COSTCO’s deadline to axe its diversity, equity and inclusion programs looms as pressure mounts from Republican attorneys general.
Opinions are split over U.S. President Donald Trump’s DEI crackdown.
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Trump pledged in his inaugural presidential address to “forge a society that is colour-blind and merit-based.”
On January 21, he signed an executive order aimed at terminating DEI programs within federal agencies, which he and conservatives have long condemned as discriminatory.
He also directed “all departments and agencies to take strong action to end private sector DEI discrimination, including civil compliance investigations.”
“Hardworking Americans who deserve a shot at the American Dream should not be stigmatized, demeaned, or shut out of opportunities because of their race or sex,” the executive order stated.
The orders have resulted in multiple prominent firms – including Walmart – scaling back or pushing aside their diversity, equity and inclusion initiatives.
But Costco has been fighting against the move – which represents a huge cultural shift across the US.
The wholesale club’s shareholders rejected a proposal to evaluate any “risks” posed by its DEI practices, despite Trump’s order.
Its directors also praised diverse employees and suppliers for fostering “creativity and innovation in merchandise and services.”
But that snub riled a group of Republican attorneys general.
Nineteen of them ordered Costco to chop its DEI policies, citing concerns about discrimination and legal risks.
State officials sent a terse letter to Costco’s top boss Ron Vachris, accusing his firm of doubling down on policies they alleged violated merit-based principles and federal law.
They also demanded Costco notify the states within 30 days whether it will repeal its DEI policies or provide an explanation for maintaining them.
The group wrote on January 27, “Inexplicably, Costco has doubled down on DEI.
“Last month, Costco’s board of directors unanimously recommended that shareholders vote against a proposal requiring Costco to study and report on financial risks associated with its DEI policies.
“Costco’s position runs contrary to the Supreme Court’s recent decisions and raises concerns about Costco’s compliance with State and federal laws.
“For the good of its employees, investors, and customers, Costco should ‘do the right thing’ by following the law and repealing its DEI policies.
“Within 30 days, please either notify us that Costco has repealed its DEI policies or explain why Costco has failed to do so. We look
forward to your response.”
Which firms have dumped DEI policies after Donald Trump’s executive order?
Big consumer brands have ditched DEI programs including:
- Walmart
- McDonald’s
- John Deere
- Target
- Meta Platforms
- Ford
- Brown-Forman – the parent company of Jack Daniels
- Tractor Supply
- PBS
Goldman Sachs has retreated from DEI, by dropping a requirement that forced some clients to include women and members of minority groups on their board of directors.
Google has rescinded a goal in 2020 to increase representation of underrepresented groups among the company’s leadership team by 30% within five years.
Amazon said it was halting some of its DEI programs, although it did not specify which ones.
Lowe’s said the company was “reviewing” its DEI programs.
Harley-Davidson said it does not have hiring quotas and would no longer have supplier diversity spending goals
The pressure comes as firms including Ford, McDonald’s, PBS, and Target have already banished their DEI programs.
Viewers of ABC-affiliated Wate News told the broadcaster that they were “confused” about DEI changes.
One person asked on social media, “What happened to freedom?”
Another wrote, “I’m confused, it can be demanded that companies end their DEI policies?”
One woman also wanted to check, “They get to keep their employees though, right?
“It just ends the requirements to have a certain percentage of people that fit the DEI guidelines? Like the company doesn’t have to fire people, does it?”
She was told: “You’ve been misled. That simply isn’t true.”
And there was plenty of support for Costco, with one person posting, “I stand behind Costco” and another writing, “Just opened a Costco membership! Keep up the good work!”
The U.S. Sun has contacted Costco for comment.
The Isaacs Law Firm in Knoxville, Tennessee, told Wade News, that within 120 days of the executive order, the Attorney General must issue a report with “recommendations for enforcing the federal civil-rights laws and taking appropriate measures to encourage the private sector to end illegal discrimination and preferences, including DEI.”
