DEI initiatives: Is corporate America courting favour with Donald Trump?

Meta, McDonald's, Walmart, Boeing, and Ford—an expanding roster of American giants—are retreating from diversity, equity, and inclusion (DEI) initiatives. This growing trend signals a significant shift among corporate leaders, especially in Silicon Valley, as Donald Trump is returning to the presidency.

Is corporate America swiftly realigning their policies to court favour with the incoming administration?

DEI policies have long been viewed as a counterweight to discriminatory practices in the American corporate world. Their foundation can be traced back to the civil rights movement, which sought to eradicate racial segregation and discrimination. Key legislative milestones, such as the Civil Rights Act of 1964 and the Equal Employment Opportunity Act, prohibited discrimination based on race, colour, religion, sex, or national origin.

In the 1970s and 1980s, affirmative action emerged as a tool to promote equal opportunity in employment. By the 1990s, a significant cultural shift saw American organisations embrace multiculturalism, leading to a sharp increase in corporate spending on diversity initiatives by the early 2000s.

During his 2016 presidential campaign, Donald Trump vowed to scale back DEI initiatives. True to his promise, in September 2020, the Trump administration issued an executive order restricting the federal government and its contractors from offering diversity training, which Trump labelled as "divisive" and "un-American."

In contrast, the murder of George Floyd in May 2020 ignited widespread civil unrest, sparking the largest protests against racial injustice since the civil rights movement. In response, many companies made substantial commitments to DEI efforts, leading to a surge in funding during that period.

In the 2020 presidential election, Donald Trump lost, and on January 20, 2021, his first day in office, Joe Biden revoked the restrictions on diversity training for federal agencies and contractors. Back then, nobody anticipated a political comeback for Trump.

However, Trump made a comeback, and during his 2024 campaign, he clearly articulated his intention to dismantle DEI initiatives at the federal level. He announced plans to fire government employees involved in DEI programs and pledged to direct the Department of Justice to pursue civil rights cases against educational institutions that he claimed engaged in racial discrimination under the guise of equity.

Trump also declared that he would hold universities accountable for what he described as unlawful discrimination disguised as equity efforts.

Notably, on June 29, 2023, the US Supreme Court ruled against affirmative action in college admissions, striking down race-conscious admissions policies at Harvard University and the University of North Carolina. And, now companies like Meta have cited this ruling as justification for rolling back their DEI programs.

“The legal and policy landscape surrounding diversity, equity and inclusion efforts in the United States is changing. The Supreme Court of the United States has recently made decisions signalling a shift in how courts will approach DEI. It reaffirms longstanding principles that discrimination should not be tolerated or promoted on the basis of inherent characteristics.

The term "DEI" has also become charged, in part because it is understood by some as a practice that suggests preferential treatment of some groups over others,” read the META’s memo to its employees as reported by Axios.

Notably, many believe that it is not just the legal and policy landscape but also the changed political climate that is influencing firms like Meta to alter their policies.

Figures like Elon Musk are playing a significant role in shaping this new landscape empowering conservative voices. In September, Musk declared, "DEI must die," arguing that such programs create new forms of discrimination rather than addressing existing inequalities.

In January, following the widespread destruction caused by wildfires in Los Angeles, Musk seized the opportunity to criticise DEI. He supported conservative activist Robby Starbuck's claim that DEI initiatives worsened the fire damage by diverting funds from essential services needed to combat wildfires.

Back in July 2024, when Trump survived an assassination attempt, conservatives had attacked DEI efforts at the US Secret Service highlighting videos and photos where the female agents appeared slow to react during the shooting incident in Butler, Pennsylvania.

US Secret Service director Kimberly Cheatle, who had been targeted by the conservatives for her DEI initiatives in the agency, had to finally step down taking responsibility for not preventing the attack against Trump.

It is undeniable that many, including some from the Indian-American community, see Trump’s promises as efforts to establish meritocracy as the defining yardstick of American life.

However, another group believes that the upcoming Trump administration's ultimate goal could be the elimination of all programs aimed at addressing historical inequalities in American society—from schools to corporations.

Which argument holds true? Only time will tell.