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How Will The SCOTUS Affirmative Action Decision Affect Corporate DEI Initiatives?
The U.S. Supreme Court yesterday in a six to three decision struck down decades of legal precedent in ruling that colleges and universities may no longer use race as a consideration for student admissions.
The decision, which specifically applies to academic institutions, is expected to reverberate beyond academia and into the corporate world’s diversity, equity and inclusion (DEI) initiatives. Businesses are covered under separate legislation by the U.S. Equal Employment Opportunity Commission (EEOC), which enforces federal labor laws making it illegal to discriminate based on a person’s race, color, religion, sex, national origin, age, disability or genetic information.
A Bloomberg article last week predicting the outcome of the cases before the nation’s highest court said that striking down affirmative action would wield a “concussive, though not fatal, blow” to corporate DEI programs.
The Washington Post reports that complaints have been lodged against Hershey, McDonald’s, Nordstrom and others by a conservative group led by a former advisor to Donald Trump claiming that corporate diversity initiatives are discriminatory.
Will Hild, executive director of the right-wing Consumers’ Research, told the Post that ending affirmative action will lead to “a free-for-all on pushing back against” corporate DEI initiatives.
A USA Today article posits that concerns about being targeted by right-wing groups are leading companies to review their own practices to determine if changes need to be made internally. Some, for example, are considering doing away with public targets around diversity to try to avoid becoming a target for groups with a political agenda.
Others are questioning whether they should remove diversity titles in the corporate suite even as their goals and programs remain unchanged. Even right-wing corporate darlings like Chick-fil-A have come under attack for diversity efforts, Axios reports. Calls were made to boycott the chain when a political activist discovered that Chick-fil-A had “just hired” a VP of diversity, equity and inclusion. The job and person in question were in place since 2021 with no uproar prior.
Many companies intend to stick with their DEI initiatives.
“We don’t waver,” Lori Castillo Martinez, chief equality officer at Salesforce, told USA Today. “Equality is our value and that is something we will continue to focus on, especially in these challenging times.”
Discussion Questions
DISCUSSION QUESTIONS: How do you think the Supreme Court’s affirmative action ruling will influence how retailers and consumer brand companies approach their own diversity, equity and inclusion programs? Will the SCOTUS decision and anti-diversity campaigns have a chilling effect on bringing more minorities into the retail workforce from the frontline to the c-suite?
Poll
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This ruling presents an opportunity for retailers to demonstrate their commitment to the communities and people they work with every day.
If you’re committed to fairness, diversity and the federal laws as enforced by the EEOC, then hopefully you’re already hiring the best people for the job fairly and honestly and without consideration for a person’s race, color, religion, sex, national origin, age, disability or genetic information. I suspect that in those cases neither the SCOTUS decision nor anti-diversity campaigns will deter you from your unfettered commitment to equality.
This is precisely correct, @John Lietsch. Very well articulated.
I certainly don’t want to give my money to someone who doesn’t want me. There are plenty of designers who do. Designers? Seriously???
Anyway, my feeling is, their loss.
I think the SCOTUS decision will have an effect on the DEI initiatives to a degree, because it legitimizes a long-held practice of exclusion. The SCOTUS seems to be moving in a direction that is not representative of most Americans. Retailers need to open their doors to a diverse population that reflects the times we are living in. DEI and affirmative action have the same goal: fairness. But affirmative action spent 40-plus years trying to right the wrongs on the past. For companies, especially those like retailers who serve millions of customers daily, this is a put-up or shut-up moment. What do you believe in, really? Not “What do we think our most vocal customers want us to say we believe in?”
Until now, the term “DEI” isn’t as widely recognized as one might think. Starting yesterday, it will become of the most polarizing acronyms out there. Without affirmative action, the pressure is on companies even more to pick a side. Come on, retailers, just hire and promote based on talent, hard work, and potential. Everybody wins.
Decisions in these situations, be them in academia or corporate America, must be made in context with many factors. This issue is not an easy one certainly not clearly defined. We are better when we learn from others, fellow students and co-workers, from different cultures and economic backgrounds. Colleges and Universities, and corporate organizations need to push back as much as possible in order for our society to have some balance.
Zel, that is very well said. “We are better when we learn from others, fellow students and co-workers, from different cultures and economic backgrounds.” I understand the SCOTUS decision. The problem with this is that it considers it unfair to give minorities better access than majorities. However, it takes a big chunk of “education and experience” away from those of us who are not minorities.
