Momentum shift: DEI metrics' role in executive compensation wanes

By Dawn Kawamoto
Video
July 02, 2024 at 07:00 PM
Share

Much of corporate America responded swiftly in May 2020 when George Floyd was killed by a Minneapolis police officer, sparking widespread national outrage and a reexamination of racism in American life. In addition to speaking out about the murder, many employers launched broad strategies to increase workforce diversity through efforts to hire, promote and better train diverse employees.

Many Fortune 500 companies—including Best Buy, Starbucks, Chipotle, Target, Johnson & Johnson and others—also boosted their focus on accountability among senior leaders by linking executive pay to DEI metrics, such as the retention rate of diverse employees and the inclusivity rate of training offered.

However, new research shows that some organizations have backed off those efforts in the year since the U.S. Supreme Court struck down affirmative action policies at colleges and universities. The ruling prompted conservative activists to file dozens of lawsuits and EEOC complaints against employers objecting to their affirmative action policies for hiring, training and promoting employees.

NOT FOR REPRINT

© Arc, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected].