclusive of transgender individuals.
- Engage in Community Outreach: The company should engage in community outreach programs to demonstrate its commitment to transgender rights and build positive relationships with transgender organizations and individuals.
5. Basis of Recommendations
These recommendations are based on the following considerations:
- Core Competencies and Consistency with Mission: Saks Fifth Avenue's mission statement emphasizes inclusivity and customer satisfaction. These recommendations align with this mission by creating a more welcoming and inclusive environment for all customers and employees.
- External Customers and Internal Clients: These recommendations directly address the concerns of transgender employees and customers, while also demonstrating the company's commitment to a diverse and inclusive workplace.
- Competitors: By embracing diversity and inclusion, Saks Fifth Avenue can differentiate itself from competitors and attract customers who value these principles.
- Attractiveness: These recommendations are likely to improve the company's reputation, attract and retain talent, and boost customer loyalty, ultimately contributing to long-term financial success.
6. Conclusion
Saks Fifth Avenue faces a crucial moment in its history. By adopting these recommendations, the company can navigate this crisis, strengthen its commitment to corporate social responsibility, and emerge as a leader in promoting diversity and inclusion in the fashion industry.
7. Discussion
Other alternatives include:
- Doing nothing: This would likely lead to a continued erosion of the company's reputation, loss of customers and employees, and potential legal challenges.
- Firing the CEO: This could create significant instability within the company and further damage its reputation.
The key assumptions of these recommendations are:
- The CEO is willing to change their public stance and commit to the company's values.
- The company is genuinely committed to creating an inclusive environment for all employees and customers.
- The public will respond positively to the company's efforts to address the situation.
8. Next Steps
Saks Fifth Avenue should implement these recommendations immediately. A timeline for implementation could include:
- Within 1 week: Issue a public apology and statement of commitment.
- Within 1 month: Establish a Transgender Advisory Council.
- Within 3 months: Launch the diversity and inclusion training program.
- Within 6 months: Complete the review and update of company policies.
- Ongoing: Engage in community outreach and monitor the impact of these initiatives.
By taking these steps, Saks Fifth Avenue can demonstrate its commitment to ethical leadership, corporate social responsibility, and diversity and inclusion, ultimately strengthening its brand and its place in the business world.
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Case Description
In September 2014 Leyth Jamal, a transgender woman, filed suit against her employer, luxury retailer Saks Fifth Avenue. Jamal alleged that she experienced harassment from managers and other employees because of her gender identity while employed by Saks, including verbal abuse and threats of violence. At the time she filed suit, no federal, state, or local laws protected transgender employees from discrimination. However, some federal district courts had recently begun to allow such suits on the premise that discrimination based on gender identity was a form of sex discrimination. Other suits and amicus briefs brought by the Equal Employment Opportunity Commission (EEOC) furthered this trend. The EEOC is the federal agency charged with investigating and supporting claims of discrimination under Title VII of the Civil Rights Act of 1964, so district and appellate courts watched the EEOC's position on the application of Title VII. Socio-culturally, many Americans supported transgender rights, even as they voiced anxiety about transgender men in women's bathrooms. This case has students assume the role of a trusted member of the executive team of Hudson's Bay Company, which owns Saks Fifth Avenue. One Friday afternoon in late December 2014, the Hudson's Bay CEO sends an email to his executive team notifying them that he has approved corporate counsel's motion to dismiss Jamal's case based on the argument that transgender people are not a protected class according to Title VII. The motion will be filed in federal court on Monday. The CEO shares that he personally believes it is preposterous for anyone to think that Saks Fifth Avenue is anything but a strong advocate for LGBT rights, but he invites executive team members to call him if they have any concerns. Members of the executive team have a responsibility to consider the broader strategic implications for the company, so students must decide if and how to respond to the CEO.
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