Published by The Wall Street Journal on 1/4/24; Story by Ray A. Smith and Lauren Weber

DEI programs have come under fire from many directions

The management philosophy known as DEI, which had gathered momentum since 2020, has been under siege over the past year amid a collision of legal, economic and geopolitical forces. 

The Supreme Court struck down affirmative action in colleges, removing the legal rationale buttressing many diversity programs. An expected slowdown in the economy prompted companies to cut jobs and financial support for diversity, equity and inclusion initiatives. And the Israel-Hamas war and college presidents’ responses to antisemitism on campus led some to question whether DEI programs and the values behind them extended to all students.

This week brought the resignation of Harvard University President Claudine Gay, whose championing of diversity initiatives made her a target of conservative critics. Gay, Harvard’s first Black female president, had come under additional fire in recent weeks for allegations of plagiarism and for congressional testimony in which she and other college presidents struggled in their responses to questions about antisemitism on campuses. 

Also this week, Texas became the second state, after Florida, to ban DEI initiatives at publicly funded colleges and universities. Texas A&M University had already announced in the fall that it closed its DEI office and reassigned the team’s staff members. 

It isn’t clear whether the upheaval of the past year will have a broad and lasting impact on how companies and colleges approach diversity. Some DEI consultants say the scrutiny surrounding such efforts in academia could have a chilling effect on corporate diversity initiatives, emboldening critics to take them on. Others maintain that DEI is resilient. 

“I do expect we’ll see activists targeting companies and leaders who have been outspoken on the importance of diversity and inclusion,” said Joelle Emerson, CEO of Paradigm, a provider of consulting services and analytic tools that has worked with organizations including American Express, Grubhub and the National Football League on their DEI efforts. 

“In our work, we’ve already seen this start to happen. I’ve heard a number of leaders at Fortune 500 companies say that they’re planning to continue their diversity and inclusion efforts, but just plan to be quieter about what they’re doing.”

Affirmative action

The Supreme Court’s June decision to strike down affirmative action in college admissions boosted efforts by conservative groups to fight initiatives in the corporate sphere designed to rectify imbalances in the workplace, from hiring targets to fellowship and internship programs reserved for people from underrepresented groups. 

Since the high court’s decision, conservative activists have launched a string of legal challenges against companies, including Starbucks and Amazon, targeting DEI programs they say violate rules against race and sex discrimination by steering opportunities or funds to racial and ethnic minority groups. Some companies have made changes to diversity initiatives. 

Comcast altered a small-business grant program to minority- or female-owned companies to make all small businesses eligible after the cable company was accused of violating the civil rights of white, male business owners. 

Companies are largely maintaining their programs or making only small alterations to address the areas where they see the most potential legal or reputational risk, said Ishan Bhabha, an attorney at Jenner & Block and co-chair of the firm’s DEI Protection Task Force. “There’s less backing away than one might think and I’ve actually been surprised by it,” he said. 

A principal aim of the conservative assault on DEI programs, he said, is to create the perception in the corporate world that the legal liability is broader than it actually is “so that companies back away voluntarily from programs that are completely legal and were totally uncontroversial even a couple of years ago.”

Corporate cuts

Demand for chief diversity officers surged after the murder of George Floyd in May 2020 sparked a wider examination of racial inequity at work. Diversity executives arrived with big mandates, healthy budgets and momentum on their side. 

Many found resources and support from senior executives waned over time, and dropped off sharply after the Supreme Court decision and a slowdown in the economy that prompted companies to cut corporate staff. In some cases, DEI-related roles were among the first to be eliminated when companies pulled back on hiring broadly because these initiatives were often tied to recruiting.   

Many chief diversity officers left their jobs and their teams dwindled. Nearly 30% of workers who began a diversity-related role after mid-2020 have left the field altogether, according to employment data provider Live Data Technologies.

The advancement of Black professionals has stalled as well. Recent data from McKinsey show promotion rates for Black staff have fallen back near 2019 levels. 

“DEI is going to come under full-out attack in 2024, no holds barred,” said Johnny C. Taylor Jr., the CEO of SHRM, an association for human resource managers, at a December breakfast with journalists in New York City. 

The organization highlighted DEI as one of the top issues companies would be grappling with in the new year. Taylor said companies are already moving away from DEI efforts, especially those efforts tied to numeral targets for hiring or promotions of Blacks and other people of color or base executive bonuses on those targets.

The Israel effect

A pro-Palestinian movement on college campuses in the wake of the Oct. 7 attack on Israel by Hamas has elevated criticism of some aspects of the DEI movement. 

Critics say colleges focused on the goals of DEI have cultivated an environment where students see the world as divided between the oppressed and their oppressors, leading to an anti-Israel or anti-Jewish sentiment on campuses. 

At a congressional hearing in December in which Gay and other university presidents were questioned about antisemitism on their campuses, some Republican lawmakers drew a direct line from schools’ DEI initiatives to antisemitic harassment, vandalism and assaults. Their argument, in part, is that these initiatives have been overly focused on race and gender, at the expense of other groups that are victims of bigotry. 

“Institutional antisemitism and hate are among the poison fruits of your institution’s cultures,” said Rep. Virginia Foxx (R., N.C.) at the hearing, where both Democrats and Republican lawmakers were critical of the leaders’ handling of the problems. 

Some workers report feeling similar concerns in their workplaces, said Rory Lancman, director of corporate initiatives and senior counsel at the Louis D. Brandeis Center for Human Rights Under Law, which fights antisemitism. 

His organization is fielding calls related to several workplace themes, he said, including “anti-Israel and anti-Zionist animus” driven by the Israel-Hamas war, leading to what some employees say they are experiencing as a hostile work environment.

In addition, he said, “Jewish concerns and antisemitism have been erased from corporate DEI programs to the point where there is no training on combating antisemitism.” Some workers are also finding that their requests to have workplace affinity groups, also known as employee resource groups, are being denied, often on the grounds that companies have a policy of not allowing religiously-based employee groups.