Costco Stands Firm on Diversity Initiatives Amid Growing Anti-DEI Sentiment
As many corporations are reconsidering their diversity, equity, and inclusion (DEI) policies, Costco is taking a bold stance in defense of its initiatives. This comes at a time when DEI critics are gaining momentum, particularly with a new administration that has expressed opposition to such measures.
In a recent proxy statement, Costco’s board stated, “Our commitment to an enterprise rooted in respect and inclusion is appropriate and necessary.” This declaration was in response to a proposal from the conservative National Center for Public Policy Research, which suggested the company should create a report on its DEI efforts.
In contrast to Costco, several other major companies have opted to scale back their DEI initiatives over the past year and a half. This trend is partly driven by lawsuits and shareholder proposals, with some firms citing DEI policies as potential risks in financial reports.
Despite this, data indicates that shareholders generally favor diversity efforts. A study by the Conference Board found that while shareholder proposals targeting diversity and equity increased more than threefold in the first half of 2024, support for anti-ESG proposals dropped from 5% to 2% compared to the previous year.
Interestingly, out of the approximately 3,000 publicly traded companies in the U.S., only a small fraction—less than 1%—received shareholder proposals on DEI topics. Among these, anti-DEI proposals garnered less than 2% support, whereas social issue proposals not backed by anti-ESG groups received about 20% support.
Costco’s approach challenges the perceived rise of anti-DEI proposals, questioning the need for such investigations in the first place. The company remarked, “We believe that the proponent’s request for a study reflects a policy bias with which we disagree and that further study and reporting would not be an efficient use of Company resources.”
Michael Hiltzik of the LA Times, known for scrutinizing corporate positions on social and political issues, praised Costco’s “straightforward response,” suggesting that stakeholders might hope other companies follow Costco’s lead.
Costco’s shareholders will vote on this matter at their annual meeting on January 23, coinciding with Donald Trump’s return to the presidency. Trump’s campaign has been vocal against DEI policies, claiming they discriminate against white Americans and aiming to dismantle such practices in government and academia.
