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By Sabrina Escobar

Politics can be toxic for stocks, and CEOs know it.

Over the weekend, CEOs of Minnesota companies broke their silence on the tension in the Twin Cities after weeks of conflict between protesters and ICE agents culminated in the second fatal shooting in less than a month. How they did it highlights the current challenge American corporations faces when navigating hot-button issues.

There may be safety in numbers. On Sunday, more than 60 executives from companies based in Minnesota — including 3M, Allianz Life Insurance, Ameriprise Financial, Best Buy, General Mills, Piper Sandler, Target, and UnitedHealth Group — signed a letter calling for an "immediate de-escalation" of tensions. The letter, released by the Minnesota Chamber of Commerce, follows the fatal shooting of Alex Pretti, a 37-year-old U.S. citizen, by a federal agent over the weekend.

"With yesterday's tragic news, we are calling for an immediate de-escalation of tensions and for state, local and federal officials to work together to find real solutions," the letter reads. The current standoff between protesters and federal agents, including from Immigration and Customs Enforcement, has "created widespread disruption and tragic loss of life," it said.

While Minnesota is home to 18 Fortune 500 businesses, most large companies had refrained from commenting either on the immigration crackdown or the protests, perhaps afraid to spark a backlash from either side of the political spectrum. But pressure to speak up intensified as a result of the weekend's events, including the shooting, citywide protests, and a strike led by hundreds of small businesses.

Target has been under more pressure than most after immigration officials briefly detained two employees inside a Minneapolis Target store. Activists have flocked to the company's headquarters and stores, requesting the company to "take action" against ICE, such as by banning federal agents from stores and parking lots.

The company hasn't publicly addressed the concerns outside of the Chamber of Commerce letter. In a video sent to employees Monday, incoming CEO Michael Fiddelke said the company was doing what it could to manage what was in the company's control, keeping the safety of staff and customers as a priority. He also said he has been meeting with a range of leaders.

"The violence and loss of life in our community is incredibly painful. I know it's weighing heavily on many of you across the country, as it is with me," Fiddelke said, according to a transcript of the video the company shared with Barron's.

The Department of Homeland Security, which oversees both ICE and Customs and Border Protection, didn't immediately respond to a request for comment.

Companies like Target may be betting that a unified response will better insulate them from any fallout stemming from speaking out, while somewhat addressing the community's concerns. The letter doesn't seem to take sides, emphasizing instead the need for cooperation that would allow "families, businesses, our employees, and communities across Minnesota to resume our work."

The business community has been working behind the scenes with federal, state, and local officials to "advance real solutions," it said.

That middle-of-the-road phrasing is a result of the rising perils of wading into hot-button issues in recent years. The aftershocks of boycotts of companies such as Target, Anheuser-Busch, and Starbucks in the postpandemic years serve as reminders that angering consumers from either side of the political spectrum can have lasting effects on a brand's top-line growth — and its share price.

All three companies' stocks saw big declines in response to boycotts. Making up the lost ground has taken years.

Since the 2024 election, executives also have to contend with the additional risk of drawing ire from President Donald Trump, who in his second term has taken action against people, companies, and countries that oppose his agenda.

Early in his term, dozens of companies rolled back diversity, equity, and inclusion initiatives in response to pressure from the administration, only to face boycotts from liberal consumers, including a 24-hour "economic blackout" last February.

While tensions in Minnesota will eventually cool off, business will likely continue to walk a fine line with getting involved in political issues in the years to come. Investors should also tread carefully, keeping an eye out for potential blowback.

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