Corporate backing of diversity, equity and inclusion has become table stakes in the last few years. While employer attention to DEI was already growing, the 2020 murder of George Floyd and subsequent global reckoning on race dramatically accelerated DEI to the top of the corporate priority list, solidified by evolving expectations about DEI, particularly among younger entrants to the workforce. But now, is a building “anti-woke” movement threatening the future of corporate DEI?
Not exactly, experts predict. However, political and legal pushback—along with other factors, including the workforce disruptions of artificial intelligence—are changing the game for corporate DEI.
“I do suspect that in the current discourse, some organizations are going to lay low—not put themselves in the spotlight externally [for their DEI work],” says Tory Clarke, partner and co-founder of executive search firm Bridge Partners. Clarke cautions that she’s “not sure this is the best approach; it’s what a lot are doing.” Though, she adds, “this doesn’t mean there can’t be a lot of really good work done internally in terms of building equitable cultures and inclusive hiring.”
‘Perception and positioning’ of DEI initiatives
Critics of DEI efforts have claimed a number of recent victories—from last year’s Supreme Court decision overturning affirmative action in higher education to the recent high-profile resignation of Harvard University’s Claudine Gay, a target of anti-DEI activists. Meanwhile, earlier this month, the Florida State Board of Education voted to restrict federal funding for DEI initiatives at the state’s more than two dozen public colleges.
The SCOTUS ruling, in particular, may embolden a wave of legal actions seeking to restrict corporate DEI work, experts predicted in the wake of the precedent-setting decision.
However, seven months after the ruling, a new study found that that possibility isn’t causing employers to dial back their DEI investments. In a survey of more than 300 C-suite leaders, law firm Littler found that just 1% of respondents said their organizations decreased their DEI activity in the last year—and 60% increased it.
More than 90% said the ruling hasn’t impacted their DEI agenda, although nearly 60% of leaders surveyed did acknowledge increased public pressure against corporate DEI work.
Those statistics are on par with a study conducted shortly after the Supreme Court ruling by Bridge Partners that found more than 75% of employers with DEI programs increased their investment in the previous year and about the same expected to continue enhancing their DEI initiatives into 2024. Nearly 44% said the decision will prompt their organizations to increase their DEI investment.
“‘It’s not going to deter us; we believe in the underlying benefits here,'” was the consensus of respondents, says Ryan Whitacre, partner and executive recruiter at Bridge Partners.
Yet, media headlines speculating about the “death of DEI” in the wake of the ruling and other pushback abound. Whitacre likens them to the unfulfilled economic forecasts in the last year: “There were polls, especially of CFOs, where they said, ‘Yes, there’s going to be a recession that will happen in 2023,’ but then when they were asked about their own organization, they said, ‘Yeah, but we’re good.’ That seems to me a lot of what’s happening around the DEI discourse.”
While the overturning of college affirmative action may not be causing businesses to pull back on their DEI activity, it is creating a new emphasis on the “specificity” of DEI agendas, says Amira Barger, executive vice president and head of DEI Communications & Advisory, Health Communications at consultancy Edelman.
“The challenge for HR and DEI executives and leadership in general is now about perception and positioning,” Barger says. “We have to be really specific about saying what we mean and meaning what we say.”
The importance of data in DEI efforts
For instance, the “anti-DEI” movement, she adds, is largely focused on race and ethnicity, and employers can counter that pushback by focusing keenly on inclusion and incorporating the many dimensions of diversity into their DEI agendas.
Leveraging data to prove the value of ongoing investment in DEI, Barger says, is also going to be increasingly important for sustaining leadership attention to DEI, particularly amid potential public pushback.
HR and DEI executives need hard numbers about the DEI agenda’s impact on the organization’s ability to innovate, customer satisfaction, Net Promoter Scores and, importantly, the bottom line.
“If [leadership is] going to invest dollars, bodies, time and energy into the work of DEI, they’re going to have questions,'” Barger says, noting that communication skills are going to be exceptionally important for HR and DEI leaders of tomorrow, as they focus on being the “influencers” among the C-suite on DEI investment.
“I’m not a big fan of making a ‘business case’ for DEI because there are myriad intersecting cases—the moral case, the justice case,” Barger says, “but in corporate spaces, the language of the people is revenue and the bottom line. And that needs to be part of the story HR and DEI executives tell right now.”
Doing away with the ‘DEI police’?
In the last few years, much of the work to influence the corporate DEI agenda has been led by an organization’s chief DEI officer. This position skyrocketed following Floyd’s 2020 murder.
LinkedIn research found that between 2020-21, employers hired chief DEI officers more than any other C-suite role, while the number of S&P 500 companies employing a C-level DEI executive grew from 47% to about 75% from 2018-22.
