Firm LGBT-Friendliness and Investor Reaction to Pulse Nightclub Shooting

Firm LGBT-friendliness reflects the attitudes of firms toward their LGBT employees, consumers, and investors. While existing literature has largely documented the positive audience reactions to that such as those from investors (Shan, Fu, & Zheng, 2017) and employees (Hossain, Atif, Ahmed, & Mia, 2020), our study argues that firm LGBT-friendliness can be both celebrity and infamy. Negative audience reactions exist and are significant during LGBT-related exogenous social events. Specifically, we choose the Pulse Nightclub Shooting as an example. The event study results show that investor reactions to firms with high-level and low-level LGBT-friendliness are more positive than reactions to firms with medium-level LGBT-friendliness in the event. The moderating effects of firm size and Twitter announcement are examined. The findings cast new light on understanding firm practices based on social values and social events.