The News
Just days into his term, US President Donald Trump has waged war on government and private-sector diversity, equity, and inclusion efforts. Trump has ordered federal diversity offices to close and put DEI staff on leave, as well as signaling private corporations could be investigated over their own initiatives.
Speaking to business leaders at the World Economic Forum in Davos on Thursday, Trump renewed his attacked on the programs, calling them ”absolute nonsense.”
The political pushback to DEI has ramped up pressure inside board rooms — and many firms have shifted their stances. Meta and McDonald’s, for example, scrapped their DEI programs in recent weeks. Others are standing by diversity efforts in some form, even as they sour on the “DEI” label.
SIGNALS
Some major US firms stand by diversity efforts
The boards of retail giant Costco and tech company Apple have both pushed back on shareholder proposals from a conservative think tank targeting DEI. Costco investors were set to vote Thursday on the proposal, with the outcome closely watched by other corporate boards. Asked at the World Economic Forum in Davos about anti-DEI activists targeting JPMorgan Chase, CEO Jamie Dimon said: “Bring them on.” But, he added, “I don’t like monikers,” before detailing the company’s commitment to climate efforts, communities of color, and LGBTQ groups. Conservative activist Robby Starbuck similarly acknowledged Wednesday that DEI is not “dead,” but is “cornered and in a position to die.”
Others move to use a different label
Opposition to DEI workplace practices spurred some corporate leaders in Davos to modify how they talk about them, Reuters reported. An adviser to Bangladesh’s interim government said DEI and ESG — “environmental, social, and governance” initiatives — “became toxic,” adding that “I’m more interested in what is effective, how do we get to the result as opposed to the label.” Bankers at Davos also predicted ESG funding won’t fully disappear because of Trump’s return. Many companies will still dedicate resources to sustainability and climate, even while some “walk back their messaging” or tweak their goals, a S&P Global report forecast. That’s partly because regulators and investors will still expect information on “factors that will impact the long-term success of a business.”
Trump orders could still have chilling effect
Trump’s directive that private corporations could face investigations over “illegal” DEI programs sent shockwaves through corporate America: One lawyer who represents large companies told The New York Times he has gotten “tons” of calls from clients worried about compliance. The head of a New York University diversity-focused research center suggested companies could avoid legal scrutiny by simply changing the name of their programs, “because empty terms make easy targets.” Regardless, legal experts expect court challenges. “It’s going to be a really crazy ride,” an American University law professor said.