Mita Mallick, an author and leader in diversity, equity, and inclusion (DEI), released a book on workplace inclusion in October. Since then, she has experienced mixed responses from companies. While one company invited her to its leadership summit, two others, despite previously ordering copies of her book, canceled planned book talks, citing sudden discomfort among company leaders. Mallick noted the paradox of launching a book on this topic during such a tumultuous time.
In the past year, as businesses faced cost-cutting measures and conservative pressures mounted against DEI initiatives, many corporations have become more cautious about fully committing to DEI efforts. This caution, coupled with the Supreme Court’s ruling last year ending affirmative action in college admissions, has led to speculation about the future of DEI work and concerns about potential losses in progress.
Despite these challenges, experts emphasize that DEI remains essential as the U.S. population continues to diversify. Companies that prioritize DEI not only attract a broader range of talent but also experience financial benefits. While the focus of DEI efforts may evolve, experts predict that it will persist in some form.
However, there may be changes in the scope and structure of DEI initiatives. Rather than a singular focus on specific identity groups or the term “DEI” itself, there could be a broader approach. Additionally, the role of chief diversity officers, which became prominent after the murder of George Floyd in 2020, may undergo changes, with responsibilities possibly distributed across multiple departments within organizations.
Companies say they still care about DEI, even as they cut back
Despite some companies asserting their continued commitment to diversity, equity, and inclusion (DEI) efforts, data suggests a slowdown in DEI-related hiring. According to MarketWatch, the number of DEI job postings in the U.S. has decreased, indicating a potential shift in priorities within the job market.
J.P. Gownder, an analyst at Forrester, has predicted a decrease in the percentage of companies investing in a dedicated DEI function with defined strategies and personnel. This trend could lead to a rise in superficial “check the box” DEI efforts, such as heritage days, rather than substantive programs.
However, amidst this backdrop, some companies are doubling down on their DEI initiatives, giving chief diversity officers greater influence in areas like product development and overall strategy. JT Saunders, the chief diversity officer at Korn Ferry, notes a growing divide between companies with long-standing DEI commitments and those just beginning their journey.
While some companies may increase spending on DEI-related initiatives during events like Black History Month and Women’s History Month, reports indicate cutbacks to DEI programs at other companies, including Zoom Video Communications Inc., Meta Platforms Inc., and Google parent Alphabet Inc. Despite these cuts, companies assert their ongoing commitment to DEI efforts, citing strategic shifts in approach.
The broader debate over the role of businesses in addressing social inequality has led to increased scrutiny and pressure on corporations to take meaningful action. This pressure comes from both internal stakeholders and external forces, challenging companies to navigate complex social issues while maintaining public trust and brand integrity.
Affirmative-action ruling fuels attacks on corporate DEI
The aftermath of the Supreme Court’s ruling on race-conscious admissions policies in higher education has reverberated into the corporate world, prompting increased legal scrutiny of diversity, equity, and inclusion (DEI) initiatives. Chief diversity officers, initially optimistic that the ruling’s impact would be limited to higher education, have been forced to confront the broader implications outlined in Chief Justice John Roberts’ majority opinion, which emphasized the elimination of all forms of racial discrimination.
Legal challenges to DEI programs have become more prevalent. Comcast settled a lawsuit in 2022 alleging discrimination against white male business owners in its small-business-support program. Similarly, America First Legal, a group led by former Donald Trump aide Stephen Miller, filed a lawsuit against Amazon over a grant program targeting Black, Latino, and Native American entrepreneurs. Although not every legal challenge has been successful, these cases highlight the increasing legal scrutiny facing DEI initiatives.
America First Legal has targeted other companies as well, including Target Corp., alleging insufficient investor protection amid anti-LGBTQ+ boycotts over Pride-themed merchandise. Meanwhile, pressure from the group prompted PwC to allow white students to apply for scholarships initially intended to enhance workforce diversity, reflecting a broader reassessment of DEI efforts within the changing legal landscape.
Companies are adapting their diversity commitments in response to these legal challenges while navigating the evolving legal landscape. PwC, for example, has emphasized its commitment to advancing diversity in alignment with legal requirements. As legal battles over DEI initiatives continue, companies are faced with the complex task of balancing diversity goals with legal compliance and shareholder interests.
How DEI ended up on the chopping block — and how it might evolve
Efforts to undo workplace diversity initiatives existed long before the corporate world’s rush to embrace DEI in 2020. Depending on whom you ask, the roots of those efforts lie in generations-old bigotry, decades-old grievances about reverse discrimination or longstanding tensions between corporate profit and social responsibility.
After Floyd’s murder, companies raced to say — whether genuinely or performatively — that combating inequality mattered. They published statements. They inundated DEI consultants with phone calls. They hired chief diversity officers.
But those new DEI roles often weren’t set up to be effective, consultants say. The budgets, resources and authority to make hires and influence other decisions weren’t there. Neither was the training or experience, at times, for the people who moved into those newly created roles, they said. Company leaders often lacked a specific vision for what they actually wanted to do to stamp out workplace discrimination.
So by the time 2022 and 2023 rolled around — amid the anti-DEI attacks and investor agitations for stronger profits — companies that didn’t know what they wanted in the first place often targeted DEI-related departments for layoffs and cost cuts, experts say.
