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Wal-Mart CEO Has a Problem With Gays

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Mike Duke, who has been chief executive of Wal-Mart Stores for just three months, is getting a lot of attention in the blogosphere. It's not the kind of attention a new CEO wants.

"Shameful, bigoted and discriminatory" is the headline over one blog post about Duke.

Why? Because, it turns out, Duke signed a petition last year that put an initiative known as Act 1 on the ballot in his home state of Arkansas. The controversial initiative says that only married couples may become adoptive or foster parents in the state, closing the door for same-sex couples. It passed in November with 57 percent of the vote.

Mr, Duke, what on earth were you thinking?

Needless to say, this is unwelcome news for Wal-Mart, the world's biggest retailer, and it's especially hurtful to the company's gay employees. Wal-Mart has struggled in recent years to figure out how to deal with LGBT (lesbian, gay, bisexual and transgender) issues. It supported an employee group called Wal-Mart Pride, which triggered a backlash, which subsequently caused the company to pull back its support for national gay-rights group. (See my 2007 FORTUNE.com column headlined Wal-Mart shuns gay groups.) More broadly, Wal-Mart has worked hard and for the most part effectively to position itself as a good corporate citizen as it tries to expand from its rural roots into urban, liberal areas. This will be a setback.

News that Duke had signed the petition caught the company flat-footed. When I asked a Wal-Mart spokesman for a comment, I got this response and no more:

I can confirm that Mr. Duke did sign the petition. Also, Wal-Mart did not take a position on the ballot initiative.

I learned from a source inside Wal-Mart that Duke was going to meet with the Wal-Mart Pride group to talk about the issue. (Note to Wal-Mart employees -- feel free to let me know how that meeting went by email at marc.gunther@gmail.com.) A gay employee told me that he hopes that this incident will be a catalyst for positive change.

The story of how Duke's name came to light -- you can see a photocopy of the petition sheet (PDF) here -- is the latest illustration of how digital media is exposing corporate and individual behavior.

Last week, a gay rights group i called KnowThyNeighbor.org posted online the names of the 83,000 Arkansas citizens who signed the petition, in a searchable database. The petitions are public records.

KnowThyNeighbor.org had previously published names of more than 500,000 people who signed anti-gay petitions in Massachusetts and Florida. In a press release about the Arkansas outing (my word), Tom Lang, the group's director, says:

These petition signers need to stand behind their signatures and be responsible for this dehumanizing attack on the gay community. It's disgraceful that they have chosen to exercise their prejudice at the expense of children who are now being denied access to loving adoptive and foster parents.

Lang urges family members, friends, co-workers and customers of those who signed the petition to confront them:

These conversations can be uncomfortable for both parties but they are desperately needed. The more that gays and lesbians talk about the importance of their relationships and their love for their children, the faster stereotypes break down and both sides begin to realize how much they have in common.

Two days later, a reader identified as Concerned Arkansas Citizen posted a comment:

One VERY prominent person in Arkansas that has signed the petition is Michael Duke of Rogers, AR. He is the new CEO of Walmart Stores, Inc. He should explain himself.

By Monday, gay and liberal bloggers like Queerty and Daily Kos were running with the story and gettings lots of comments. Who says bloggers never dig up news?

For what it's worth, Wal-Mart got a 40% rating in 2008 on the Corporate Equality Index published by the Human Rights Campaign, the nation's biggest LGBT advocacy group. Target, a rival, got a 100% rating and Costco got a 93% rating.

Ellen Kahn, Director of the Human Rights Campaign's Family Project, sent me this comment by email:

When Mike Duke voted in favor of ACT 1...he essentially closed the door to a hopeful future for the hundreds of children in Arkansas's foster care system...Duke should think about the real lives of these kids and show some compassion.

Duke's defenders including Jerry Cox, director of the Arkansas Family Council, who called it an invasion of privacy to publicize the names of citizens who are exercising their right to petition the government, according to the Arkansas Times. What's more, he wrote, many voters will sign any petition based upon "one simple principle: that the people, whenever possible, have the right to vote on issues that could directly impact their lives."

I'm not persuaded. Duke chose to sign a petition, which is a public document, so how has his privacy been invaded? What's more, if you believe, as I do, that equality for LGBT people under the law is a civil rights issue, then there's no reason to put it up to a popular vote.

At the very least, Duke's decision to sign the petition reflects poor judgment. As a senior executive of Wal-Mart, he should have known that supporting a controversial measure widely seen as anti-gay could boomerang. (The Arkansas Democrat and Gazette called Act 1 "just another exercise in stirring up bad feelings.") Duke has alienated LGBT customers and their allies, as well many of his own employees.

And if Duke figured that no one would ever know, well, that wasn't very smart either. Several years ago, the writers Don Tapscott and David Ticoll wrote a book about transparency in business aptly called The Naked Corporation. There are few secrets these days in corporate America. CEOs (and future CEOs) need to pay close attention to how they behave -- on and off the job.