Investors in Major U.S. Companies Show Support for Diversity Policies

Despite widely publicized efforts by the Trump administration and certain Republican-led state governments to roll back diversity, equity and inclusion (DEI) policies and programs at government agencies, universities, and corporations, there are clear signs that publicly-traded companies in the U.S. are pushing back against these efforts. While some companies have made changes to their diversity programs and in many cases are dropping the use of the acronym DEI, the boards and shareholders of many companies are rejecting anti-DEI proposals brought by conservative activists at annual shareholder meetings.

In our Top Stories, we highlight several examples of anti-DEI proposals that were overwhelmingly rejected by shareholders. ESG Today reported that more than 99% of the shareholders of Walmart and Netflix voted to reject resolutions brought at each company’s annual meeting. The article by Mark Segal states that “The votes mark the latest in a series of anti-DEI proposal rejections at major U.S. companies, following similar results at Apple, Amazon, Deere, and Goldman Sachs, among several others.”

Importantly, the shareholders of Walmart and Netflix followed the recommendations of the boards of both companies. Walmart’s board stressed the business rationale behind their diversity programs, saying, “One of our core values is respect for the individual. We work to create a culture where our customers feel welcome and our associates feel like they belong and their contributions are valued. We want our customers to be excited to shop with us and our associates to see us as the best place to work and to build a career. We believe fostering this type of culture among our associates, customers, suppliers, and communities creates value for our business.”

Manufacturing Digital reported on the recent rejection of an anti-DEI proposal by Caterpillar, with 97% of shareholders voting against the resolution to “consider abolishing its DEI policies, department and stated goals.” Caterpillar responded to the proposal by saying it “inappropriately attempts to restrict Caterpillar’s ability to manage its own employees, ordinary business operations and enterprise strategy. We are committed to fostering an inclusive environment and a workforce that is representative of the diverse customers and communities we serve around the globe." According to the article, Caterpillar’s public DEI page remains live on its website.

Biospace reported that 99% of the shareholders of Merck voted to reject an anti-DEI proposal brought by a group that also proposed a similar resolution that was rejected by the shareholders of Johnson & Johnson. According to the article, Merck’s CEO Rob Davis stated at the annual meeting that “Our company has a long-standing commitment to diversity and inclusion. It is at the core of who we are, our values, and how we operate as a company.” He also called it a strategic imperative, saying it “enables us to fully execute on the scientific method and catalyze contributions and innovations from across our enterprise.”

These shareholder votes and the pushback from corporate boards show that most directors and investors are not in favor of eliminating diversity initiatives, even with external pressure. At the same time, many companies have made adjustments to their diversity and inclusion programs, including eliminating specific goals and targets and changing how they describe and communicate about the programs.

The G&A team is monitoring the impact of anti-DEI efforts and helping companies continue to focus on maintaining strategic diversity and inclusion programs grounded in building long-term value. We are available to work with you to develop and implement strategies to adapt to the evolving and challenging landscape. For more information contact us at: info@ga-institute.com.

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