As scrutiny continues to be on Massey Energy (NYSE:MEE) in relationship to the tragic explosion which resulted in 25 deaths of miners in West Virginia, companies like Bank of America (NYSE:BAC) are under increasing pressure to break ties with them.
In the emotionally volatile situation, many shareholders and others are putting pressure on companies involved with Massey to stop doing business with them, which could be perceived or spun as aiding them in what happened; something no company is going to allow to happen.
My only problem with that is it’s premature to do this, as rescuers are still attempting to find four miners whose fate is unknown at this time, and from there an investigation will have to take place to determine the cause of the explosion.
Even so, that probably isn’t going to happen because of it being a no-win situation for any company which would be brought into the spotlight as having a connection to Massey, which would then be attempted to be brushed with the taint now on the company.
While that’s unfair at this point, it’s the reality, and whatever the outcome of what has happened is found to be, for now we’ll probably see a great distancing of companies from Massey, although they have to be careful in doing that, depending on whether there are agreements in place concerning doing business with them, which could result in legal problems. It could be a tightrope to walk for some companies, and not as simple as it seems to those pressuring from the outside.
For Bank of America, with their barely leaving the stain of the economic crisis, it’s doubtful if they’ll retain their relationship with Massey, as the last thing they need is to be painted with the same brush as they are being painted with when they are still attempting to rebuild their own reputation.
