Countering the Corporate Diversity Backlash

As opponents of inclusive business practices grow more vocal, leaders are backing down from diversity promises or going quiet. Here’s what they should do instead.

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Corporate diversity is facing a backlash. Target, a company that has carried merchandise celebrating LGBTQ+ pride for over a decade, ordered some stores to remove such products after conservative activists accused the company of sexualizing children and organized a boycott. Anheuser-Busch lost sales in response to a promotion with trans influencer Dylan Mulvaney, costing Bud Light its spot as America’s bestselling beer. Even Chick-fil-A, perhaps the prototype of corporate conservatism with its opposition to same-sex marriage and policy of closing on Sundays, recently came under attack from conservatives for employing an executive to lead its diversity, equity, and inclusion (DEI) efforts.

Universities are also facing a diversity backlash. The U.S. Supreme Court recently struck down race-conscious admissions programs at Harvard and the University of North Carolina at Chapel Hill. Ending race-conscious admissions will likely have ripple effects, as an unclear regulatory environment might discourage organizations from implementing current diversity efforts while spurring some to explicitly exclude Black, Latine, and Indigenous groups.

These recent events show that resistance to civil rights progress for members of marginalized or underrepresented groups remains entrenched, and opponents of efforts to improve equity have been emboldened.

Diversity backlash puts companies in a difficult position. Bowing to pressure from anti-diversity groups may cost them the goodwill they have tried to cultivate among other consumers; Target’s capitulation to conservative pressure earned it blowback from progressive activists. Backing down can also encourage conservative activists to push their demands further. While it might temporarily reduce the pressure on companies, giving in to anti-diversity forces could hurt them over the long term. Demographics are changing, with nonWhites making up an increasing portion of the coveted youth market, and legal protections for LGBTQ+ Americans have broad support. Rooting out discrimination and increasing access to opportunity is essential to ensuring a rich talent pipeline. And for many individual managers and employees, anti-discrimination is simply a moral imperative.

Diversity initiatives are vulnerable to attack because many have been tentative. One-off hours-long training sessions, unsupported new hires, or programs that wither as anti-racist protests recede fall far short of the transformative structural changes needed to make organizational outcomes truly equitable. Leaders who are sincerely committed to diversity must prepare for the cost of defending inclusive organizations and adopt policies that make it difficult to roll back diversity gains.

A Tepid Embrace of Diversity

When President Lyndon Johnson signed the 1964 Civil Rights Act, with Martin Luther King Jr. present, he was responding to decades of agitation for full economic inclusion. Under the act’s Title VII, the commonplace racial discrimination foundational to American workplaces became illegal. Most organizations that adopted diversity policies did so because social movements forced their hand, not out of a high-minded commitment to equal opportunity.

Many organizations retroactively recognized that greater diversity helped them exploit niche markets or foster innovation. But arguments that diversity can be good for the bottom line haven’t led to a fundamental transformation of segregated and racially stratified American workplaces. And relying on a business case for diversity lets leaders withdraw support for these initiatives if economic gains don’t materialize.

While civil rights laws drove real workplace changes, they were largely marginal. Despite early gains in Black and Latine employment, workplace desegregation essentially stopped in the 1980s, and hiring discrimination against Black men has been relatively constant since. When hired, people of color were often designated to diversity positions cordoned off from the organization’s core functions, limiting opportunities for their career growth and mobility. Enforcement of anti-discrimination laws varied greatly depending on the political winds, typically (but not exclusively) increasing under Democratic presidents and waning under Republicans. As sociologists Frank Dobbin and Alexandra Kalev have found in their research, attempts to comply with an uncertain regulatory environment led companies to adopt diversity policies with dubious effectiveness. Human resources experts often introduced policies that courts countenanced as good-faith anti-discrimination efforts, despite the policies being ineffective and sometimes counterproductive.

Diversifying organizations rarely undermined the White norms and the power that shaped them. Homogeneity remained the standard, diversity a deviation. Acknowledging the changes brought to workplaces by the Civil Rights Movement, Kimberlé Crenshaw and colleagues nonetheless highlighted in their 1996 book Critical Race Theory the unequal ground on which diversity policies were seeded: “The very same Whites who administered explicit policies of segregation and racial domination kept their jobs as decision makers in employment offices of companies, admissions offices of schools, lending offices of banks, and so on.”

This history of organizations’ tepid embrace of diversity has left them unprepared to deal with the current backlash. Three short years after their collective response to massive protests over the police murder of George Floyd, companies are reneging on their diversity pledges. Promises included increasing the representation of marginalized groups and women in senior-level positions and boards; addressing retention, promotion, and pay gaps; and working with senior leaders and managers on upskilling inclusive leadership behaviors. Companies added positions focused on DEI to demonstrate their intentions to tackle injustice, without transforming in ways that would support long-term organizational changes.

This history of organizations’ tepid embrace of diversity has left them unprepared to deal with the current backlash.

A slowing economy and, we suspect, a diversity backlash led companies to cut those new DEI positions at a faster rate than other jobs. Attacks on DEI have led some organizations to backtrack from their commitments to create initiatives centered on addressing organizational policies, practices, and cultures that target groups facing persistent inequities. Attempts to integrate substantive DEI programs also succumbed to the backlash, as evidenced by Coca-Cola abandoning its proposed DEI policy for outside law firms. Some activist shareholders have attacked companies’ DEI interventions and also targeted the practice of DEI audits, which help mitigate workplace discrimination.

Confront the Resistance

Although we’ve outlined a pessimistic story, diversity programs can succeed. Research shows that diversity programs are effective when organizations dedicate specialized positions to manage and monitor equity goals and programs.

Accountability is key to sustaining effective DEI policies and programs. While equity work should involve all employees, DEI professionals must be empowered to hold the leadership accountable. Organization leaders must take responsibility for designing, modeling, and implementing equity programs that reshape organizational policy. Research shows that strategic DEI initiatives, including establishing mentoring programs that incentivize employees to sponsor marginalized group members, demonstrating transparency in hiring and promotion processes, and holding employees accountable for diversity goals, can work.

The latest backlash against diversity should prepare organizational leaders for possible resistance to diversity initiatives from internal stakeholders and external anti-diversity activists. Making public statements in support of DEI can help establish accountability goals, but unfortunately, it seems that a growing number of leaders are choosing silence or capitulation in response to anti-diversity activists.

We see a similar phenomenon in how the right-wing rejection of climate science has led some leaders to downplay sustainability goals, a practice known as greenhushing. A recent study examining this dynamic in the hospitality industry found that consumers preferred when hotels communicated their corporate social responsibility efforts rather than engaging in greenhushing. Interestingly, the study found that such communications also prompted consumers to consider the ethics of their own choices. Similarly, we believe that openly discussing an organization’s commitment to address systemic issues through accountability reduces resistance to initiatives that can change behaviors and attitudes and lead to progress.

Organizations should confront the diversity backlash, along with the empty nature of superficial diversity policies, head-on. With diversity training increasingly criticized and White fatigue derailing serious discussions of racism, racial inclusion in organizations faces an existential threat. Resisting this diversity retreat requires organizational accountability to the broad array of commitments made in response to acknowledged racial injustices.

For organizations committed to embedding equity within their mission, values, culture, and practices, we recommend taking a strategic planning approach. Expectations for overnight results must be regulated by realistic goals that are results-oriented and measurable, with targeted dates for completion. This process must include a feedback loop design that allows for corrections in planning, implementing, and executing, thus providing managers with openings to check for impact and progress. Recent events give organizations an opportunity to reaffirm and strengthen their commitments to working toward creating an equitable organization by stamping out inequality.



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