Extract:
Corporate America has been put on guard by President Trump’s call to ferret out diversity programs, but an early batch of annual reports shows companies aren’t all buckling yet.
Streaming platform Netflix Inc., spice maker McCormick & Co., and homebuilder Lennar Corp. are among businesses that underscored the need for diversity, equity, and inclusion policies in 10-K financial statements published in the wake of a Trump executive order asking federal agencies to flag corporate diversity programs for potential investigations and lawsuits.
Signs of the corporate schism over DEI, however, are also showing up in annual reports. Meta Platforms Inc., in a 10-K filed Thursday morning, re-upped and explained its recent decision to disband its DEI team and retool diversity efforts as a means to “reduce bias.”
Those companies maintaining their diversity efforts, so far, are telling shareholders that such initiatives are essential for their bottom lines.
Companies that have pointed to diversity programs for years as a crux of their business are unlikely to end that refrain, said Atinuke Adediran, an associate professor at Fordham University School of Law who researches corporate disclosures on diversity.
“It’s really hard for you to just erase everything you’ve been saying for the past three years and just get rid of it—I think that’s very bizarre,” she said.
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The administration’s edict will further galvanize corporate diversity rollbacks that gathered speed in recent months, including how businesses talk about DEI. Companies had already been renaming or rebranding their DEI programs amid mounting conservative attacks. Trump’s order directed agencies to look for such language shifts, telling them to probe DEI programs “whether specifically denominated ‘DEI’ or otherwise.”
Conservative groups have been targeting diversity initiatives because they say such programs don’t promote equality, and instead discriminate against White or male employees by offering specific opportunities for marginalized groups.
“Trump’s executive orders are noisy and will make people think our well-established laws about sex, race and sexual preference discrimination have evaporated,” said Ann Olivarius, chair and senior partner of McAllister Olivarius. “Companies don’t want to have Trump coming after them, but they also don’t want their workers to think their bosses are racist, sexist or cowards.”
While it’s unclear how most companies will address diversity in their 10-Ks this year, every business will be considering their unique customers, employees, and shareholders as they do so, Adediran said.
It’s possible that some companies will abandon a portion of the DEI language that they included last year.