Jan. 15 (Bloomberg) -- Indiana’s debate about same-sex marriage was once all about morals. Now it’s about business.
Two local chambers of commerce and employers led by Cummins Inc., the world’s largest maker of big diesel engines, and Eli Lilly & Co., the biggest U.S. maker of insulin products, gave $100,000 each to a campaign against putting a constitutional amendment prohibiting gay unions on the November ballot. Their message: A ban would tell talented workers to stay out of Indiana.
“If we have a climate in our state that makes people feel unwelcome in any way, we think that’s bad for Cummins, and we think that’s bad for business,” Marya Rose, chief administrative officer, said in an interview at the company’s Indianapolis offices.
Debate on the matter this week in Indiana’s legislature comes a decade after 11 states approved constitutional bans on gay marriage. Now, businesses and executives are taking more active roles in undoing them. Nike Inc. and its executives put up $280,000 in Oregon to repeal that state’s measure in November. General Mills Inc. opposed a ban in Minnesota in 2012.
The involvement of business in the heartland Hoosier state could persuade companies to get involved elsewhere, said E. Joshua Rosenkranz, a lawyer for Orrick, Herrington & Sutcliffe in New York who represented 100 companies in a U.S. Supreme Court brief opposing a California ban last year. They included Apple Inc., General Electric Co. and Google Inc.
“The business community increasingly sees marriage equality as a business imperative,” Rosenkranz said in an e-mail. “The more companies who step forward, the more willing other companies are to join in the fight.”
Seventeen states and the District of Columbia have legalized gay marriage, including Illinois, Minnesota and Hawaii, whose legislators voted last year. New Mexico, the only state without a law allowing or prohibiting it, was barred by its highest court Dec. 19 from denying anyone marriage.
Claims that bans hurt business are “totally ridiculous” and made by “cultural elites,” said Brian Brown, president of the National Organization for Marriage. The Washington-based group describes itself as “a nonprofit organization with a mission to protect marriage and the faith communities that sustain it.”
“Eli Lilly and Cummins are betraying their own business principles,” Brown said in a telephone interview from Philadelphia. He argued that more than half of their customers “support marriage as between a man and a woman.”
In Indiana, where Republicans control both legislative chambers, lawmakers held a first committee hearing Jan. 13 without voting on putting the amendment on the ballot. It would recognize only marriages “between one man and one woman” and also reject “a legal status identical or substantially similar to that of marriage for unmarried individuals,” which opponents said could affect domestic-partner benefits from some companies and cities.
Executives for Cummins, which has 46,000 employees in more than 60 countries and its headquarters in Columbus, and Indianapolis-based Eli Lilly, with about 38,000 workers worldwide, joined a coalition called Freedom Indiana to block the amendment. They said they need to recruit engineers, scientists and other “knowledge” workers, and that the amendment would impede them -- especially when employees can work in states where they can marry.
Rose told of an engineer whom Cummins spent two years training -- only to have him leave because his partner in California wouldn’t move to Indiana.
Besides Cummins and Lilly, 29 companies, universities and other organizations oppose the amendment. A bipartisan group of mayors, including Republican Greg Ballard of Indianapolis, are opposed, according to Freedom Indiana.
Indiana’s unemployment rate was 7.3 percent in November, compared with 7.0 in the U.S. Its economic health ranks 17th from the second quarter of 2012 through the same period last year, according to the Bloomberg Economic Evaluation of States.
A negative and expensive ballot fight would distract from education and more critical needs, said Robert Smith, senior director of corporate responsibility at Lilly.
“This will feel like the definition of a self-inflicted wound,” Smith said in an interview at the company’s headquarters. “It was important for us to lead. If we didn’t do it, who would?”
Businesses generally avoid divisive issues for fear of a backlash from employees, shareholders and customers. The fast-food chain Chick-fil-A Inc. faced calls for boycotts from supporters of gay marriage in 2012 when its chief executive said his company endorsed the “biblical definition of the family unit.”
“The businessman’s perspective is that social issues are not something they want to be involved with,” said Doug Whitley, president and chief executive of the Illinois Chamber of Commerce. Whitley said the chamber did not lobby on the gay-marriage bill in Illinois that was given final approval by lawmakers Nov. 5 and will take effect in June.
Even so, Whitley said there has been a “generational change in attitude” toward same-sex marriage, and as older Americans leave the workforce, states need to be mindful of younger workers who will replace them.
Not all Indiana companies are taking a position. While chambers in Indianapolis and Fort Wayne, the state’s two largest cities, oppose it, the statewide body that includes firms in rural areas said it couldn’t reach consensus.
An October poll by WISH-TV and Ball State University showed that while 58 percent of Indiana residents opposed the amendment, 48 percent supported legalizing gay marriage, compared with 46 percent who opposed it. The response varied by age, with almost three-fourths of those under 24 favoring same-sex marriage and only about a quarter of those 65 and older.
Indiana already bans gay marriage. The amendment would prevent a judge from overturning the state law, said Micah Clark, director of the American Family Association of Indiana, which bills itself as “the state’s premier decency organization.”
“The future of marriage doesn’t belong in the hands of Eli Lilly or Cummins,” Clark said. “It doesn’t belong in the hands of the media or Hollywood activists. It belongs in the hands of voters.”
Michael Huber, president and chief executive of the Indianapolis Chamber, said his group wants to highlight the economic impact.
“We hope that it helps to take a lot of the emotion out of the issue and start to get people thinking about it as a practical business issue,” Huber said.
Framing the issue in economic-development terms makes a difference in the debate, said Representative Ed Clere of New Albany. He was the only Republican lawmaker to oppose the resolution when it passed in 2011, and he predicted more would vote against it this year. Indiana requires that the same resolution must be adopted by two separately elected general assemblies to reach the ballot.
While many Republicans fear a primary challenge if they don’t support the measure, the stand by businesses has “given refuge” for some to change their minds, said House Democratic Leader Scott Pelath of Michigan City.
“With traditional Republican supporters saying, ‘Look, this is the wrong thing to do at the wrong time,’ it’s now allowed some Republican politicians to be able to begin to say, ‘Maybe we ought to hold our horses here,’” Pelath said in an interview at the statehouse.
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