“When you don’t build inclusion into the business, and you don’t have metrics, it’s very easy to cut it and say that it didn’t work,” Mallick said.
Mallick said that against that backdrop, some companies could divide up their DEI duties and hand them off to other departments. A chief diversity officer role, for instance, could be turned into the chief communications and inclusion officer, or chief marketing and inclusion officer, or a chief supply-chain and inclusion officer.
Those roles could drive home diversity in different ways, she wrote in Fast Company in October — by guiding company leaders on how and when to speak with employees on bigger issues, marketing to a broader array of consumers and marginalized populations, and doing business with companies that have a more diverse workforce.
Others have proposed a more holistic framework for approaching DEI that centers on employee welfare. Laura Morgan Roberts, an associate professor of business administration at the University of Virginia, wrote in a Harvard Business Review article that “to bring advocates and critics of this work together, leaders must orient around a broader goal: creating the conditions for all workers to flourish.”
Those conditions, she said, should allow employees to be not just themselves but the best version of themselves, via anti-discrimination training and more concerted, constructive feedback. She said they also need the freedom to fail and the freedom to step back from pressure to perform at maximum productivity. Hybrid work and a more diverse workforce, which she said would help people in marginalized groups “blend in to escape scrutiny,” could make achieving the latter easier. But those freedoms often don’t filter down to women, people of color, people with disabilities and LBGTQ+ people, she added.
But as DEI practitioners try to rethink their jobs, they worry that a less direct approach risks sacrificing focus and accountability.
“The one thing that can be lost is the one thing that everyone’s talked about, which is the level of authority and prominence that DEI has in an organization,” Hayes said.
Companies “need a person who owns it, who’s responsible for it,” said Y-Vonne Hutchinson, the founder of the DEI consulting firm ReadySet. “Anytime we go into an organization as ReadySet, and there’s no one person responsible or accountable for these things, they lose momentum.”
DEI work overall needs to be reimagined, Hutchinson said. But she also said that while executives have often dismissed DEI as a feel-good function, it is in fact a discipline backed by research on how workplace dynamics differ depending on a person’s identity and what types of interventions work.
“I have yet to meet a traditional marketer that is going to write the right statement for the Israel-Palestine conflict,” she said. “Like, good luck.”
Demand for DEI has also endured in areas where the climate for it has been harsh. Hutchinson said that she still gets requests to do work in Texas, which has outlawed DEI work in its public colleges. Companies still don’t know how to talk to Gen Z, a generation likelier to look for more than just gestures toward diversity, she said.
She added that increasingly, people are unable to work with one another over political issues — be it over the Israel-Hamas war or this year’s presidential election — and politics still affect co-workers’ lives even if managers would prefer they keep it out of the workplace. A turn away from DEI risks also being a turn away from the people who might be able to handle those disputes, she said.
That turn could also force DEI opponents, many of whom have said the workplace should be a “colorblind” meritocracy, to say what specific alternatives they actually want in its place, she said.
“Meritocracy never existed in this country,” Hutchinson said. “DEI was created to address some really deep-seated biases and wrongs that exist in organizations. If you get rid of it, those biases still exist, and DEI opponents have no solutions for it.”
‘Let’s talk about the things we can do on purpose’
Workplace programs that explicitly use race or another protected classification to focus on one group of people — say, fellowships designated for people of color — are in the biggest legal jeopardy,” Yoshino said. Putting staff through unconscious-bias training before they make hiring decisions, however, is likely still on solid legal ground.
Corporate retreats open only to women or people of color, he said, could be vulnerable to a reverse-discrimination suit. But opening up such gatherings to the broader workforce comes with its own compromises — including the loss of “that safe space that used to exist in those retreats,” he said.
“You lose the sense of psychological safety,” he said, “because everyone here is a person of color, and we can talk about concerns that we have as people of color without worrying that other people are listening who don’t have our life experience or shared demographic characteristics.”
Companies can still create programs that advance “socioeconomic diversity,” since socioeconomic class isn’t protected by anti-discrimination laws, Yoshino said in a recent Harvard Business Review article co-authored with David Glasgow, an adjunct law professor at New York University. Taking some steps to foster a deeper sense of employee belonging overall without crimping opportunity — such as establishing all-gender bathrooms and nursing rooms, widening college outreach to draw from a more diverse talent pool and supporting organizations committed to DEI — would serve as a “safe harbor” to current legal attacks, the authors added.
Some also say the changes could help create a deeper sense of shared responsibility in making companies more inclusive. Yoshino told MarketWatch he still sees ways to make DEI work, even with potentially greater legal constraints.
An anti-DEI lawsuit, he said, could bring chief diversity officers and chief executive officers together, jolting leaders into paying more attention to a company’s DEI plans. Opening up programs to a broader audience could help ease anxieties, namely among white men, that DEI initiatives are stacked against them. A bigger audience also means more people, he said — including potential allies who might have less fear of retaliation from their bosses and might empathize with and advocate for marginalized groups.
LaToya Rose, the senior vice president of diversity, equity and inclusion at the publisher Macmillan, suggested that companies could learn from what their peers are already doing well and reconsider certain tropes of DEI, like unconscious-bias training.
“Maybe that’s not the conversation, and it’s about what are we consciously doing,” she said. “Is there conscious inclusion? Let’s not talk about what we do unconsciously. Let’s talk about the things we can do on purpose.”