The Rise and Fall of DEI in Corporate America: Why Equity Is at Risk

In 2020, the murder of George Floyd sparked global calls for justice and accountability, pushing corporate America to address its role in systemic inequities. Companies pledged billions to Diversity, Equity, and Inclusion (DEI) initiatives, hiring Chief Diversity Officers, creating inclusive programs, and committing to systemic change. For a moment, progress seemed possible.

Fast-forward to today, and that momentum is crumbling. Walmart, the world’s largest retailer, recently announced a rollback of its DEI policies, including cutting funding to its Center for Racial Equity. Other major companies, such as Ford and Lowe’s, have followed suit. Economic pressures, political backlash, and shifting priorities have led many corporations to retreat from their commitments to inclusion.

This shift has consequences for marginalized communities, workplace culture, and the broader fight for equity. Understanding the reasons behind these rollbacks—and how to take action—is critical.

A Fragile Commitment

Corporate America’s post-2020 DEI commitments were heralded as a step forward:

• 75% of Fortune 500 companies launched or expanded DEI initiatives.
• Job postings for DEI roles surged by 55%, signaling a push to institutionalize equity-focused programs. (Source: LinkedIn Economic Graph)

However, by 2023:

• DEI-related job postings fell 38%, reflecting a decline in corporate interest.
• Walmart, for example, scaled back its DEI metrics, including removing requirements related to supplier diversity and reducing involvement in LGBTQ+ initiatives. (Source: AP News)

In a Fox News report, analysts highlighted how these trends reflect a response to growing political and economic pressures. DEI, once seen as a business necessity, is now treated as expendable.

Why Are DEI Programs Being Rolled Back?

1. Economic Pressures
   As companies brace for potential recessions, many are cutting “non-essential” budgets. DEI programs are often the first to go. This short-sighted strategy ignores the proven benefits of diversity in leadership. According to McKinsey, businesses with diverse teams are 35% more profitable, underscoring the economic value of inclusion.
2. Political and Legal Challenges
   Recent Supreme Court rulings and state-level legislation have challenged the foundations of DEI programs. Conservative activists have actively campaigned against corporate DEI efforts, framing them as divisive. Walmart’s rollback came amidst rising legal and cultural scrutiny. (Source: NBC10 Boston)
3. Lack of Measurable Impact
   Many companies have struggled to quantify the success of their DEI initiatives. Without concrete metrics, DEI programs are more vulnerable to criticism and budget cuts.

The Impact on Marginalized Communities

For employees from underrepresented groups, the rollback of DEI programs leads to significant setbacks:

• Leadership Representation
  Black women hold just 1.4% of executive positions in Fortune 500 companies. Without deliberate efforts to promote diversity, these numbers remain stagnant. (Source: Catalyst)
• Wage Gaps
  Black women continue to earn 64 cents for every dollar earned by White men, highlighting systemic inequities that DEI programs aim to address. (Source: AAUW)
• Workplace Culture
  Employees in diverse workplaces report being 47% more engaged, fostering higher retention and productivity. However, DEI rollbacks threaten to reverse these gains. (Source: Harvard Business Review)

In a WTHR interview, an HR leader explained how employees in inclusive environments experience better morale, creativity, and innovation. When DEI initiatives are scaled back, these benefits are at risk.

The Risks for Corporate America

Businesses that roll back DEI programs risk damaging more than just their reputation:

• Loss of Innovation
  Companies with diverse leadership teams outperform their peers financially. Scaling back DEI undermines a critical driver of success.
• Talent Retention Issues
  According to Glassdoor, 70% of employees value diversity when considering employers. Companies that deprioritize inclusion may struggle to attract and retain top talent.
• Reputation Damage
  Consumers expect companies to align with their values. Scaling back DEI initiatives can lead to public backlash and lost loyalty.

By contrast, companies like Ben & Jerry’s demonstrate the benefits of maintaining their commitments to equity. Despite economic challenges, they continue to allocate 7.5% of their pre-tax profits to racial and social equity programs. Their transparency and grassroots partnerships have strengthened their reputation and customer loyalty.

What You Can Do

While corporate rollbacks are concerning, individuals and communities can take steps to sustain equity:

1. Hold Companies Accountable
   Research DEI metrics through platforms like Glassdoor or LinkedIn. Share your findings to demand transparency and action.
2. Support Grassroots Movements
   Volunteer or donate to organizations advancing equity at the local level. Grassroots efforts often succeed where corporate initiatives falter.
3. Advocate for Inclusion
   Push for inclusive practices in your workplace or community. Mentor underrepresented colleagues, advocate for policy changes, or lead DEI-focused discussions.
4. Amplify Voices
   Follow and share content from DEI leaders and organizations. Amplifying their work keeps equity at the forefront of public conversation.

The rollback of DEI initiatives is a reminder of how fragile progress can be. However, equity does not depend solely on corporations. It thrives when individuals, communities, and organizations step up to ensure fairness and inclusion are sustained.

As one expert shared in Steffanie Rivers’ commentary: “Equity is about building systems where everyone has a chance to succeed. It starts with each of us taking action.”

The path forward requires vigilance, collaboration, and commitment. What role will you play in shaping this future?