I tell my students that more than half of their college education will happen outside the classroom. Half a century ago, I attended top,top universities for my BA and MBA. There were no African Americans in either class. That was my loss, as well as theirs.
A number of organizations have already announced they are going after companies with diversity programs based on the recent SCOTUS decision on Affirmative Action. McDonald’s, Hershey, and Alaska Airlines are targets, as are Anheuser-Busch and Nordstrom. Each was filed by a conservative legal group, alleging that company diversity initiatives are discriminatory and illegal.
The sad part of these initiatives is that study after study has shown that the more diverse a company (from top to bottom), the better the performance of the company.
There will be an effect in some spaces for companies that use colleges attended as a funnel for finding the best people. Based on the SCOTUS decision, companies wishing for a diverse workforce must look harder.
What I’m seeing is that there is a strong and successful push from influential groups to do away with all efforts of inclusion. If you’re told to remove your Pride insignia (in sports_ and to stand back from trying to structure a more diverse student body, you’re being dictated to discount the still existing challenges for diversity…as in “so what about ‘them’”. Do you think there will be a law suit brought against HBCU’s? So do I think there will be a chilling effect on promoting more minorities into middle and upper management in the retail workforce? i think it will have a chilling effect across all organizations, for profit and non-profit.
Will companies now be challenged in court when they promote minorities for choosing one individual over another because of efforts of diversity rather than the real reason…performance?
Gene,
Of course they will. That’s the whole point of this “legal” charade.
While the SCOTUS decision will give ammunition to those wanting to target diversity, equity and inclusion programs, it does not necessarily give them a sound basis for legal action. Legally, there is a big difference between affirmative action in university student hiring and corporate programs which seek to promote diversity. The former takes race into account in student recruitment decisions, whereas the latter does not for hiring employees. Indeed, corporations have never been legally sanctioned to look at or consider race in hiring decisions, bar in a very limited and specific set of instances. The real threat comes from two further potential cases that may come before SCOTUS which will address whether practices outside of hiring decisions must be blind to race – rulings on these may necessitate a wider and more comprehensive review of DEI initiatives.
I think it’s a mistake to discuss the affirmative action ruling in a vacuum. It is part of a pattern of “exclusionary” decisions that strip away legal rights from previously protected classes. First Roe v. Wade was overturned which potentially put retailers’ healthcare policies at odds with the states they operate in. Yesterday, we saw a “gut punch” expertly delivered to the soft underbelly of affirmative action. And today, the LGBTQ+ community took another body blow when SCOTUS ruled in favor of Lorie Smith. Can gay marriage be far behind? And, if gay marriage is indeed in the conservative Court’s crosshairs – which it would appear to be – what happens to benefits for same sex employee partners, etc., etc.? Phase II? I’d look for “activist investors” with an eye toward targeting publicly held “liberal” firms. As to whether or not the ruling will have, ” … a chilling effect on bringing more minorities into the retail workforce from the frontline to the c-suite,” the right answer is “Yes” because it will provide a legal justification for firms that weren’t comfortable with DEI rules in the first place. Welcome to the 19th Century folks!
I’m hopeful that the Supreme Court respects private companies’ right to practice HR initiatives (including DEI) as long as they are aligned with existing fair hiring laws.
Retail is one of the most effective tools that consumers can access to create the society they want — more powerful than even voting in elections. Consumers can get whatever they are willing to pay for, be it environmentally friendly products, animal cruelty free products, products that aren’t made with child labor or abused workers, equal opportunity for employees and customers, or access for the disabled. I find that our laws most often follow what retailers implement at the behest of their customers — not the other way around.
I don’t see it as having much impact, for the simple reason that a lot of diversity initiatives were “big hat, no cattle” anyway.(An couple of full-page ads a year in the NYT does not “commitment” make.)
I guess a company could get in trouble if it made a point of saying “we want our workforce to be X% of ___ persons” but I doubt many companies ever did that: more subtle language – X% “local residents” – would be used (which is logically the goal anyway). We may see more suits from failed C-suite candidates who claim they were discriminated against, but what else is new ?
Chilling? No. Impact? Yes, absolutely. Retailers will either need to figure out a workaround or find some other way to support diversity in their environments.