Companies Seeing Backlash Over Moving Their HQ Overseas

People get upset when a company seems willing to forget its roots out of mere financial opportunism. CEOs will have to consider the growing possibility of consumer and political backlash in the U.S. in the face of such moves.

But it was less than two years ago when Wasson sought a series of tax breaks from Illinois, notching $46 million in corporate income-tax credits over 10 years in exchange for a pledge to create 500 jobs and invest in upgrading its offices; Illinois also threw in $625,000 in training money and $875,000 in other tax incentives.

“We are proud of our Illinois heritage,” Wasson told The New York Times. “Just as our stores and pharmacies are health and daily-living anchors for the communities we serve, we as a company are now re-committed to serving as an economic anchor for northeastern Illinois.”

“It would be “unfair and deeply unpatriotic if [Walgreens] moves offshore while continuing to make its money here, leaving the rest of us to pick up the tab for its tax avoidance.”

Not surprisingly, some groups are affronted, including a union-financed advocacy group called Change to Win Retail Initiatives. The executive director of Americans for Tax Fairness, a grass-roots group, also objected.

It would be “unfair and deeply unpatriotic if [Walgreens] moves offshore while continuing to make its money here, leaving the rest of us to pick up the tab for its tax avoidance,” executive director Frank Clemente told The New York Times.

U.S. Sen. Carl Levin (D-Mich.) is already attempting legislatively to curtail inversion. Whether his outrage is joined by other politicians and rank-and-file consumers and employees remains to be seen. In the meantime, CEOs should consider the needs of all constituents before making such a decision.

Additional reading:

At Walgreens, Renouncing Corporate Citizenship

Delphi latest in fight over offshore tax shelters

More U.S. companies doing deals to avoid U.S. taxes: Congress study

In Deal to Cut Corporate Taxes, Shareholders Pay the Price

 


MORE LIKE THIS

  • Get the CEO Briefing

    Sign up today to get weekly access to the latest issues affecting CEOs in every industry
  • upcoming events

    Roundtable

    Strategic Planning Workshop

    1:00 - 5:00 pm

    Over 70% of Executives Surveyed Agree: Many Strategic Planning Efforts Lack Systematic Approach Tips for Enhancing Your Strategic Planning Process

    Executives expressed frustration with their current strategic planning process. Issues include:

    1. Lack of systematic approach (70%)
    2. Laundry lists without prioritization (68%)
    3. Decisions based on personalities rather than facts and information (65%)

     

    Steve Rutan and Denise Harrison have put together an afternoon workshop that will provide the tools you need to address these concerns.  They have worked with hundreds of executives to develop a systematic approach that will enable your team to make better decisions during strategic planning.  Steve and Denise will walk you through exercises for prioritizing your lists and steps that will reset and reinvigorate your process.  This will be a hands-on workshop that will enable you to think about your business as you use the tools that are being presented.  If you are ready for a Strategic Planning tune-up, select this workshop in your registration form.  The additional fee of $695 will be added to your total.

    To sign up, select this option in your registration form. Additional fee of $695 will be added to your total.

    New York, NY: ​​​Chief Executive's Corporate Citizenship Awards 2017

    Women in Leadership Seminar and Peer Discussion

    2:00 - 5:00 pm

    Female leaders face the same issues all leaders do, but they often face additional challenges too. In this peer session, we will facilitate a discussion of best practices and how to overcome common barriers to help women leaders be more effective within and outside their organizations. 

    Limited space available.

    To sign up, select this option in your registration form. Additional fee of $495 will be added to your total.

    Golf Outing

    10:30 - 5:00 pm
    General’s Retreat at Hermitage Golf Course
    Sponsored by UBS

    General’s Retreat, built in 1986 with architect Gary Roger Baird, has been voted the “Best Golf Course in Nashville” and is a “must play” when visiting the Nashville, Tennessee area. With the beautiful setting along the Cumberland River, golfers of all capabilities will thoroughly enjoy the golf, scenery and hospitality.

    The golf outing fee includes transportation to and from the hotel, greens/cart fees, use of practice facilities, and boxed lunch. The bus will leave the hotel at 10:30 am for a noon shotgun start and return to the hotel after the cocktail reception following the completion of the round.

    To sign up, select this option in your registration form. Additional fee of $295 will be added to your total.