North Carolina moved Tuesday to curtail a law targeting gay and transgender people, but stopped short of ending limits to public bathroom access following a growing backlash from companies and celebrities.
In an executive order, Republican Governor Pat McCrory said he had "expanded" the southeastern US state's equal employment opportunity policy to include sexual orientation and gender identification.
He also vowed to seek legislation restoring the right to sue for discrimination in North Carolina.
But McCrory left intact the bill's most high profile and controversial provision -- which requires transgender people to only use public restrooms that correspond with the gender on their birth certificates.
"It maintains common sense gender-specific restroom and locker room facilities in government buildings and in our schools, and when possible, encourages reasonable accommodations for families and those who have unique or special circumstances," he said in a video message.
The governor defended the state law, which he signed last month, as necessary for responding to the "government overreach" of an ordinance in the state's largest city of Charlotte that expanded legal protections for transgender people.
His executive order followed a major backlash that saw stars like Bruce Springsteen cancel concerts and online payment giant Paypal drop plans to invest millions of dollars in the state.
The National Basketball Association (NBA) and other sports groups also warned they would consider moving events outside of the state, while Hollywood directors and producers signaled their opposition to film in North Carolina.
"The private sector can make its own policy with regard to restrooms, locker rooms and/or shower facilities. This is not a government decision. This is your decision in the private sector," McCrory said.
But that had not been in doubt since the law's most controversial component dealt with public facilities, allowing the private sector to make its own decisions.
The reforms to the measure were announced just hours after Germany's Deutsche Bank said it was freezing plans to create 250 new jobs in the state because of the law.
"Simply put, I have listened to the people of North Carolina, and the people of North Carolina are entitled to both privacy and equality. We can and we must achieve both of these goals," McCrory said.
"North Carolina proudly welcomes all people to live, work and visit our great state."
There has been a flurry of initiatives targeting the lesbian, bisexual, gay, transgender and queer (LGBTQ) communities since a historic US Supreme Court decision last year legalizing gay marriage nationwide.