More than 200 chief diversity officers, some from Fortune 500 companies and others from nonprofits, gathered last summer at NYU Law School and on video to talk about the future of their diversity, equity and inclusion or programs DEI, which had become a legal and social target. Anxious, they wondered how to do it they protect themselves. Did they need to rethink internship programs for underrepresented workers or drop some diversity language from their websites?
Those concerns rose sharply this week. In his first days in office, in a series of sweeping moves, President Trump has targeted diversity efforts.
Mr. Trump ordered federal officials overseeing the government’s DEI efforts to be placed on leave. His efforts did not stop with government employment. He revoked an executive order signed in 1965 that prohibited discriminatory hiring and employment practices for private government contractors. Perhaps most troubling to business leaders was the mandate’s focus on private companies, whether they do business with the government or not. “We’re already seeing that this flurry of orders has created fear and confusion,” said David Glasgow, executive director of the Meltzer Center for Diversity, Inclusion and Belonging at NYU Law.
The executive order directs the federal government to review private-sector DEI initiatives: Each federal agency, it says, will identify “up to nine potential compliance investigations on policy compliance issues” that could include publicly traded companies, nonprofits and large institutions, among others.
“This discrete number is a way to strike fear into the hearts of organizations,” said Kenji Yoshino, a constitutional lawyer at NYU who advises some Fortune 500 companies on DEI “They just don’t want to be one of those nine. Until these nine are announced, it will make others risk-averse.”
Civil rights lawyers believe that DEI programs that are most legally vulnerable are those that provide employment benefits, such as jobs or promotions, to specific groups based on their race. In 2023, a Supreme Court ruling struck down racial preferences in college admissions and was followed by a wave of lawsuits against companies’ diversity efforts.
With the executive order, Mr. Yoshino said, “Trump is putting executive muscle” behind the 2023 Supreme Court ruling.
Many companies, reading the writing on the wall, had begun to change their approaches to PPC before Mr. Trump his duties. Meta told employees earlier this month that it would end its work at DEI, including eliminating the role of Chief Diversity Officer and eliminating diversity hiring goals. Tractor Supply, John Deere and Harley Davidson also caved to DEI. Amazon also recently scaled back some of its diversity programs, with a vice president, Candi Castleberry, writing in a memo to staff in December: “We eliminated outdated programs and materials.”
Some companies, including Walmart, have said they will stop sharing data with the Human Rights Campaign, a nonprofit that monitors corporate LGBTQ policies.
Mr. Yoshino said he doesn’t believe sharing data with the Human Rights Campaign presents a legal risk, and believes companies withdrawing that commitment are doing so to avoid social upheaval. It also deems several other DEI programs legally safe, including unconscious bias training and fellowships or retreats dedicated to advancing employees of color but open to anyone.
Nearly a dozen companies did not respond to requests for comment about the future of their DEI programming, and some declined to comment citing fear of drawing attention to their work.
A managing director at law firm Jenner & Block, Ishan Bhabha, said since the executive order was issued that he has received “tons” of calls from clients concerned about whether their DEI programs are in compliance. He said it’s early and there may be legal challenges to the executive order or the administrative actions that follow it, but “an executive order like this gives a good idea of what this administration’s priorities are going to be.”
The White House did not respond to a request for comment, but the text of the executive order condemned the policies of the “illegal DEI,” saying they “deny, discredit, and undermine traditional American values of hard work, excellence, and individual achievement in favor of an illegal , corrosive and pernicious identity-based loot system.”
A number of companies have consistently supported DEI, including Costco, Patagonia and Microsoft. For those chief diversity officers doubling down on their work, there’s a new sense of isolation, as well as whiplash. Less than five years ago, after the killing of George Floyd in May 2020, dozens of companies began announcing new commitments to combat racial injustice. Walmart created a Center for Racial Equality. Consulting firm Bain has launched a new PPC practice. Glassdoor reported a 54 percent increase in job openings for DEI positions in 2020, compared to pre-pandemic levels.
Some diversity leaders have begun to think of ways companies can continue their efforts without attracting legal scrutiny. Mr. Glasgow said he’s starting to wonder if it’s time to ditch the term “DEI,” now that those three letters have become so politically charged.
“If you asked me a year ago, I probably would have said don’t change it,” said Mr. Glasgow. “Over time, I’ve become a little more convinced that the acronym might not be useful because empty terms make easy targets.”
Those trying to salvage the goals behind the DEI programs said they are trying to remain optimistic despite the chill in their field.
“The backlash was against a very narrow range of activities,” said Bo Young Lee, who was formerly Uber’s diversity chief and is now president of research and consulting at AnitaB.org, which advocates for women and non-binary people. in technology. That “narrow zone,” he said, included sharing data with the Human Rights Campaign’s index, as well as offering internships for racial and LGBTQ minorities. He sees paid parental leave, for example, as a diversity policy that is now deeply embedded in corporate culture and safe from attack.
Denise Young, former head of global human resources; at Apple, he said corporate diversity leaders face a more complex environment for their work, but he believes most will find ways to continue to bring in diverse talent because they know it’s good for business.
“It’s the political environment we live in now, but it doesn’t change the needs of business,” Ms. Yang. “Talent comes in every form of human existence.”
