Walmart rolls back DEI programs after right-wing backlash

CNN

By Nathaniel Meyersohn, CNN

New York (CNN) — Walmart, the largest private employer in the United States, will curb some diversity, equity and inclusion (DEI) efforts. It’s the latest company to backtrack on diversity initiatives in the face of right-wing pressure, and its decisions will reverberate across corporate America.

The company said Monday it is ending racial equity training programs for staff and evaluating programs designed to increase supplier diversity. Walmart has worked to increase the number of suppliers that are at least 51% owned or managed by a woman, minority, veteran or someone who is LGBTQ in recent years.

The company is also reviewing all funding of Pride and other events and monitoring its online marketplace to remove sexual or transgender products marketed to children. Walmart also said it will not extend its Center for Racial Equity, a five-year, $100 million philanthropic commitment the company made in 2020 to address the root causes of gaps in outcomes of African Americans in education, health, criminal justice and other areas.

DEI is typically a mix of employee training, resource networks and recruiting practices to encourage representation of people of different races, genders, classes and other backgrounds.

It’s not clear what impact Walmart’s moves will have on its workforce of 1.6 million employees in the United States. More than half of its hourly employees and 42% of management are people of color, according to the company’s latest data. But Walmart’s changes are a sign of a broader retreat of companies spotlighting their diversity programs.

“We are willing to change alongside our associates and customers who represent all of America,” Walmart said in a statement. “We’ve been on a journey and know we aren’t perfect, but every decision comes from a place of wanting to foster a sense of belonging.”

Activist Robby Starbuck, who has led a pressure campaign against businesses for diversity programs, took credit for many of the changes and said he had contacted the company about its policies.

“This is the biggest win yet for our movement,” Starbuck said on social media platform X.

Starbuck, a former Hollywood music video director turned conservative activist, has caught fire campaigning online against major companies’ DEI programs and other progressive initiatives.

Walmart joins Harley-Davidson, Tractor Supply Co., John Deere and other companies in revising or pulling back on their DEI programs, support for Pride marches and LGBTQ events, strategies to slow climate change and other social policies.

Moving away from DEI

Many companies have moved away from DEI in the past two years.

In 2020, DEI initiatives picked up after a wave of protests for racial justice in the wake of the police murder of George Floyd. Companies spent an estimated $7.5 billion that year on DEI-related efforts, such as employee resource groups, according to a McKinsey study.

But some companies have recently retreated in the wake of legal and political pressure.

Last year, Bud Light’s partnership with transgender influencer Dylan Mulvaney sparked an anti-trans backlash and a months-long boycott of the beer brand. The boycott and the company’s subsequent tepid response likely lost parent company Anheuser-Busch InBe as much as $1.4 billion in sales, according to the company.

In 2023, the Supreme Court ruled that colleges and universities can no longer take race into consideration in granting admission, a landmark decision overturning long-standing precedent that benefited Black and Latino students in higher education. Conservative legal groups have filed lawsuits targeting companies’ diversity initiatives since, and many companies began making changes in the aftermath of the ruling.

Donald Trump’s election victory is likely to accelerate many companies’ turn away from formal DEI programs, experts say.

“The DEI infrastructure in most corporations was already flimsy even before Trump,” Shaun Harper, a professor of education and business at the University of Southern California and founder and executive director of its Race and Equity Center, said in an interview with CNN last week. “Trump’s election gives business leaders who were never committed to an easy out.”

Harper expects to see a continued elimination of DEI and chief diversity officer roles within companies, less diversity training for employees and a decline in the number of people of color and women at the leadership ranks of companies.

Companies that move away from their commitments to diversity could put them at odds with their own employees and hurt talent retention strategies, however. DEI initiatives have been shown to reduce employee attrition and increase employee motivation, according to Boston Consulting Group research based on data from more than 27,000 employees in 16 countries.

“Employees are going to insist and demand employers do something,” Harper said. “Those employers are going to be woefully underprepared to respond.”

The-CNN-Wire
™ & © 2024 Cable News Network, Inc., a Warner Bros. Discovery Company. All rights reserved.