However, things started to change in 2023, when hiring for DEI titles slowed by 48% year over year, according to industry analyst Josh Bersin.
“All our research shows that corporate DEI investments are not going away or even declining, but the size of the DEI team in HR is shrinking,” Bersin tells HRE.
Given the explosion of hiring for DEI roles starting in 2020, the slowdown makes sense.
However, in some cases, Clarke says, employers are using the pushback against corporate DEI to “gently renege” on some of the promises they made when they created a C-suite DEI position in 2020 or 2021 and are now opting not to rehire after the departure of a chief DEI officer.
“They acquired leaders with big promises,” she says, “but didn’t necessarily have the budget, the resources, the impetus, the drive to fulfill those promises.”
Meanwhile, organizations that were more strategic about creating DEI roles in the last few years likely made good hires whom they have retained, further driving down the number of job openings for this role, Clarke notes.
It’s also important to recognize, Whitacre says, that corporate DEI work—and those who lead it—have continuously evolved. The chief DEI officer position largely didn’t exist just 10 years ago, he notes.
“This is fairly new, and we’re now getting more formalization through trial and error, experience and expertise,” he says. “As the role continues to evolve, I don’t think it’s going to go away. There are going to be really good people doing good work and who will be able to repeat those lessons they’ve learned about effectively [reaching] goals of inclusion and diversity without running afoul of the law or being a target for backlash.”
That may mean we’ll continue to see “downsizing” of DEI teams and rebranding of their focus, he adds.
In particular, predicts Bersin, the concept of having “DEI police within HR” is fading.
“I believe the days of a chief diversity officer taking on a role as an educator about oppression, inequality or other social issues are over,” he says. “These kinds of educational programs did not fare well, and many of them backfired—creating more animosity and confusion. The focus now is on pragmatic DEI.”
Emphasizing inclusion over diversity
What does pragmatic DEI look like?
As opposed to education and awareness-building led by chief DEI officers, Bersin says, the focus now will be on building a diverse and inclusive culture, which he says can be supported with a “steady stream” of data-driven messaging, internally and externally, about the valuable impact of diversity for the organization.
“Setting targets and talking about ‘hitting targets’ does not really accomplish this,” Bersin says, “because if the company is not inclusive in its culture, hiring targets simply fail.”
While diversity-related KPIs were a natural first step for many organizations building out a DEI foundation, Whitacre adds, for many, it became a “numbers game, a box-checking exercise.”
“‘Do we have X number of Black people, X number of Asian people?’ And that was effectively the point of the SCOTUS decision: No more race-based thumbs on the scale,” Whitacre says, noting that the ruling will accelerate the corporate DEI evolution toward an emphasis on inclusion over diversity.
“What’s your cultural environment like? What’s the atmosphere when you do bring in someone who brings different qualities?” Whitacre asks. “You need inclusion and equity before you can have diversity. Diversity might be the easy thing for scorecards but it can get you into hot water. So, you have to think about strategies to amplify the ‘E’ and the ‘I.'”
That’s not to say hiring and promotion of diverse candidates should fall off the DEI agenda, Bersin notes. The more women and minorities who move into leadership, for instance, the more readily an inclusive culture can “take hold.”
Skills and DEI
Many companies will remain vigilant about “giving all groups equal access to management and leadership roles” to foster more inclusive cultures ultimately, Bersin says.
Organizations committed to sustaining such cultures, adds Barger, can bring more diverse talent into the fold by prioritizing upskilling and skills-based hiring—particularly given the current context.
On the one hand, she says, the SCOTUS affirmative action decision will impact the representation of minorities in higher education and, ultimately, in the workforce—which will inhibit their ability to accumulate generational wealth in the long run. That will only deepen the racial wealth gap: The average net worth of white households is $285,000, compared to $45,000 for Black households.
Meanwhile, the advancement of artificial intelligence—particularly when it is unchecked, Barger says—will lead to the automation of jobs that are, in many cases, currently held by Black and brown people who lack equal access to education.
“All of these forces are tied and connected,” Barger says. “The regulation of AI is a real concern I have because it’s going to impact the jobs people are able to get now if they don’t have a four-year degree. It’s going to put people in a really precarious position.”
Employers need to consider upskilling through a DEI lens, Barger says, including enhancing scholarship programs, raising caps on tuition reimbursement initiatives and connecting workers to training and development opportunities.
Placing skills-based hiring at the top of the DEI agenda will also be critical, she says.
“Someone may not have a four-year degree but may have 10 years of actual experience in the field,” Barger says. “We have to stop checking the box of a four-year degree and revise our recruitment and interviewing processes to dig deeper into people’s experiences.”