It might seem like corporate America is stepping back from its commitment to diversity, equity, and inclusion (DEI) initiatives, especially when you read about companies like Tractor Supply, Boeing, and even Target scaling back. However, these programs are not disappearing; they’re merely transforming.
Contrary to what some headlines suggest, the notion that DEI initiatives are being scrapped isn’t backed by numbers. The reality is, only a small fraction of companies have officially moved away from their diversity programs. According to the conservative Heritage Foundation, a staggering 486 out of the Fortune 500 companies still prominently feature their inclusion commitments online. Various independent surveys conducted in 2024 also reveal strong support for equity efforts among corporate leaders.
In my experience as a finance industry professional tracking these developments, it’s clear that most large organizations remain dedicated to these principles. They are simply adapting their strategies, conducting their DEI efforts more discreetly to avoid unnecessary legal challenges and public scrutiny.
Even those companies that seem to retreat from DEI initiatives often continue their efforts in subtle ways. Take Ford’s memo, for instance, which underlined its ongoing commitment to fostering an inclusive work environment and developing a diverse network of dealers. Lowe’s made similar pledges to create a welcoming and respectful atmosphere, aligning itself closely with American diversity and consumer demographics through an inclusive talent search. Walmart might have phased out the term “DEI” from its corporate communications, but it still emphasizes a goal of fostering belonging and providing opportunities for everyone involved with the company. These commitments sound remarkably like DEI in action.
Most businesses are simply tweaking their language or practices without abandoning the underlying objectives. Over recent years, the path to diversity has faced more resistance. The Supreme Court’s decision in June 2023 regarding affirmative action sparked a wave of legal challenges to inclusion efforts. Meanwhile, some activists and investors pushed companies to reassess their diversity endeavors, especially after a recent executive order from former President Trump suggested federal investigations into companies practicing “illegal discrimination and preferences” in their diversity programs.
With these rising legal and reputational risks, many companies have understandably sought to protect themselves. Despite this, as seen with Costco and Apple, some have used these challenges as a platform to reiterate their dedication to inclusion.
Nonetheless, organizations realize that turning away from DEI goals poses its own set of risks, such as backlash from progressive groups and employees, hiring challenges, and potential lawsuits from historically marginalized groups. Awareness of general public opinion also matters; most Americans may oppose factoring race or ethnicity into hiring and promotion, but the majority do support diversity initiatives when presented as means of unlocking potential for all.
Diversity efforts in corporate America have always been about addressing genuine challenges, and these challenges will only become more pronounced. The U.S. is rapidly diversifying racially and ethnically. Women now represent a majority of the college-educated workforce, and nearly 30% of Gen Z adults identify as LGBTQ+. To succeed in this diverse environment, businesses must ensure equal opportunity and help employees navigate differences with dignity and respect. This is why diversity initiatives continue to thrive—they deliver tangible benefits.
The evolution of DEI strategies isn’t new. As sociologist Frank Dobbin notes in “Inventing Equal Opportunity,” diversity management gained prominence after the Reagan administration’s assault on affirmative action in the 1980s. This forced a rebranding of diversity work, but the core objectives remained intact. History appears to be repeating itself now.
Why then, do so many believe the narrative that DEI is on its last legs? There are several reasons. Firstly, those against inclusion programs push this narrative, hoping it will sway hesitant leaders to abandon their values. Secondly, news stories thrive on drama. Just as reporters focus on plane crashes rather than landings, a high-profile company’s withdrawal from diversity work makes for compelling headlines, even if hundreds of other companies continue their efforts quietly. Lastly, it could be that some organizations strategically project a retreat from DEI efforts to deflect activist pressure, avoiding public disputes while maintaining the essence of their programs internally.
Looking ahead, it’s likely we’ll see more companies publicly distancing themselves from certain DEI practices or even the “DEI” acronym, as Walmart has done. But upon deeper examination, many of these “new approaches” still align closely with DEI principles. Just because the terminology changes doesn’t mean the mission does.
Kenji Yoshino and David Glasgow, both of whom are leaders at the Meltzer Center for Diversity, Inclusion, and Belonging at NYU School of Law, co-wrote “Say the Right Thing: How to Talk About Identity, Diversity, and Justice.”
