In the wake of Donald Trump’s return to the White House and his subsequent executive orders targeting Diversity, Equity, and Inclusion (DEI) initiatives, major U.S. companies have begun scaling back or overhauling their DEI programs. This shift marks a significant reversal from the corporate momentum seen after the 2020 Black Lives Matter protests when many companies pledged to address systemic inequities in the workplace. Trump’s executive order, signed on his first full day in office, curtailed federal funding for DEI programs and repealed measures introduced by the Biden administration to combat racial and gender-based discrimination.

Companies such as Google and Meta have been at the forefront of this trend. [Google, for instance, has scrapped its goal to hire more employees from underrepresented groups and is reviewing other DEI initiatives. Similarly, Meta has ended its diverse-slate hiring approach and disbanded its internal DEI team, citing the “shifting legal and policy landscape”.

Retail giants like Walmart and Target have also scaled back their DEI efforts. Walmart has stopped using terms like “LatinX” in corporate communications and ceased funding its Center for Racial Equity, while Target has faced backlash after ending its Racial Equity Action and Change (REACH) initiatives.

The finance sector has not been immune to this trend. Goldman Sachs recently abandoned its policy of requiring at least one diverse board member for companies it advises on public offerings, a rule introduced in 2020 to promote gender and racial diversity.

The rollback of DEI policies has been fueled by a combination of political pressure and legal challenges. The U.S. Supreme Court’s 2023 decision to ban affirmative action in university admissions set the stage for conservative groups to target corporate DEI programs. Republican state attorneys general have warned companies against using race-based hiring practices, while activist investors and social media campaigns have amplified calls to dismantle “woke” corporate policies.

Meir Shemla, an associate professor of organizational behavior at Rotterdam School of Management, noted that Trump’s opposition to DEI has “amplified an undercurrent of scepticism that has been building for years”. This skepticism has led companies to reframe their DEI initiatives, often tying them more closely to business outcomes rather than social justice goals.

While the DEI rollback has been most pronounced in the U.S., its ripple effects are being felt globally. Companies with international operations, such as Deloitte and Accenture, have adopted differing approaches in their U.S. and UK branches. Deloitte, for example, has ended its DEI program in the U.S. but reaffirmed its commitment to diversity in the UK.

Critics warn that scaling back DEI initiatives could harm corporate reputations and make it harder to attract younger talent, particularly Gen Z, who prioritize working for socially responsible employers. Trade unions and advocacy groups have also expressed concerns, with the GMB union warning that multinational companies may export “a rightwing, regressive, anti-worker approach” to their UK operations.

As the debate over DEI continues, the corporate world finds itself at a crossroads, balancing political pressures with the need to foster inclusive workplaces. The coming months will reveal whether this trend represents a temporary shift or a lasting transformation in how companies approach diversity and inclusion.