Driving DEI: Some Seek to Tap the Brakes, Others Press the Accelerator

Diversity, equity and inclusion (DEI) programs are a popular — and leading — practice of many organizations, and a core focus/driver of many human resources and total rewards professionals. However, DEI success remains elusive for a portion of organizations (and their leaders) and a bone of contention for others.

As a result of this situation, some organizations may choose to cut, retool or rebrand DEI efforts, said Elissa Tucker, the principal research lead in human capital management at the American Productivity & Quality Center (APQC).

“In response to economic uncertainty, a changing legal landscape and anti-DEI activism, some organizations have scaled back or cut DEI programming,” she said. “So far, however, DEI cuts have taken place in [employers’] job markets and the full scale of their impact has yet to be realized.”

DEI, in one shape or form, has certainly been in the news recently, with some organizations taking it in a different direction, some groups underscoring its traditional purpose and value, and other entities offering best practices to strengthen and expand performance in this area.

This article serves to compile some of those storylines.

DEI Scrutinized: The Rise of ‘MEI’ Programs

Backlash by some leaders and activists that oppose DEI has given rise to a new, competing acronym in the corporate community: MEI — or merit, excellence and intelligence — hiring. MEI proponents, including Scale AI CEO/co-founder Alexandr Wang and Tesla/X Corp./SpaceX executive Elon Musk, say hiring by past track record and ability to do the job should supersede the stated goals and actions of DEI programs.

“There is a mistaken belief that meritocracy somehow conflicts with diversity. I strongly disagree,” Wang stated in a post on social platform X. “No group has a monopoly on excellence. A hiring process based on merit will naturally yield a variety of backgrounds, perspectives and ideas. Achieving this requires casting a wide net for talent and then objectively selecting the best, without bias in any direction. We will not pick winners and losers based on someone being the ‘right’ or ‘wrong’ race, gender and so on. … Doing so would be racist and sexist, not to mention illegal.”

In a one-word post on X, Musk referred to MEI as “Great!”

Tucker, though, has a different take. She countered that given the benefits of diverse and inclusive workplaces, employers that cut back on DEI — and what it has accomplished to this point — may be making a serious mistake that could backfire in the long run.

Tucked added that although the future of DEI at some organizations may be unknown, the impact of DEI for employee engagement and other deliverables is expected to continue interest in and support for such initiatives in their more traditional forms.

CBC Report Says DEI Works and Should Be Expanded

On Sept. 9, the Congressional Black Caucus (CBC) published “What Good Looks Like: A Corporate Accountability Report on Diversity, Equity and Inclusion,” highlighting DEI best practices from its 2024 survey of 189 U.S. companies across various industries. In developing the report, CBC members met with Fortune 500 CEOs, received documentation from DEI reports and tabulated responses to a series of 20 questions referencing 12 areas of corporate DEI performance.

According to the report, most survey respondents remain committed to advancing workplace DEI despite dissent from detractors in the wake of the U.S. Supreme Court’s June 2023 decision to overturn affirmative action in the case Students for Fair Admissions v. Harvard.

A CBC press release introducing its report stated, “Since the ruling, diversity initiatives have come under attack in corporate America, on college campuses in nearly 30 states, and in federal programs and venture capital firms for Black and minority businesses, despite research [supporting DEI and its impact] from institutions such as the Black Economic Alliance Foundation … and McKinsey & Company.”

The alliance foundation research found that 78% of Americans agreed that “corporate America should reflect the racial diversity of the American population.” The McKinsey research found that companies with racially diverse executive teams are 39% more profitable than their peers.

According to the CBC report, companies with a high-performance track record in DEI implemented:

Strategies such as data collection and analysis to discover and mitigate bias;
Targeted development, mentorship and sponsorship programs; and,
Regular reviews of their hiring and promotion practices.

In their report, the CBC wrote, “The survey responses also reveal persistent challenges, such as underrepresentation of certain groups in leadership positions and disparities in retention and advancement rates. Addressing these challenges will require ongoing collaboration and innovation from corporate leaders, policymakers and other stakeholders.”

LGBTQ+ Workers Have Strong Sentiments on DEI Pullbacks

The Human Rights Campaign Foundation (HRC) on Sept. 4 published results of a survey showing how LGBTQ+ adults would react to an employer rolling back DEI. The sentiments were strong: 76% of respondents said they would unfavorably view an organization that cuts DEI, perhaps even making professional and personal spending decisions because of it.

The HRC conducted the online survey in August and received 2,432 responses from people aged 18 or older who identify as LGBTQ+. The results showed 80% of respondents said they would boycott organizations that roll back DEI, while 53% said they would tell others to join them in boycotting such organizations.

If survey respondents worked for an employer that rolled back DEI:

20% said they would quit or start looking for a new job.
72% said they would feel less included/accepted at work.
34% felt their productivity would suffer.

The report posited that organizations should think carefully before backing down on DEI, given that nearly 30% of Gen Z adults identify as part of the LGBTQ+ community and LGBTQ+ Americans hold an estimated $1.4 trillion in total spending power.

How Total Rewards Pros Can Make Strides in DEI

APQC’s Tucker stated that HR and total rewards professionals can utilize their knowledge and access to data and resources to best influence DEI and its impact on their organizations. Data already available internally could help generate a model to illustrate the effect of cutbacks or additional investment.

Based on APQC’s research, Tucker recommended the following leading practices for HR/TR professionals:

Understand. By looking at employees’ experiences, organizations can focus their DEI efforts for the best return on investment (ROI).
Dedicate resources. Budgets, staffing and decision-making authority are all necessary for any successful program — DEI or otherwise.
Involve all stakeholders. Ensure your team is “engaged, accountable and incentivized” toward the program’s mission and vision.
Establish goals and a baseline. Everyone on — or connected to — the team should understand the goals and where the organization stands in relation to these goals.
Adapt processes, policies and procedures. Review existing inequities and bias, and enact mitigation strategies to accomplish change when and where it is applicable and necessary.
Monitor performance. Create accountability for results and track the metrics chosen to represent progress toward the mission and vision.

Tucker stated that with broad-ranging impact on employee engagement, well-being and talent acquisition/retention, organizational investments in DEI strategies can often show quantifiable ROI, demonstrating program value.

Editor’s Note: Additional Content

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