Diversity, Equity, and Inclusion (DEI) initiatives have gradually become a central part of corporate strategies. While these efforts gained significant traction in the past decade, their origins trace back to the mid-20th century, with the introduction of equal employment laws and affirmative action in the United States during the 1960s. These policies laid the foundation for workplace diversity programs.

Initially, DEI efforts were compliance-driven, focusing on mandatory training and policies aimed at preventing discrimination. However, many of these programs fell short, functioning as check-the-box exercises rather than fostering genuine cultural shifts. By the early 2000s, corporate attitudes evolved, and DEI became recognized as a value-adding business strategy. The appointment of Chief Diversity Officers and the rise of DEI consulting services reflected its growing significance.

2020: A Turning Point for DEI

The pivotal moment for DEI came in 2020, following the global reckoning on racial justice spurred by the Black Lives Matter movement. Major corporations—including Google, Nike, and Wells Fargo—publicly committed to diversity, pledging investments in hiring practices, leadership representation, and community initiatives. A 2022 McKinsey & Company report highlighted the business benefits of DEI, linking it to resilience during economic downturns, improved talent retention, and adaptability. However, this momentum proved short-lived.

2024: The Onset of Backlash

By 2024, DEI faced mounting scrutiny, surpassing even sustainability initiatives in corporate controversy. While originally intended to promote fair opportunities, DEI became a politically charged topic. Critics argued that some initiatives fostered preferential treatment rather than genuine inclusivity, prompting companies to scale back their commitments.

One of the most notable shifts occurred in July 2024 when Microsoft disbanded its DEI division, citing "changing business needs." This reversal sparked internal frustration, with employees voicing concerns about shifting priorities. Several major corporations followed suit:

• Ford Motor Co. withdrew from an annual LGBTQ advocacy survey and ended supplier diversity quotas.

• Starbucks, Tractor Supply, and John Deere removed DEI-related performance incentives and stopped submitting diversity data.

• Google and Meta significantly reduced DEI hiring, with job postings dropping 44% from mid-2022 to mid-2023.

• JPMorgan Chase, Harley-Davidson, and Lowe’s shifted away from explicit diversity hiring targets and public commitments.

Amid economic pressures and increasing legal challenges, businesses reevaluated the risks and benefits of maintaining aggressive diversity programs.

2025: Corporate Retrenchment Intensifies

By 2025, the corporate pullback on DEI accelerated. Google officially discontinued its DEI program, with Chief HR Officer Fiona Cicconi citing legal rulings and compliance obligations. Meta and Amazon followed similar paths, quietly reducing diversity-focused roles and commitments.

Legal concerns played a major role in this retreat. Lawsuits alleging "reverse discrimination" created a cautious environment, particularly for government contractors. Consulting firms like Deloitte, which once championed DEI, advised employees to remove pronouns from email signatures and adjusted internal policies to reduce legal exposure.

The Federal Rollback of DEI

On January 20, 2025, President Trump signed an Executive Order titled “Ending Radical and Wasteful Government DEI Programs and Preferencing,” characterizing DEI initiatives as “immense public waste and shameful discrimination.” The order placed all federal DEI staff on paid leave, laying the groundwork for their dismissal. A second Executive Order, “Ending Illegal Discrimination and Restoring Merit-Based Opportunity,” reversed decades of federal policies aimed at increasing diversity and combating systemic discrimination.

These federal rollbacks influenced corporate decisions, emboldening organizations to curtail their DEI efforts. Major companies either scaled back or completely shuttered their DEI programs in response:

• PepsiCo ended workforce representation goals and removed its diversity page.

• Disney discontinued its "Reimagine Tomorrow" initiative and ceased diversity-related performance metrics.

• PBS halted DEI initiatives to comply with federal orders, leading to the departure of key DEI leaders.

• Financial institutions like Goldman Sachs, Morgan Stanley, Citigroup, and JPMorgan Chase scaled back DEI programs.

• Google eliminated diversity hiring goals and removed calendar observances for Black History Month, Women’s History Month, and Holocaust Remembrance Day.

• Meta, Amazon, Boeing, Target, McDonald’s, Walmart, and KPMG US followed similar paths, quietly restructuring or discontinuing DEI programs.

Companies Continuing DEI Efforts

Despite the shifting landscape, some companies remain committed to DEI:

• McKinsey & Company reaffirmed its commitment, stating in a 2025 memo that diversity remains integral to its meritocratic approach.

• Coca-Cola acknowledged political headwinds but continues to highlight diversity as a business risk in regulatory filings.

A Broader Corporate Shift

Rather than eliminating DEI entirely, some companies have opted for quieter modifications:

• Disney rebranded its DEI program from "Reimagine Tomorrow" to "MyDisneyToday," shifting its focus from diversity metrics to talent strategies.

• Goldman Sachs rescinded its policy requiring underrepresented board members for IPO clients.

• Accenture integrated DEI into general talent acquisition instead of standalone initiatives.

Why the Shift Away from DEI?

Several key factors contributed to the widespread retreat from DEI initiatives:

1. Economic Constraints – Cost-cutting measures led to the deprioritization of DEI roles in favor of revenue-generating functions.

2. Legal and Compliance Risks – Heightened scrutiny and lawsuits pressured companies to move away from diversity-driven hiring policies.

3. Political and Social Polarization – DEI became a divisive issue, prompting companies to reduce public-facing commitments.

4. Changing Business Priorities – Many firms integrated diversity efforts into overall HR strategies rather than maintaining separate DEI programs.

The Future of DEI

Despite the setbacks, DEI is unlikely to disappear entirely. A 2024 Morning Consult survey found that 82% of executives still see diversity as critical to business success. However, the approach is shifting. Rather than high-profile diversity pledges, companies are embedding inclusion into broader talent management and leadership development efforts.

Industries with global footprints remain committed to DEI due to regulatory obligations and market expectations. Businesses that genuinely value diversity are focusing on sustainable integration rather than performative initiatives.

The rise and decline of DEI reflect the ongoing tension between corporate responsibility and business pragmatism. While the large-scale retreat from DEI programs marks a shift in strategy, the underlying principles of diversity, equity, and inclusion remain relevant. The challenge moving forward is to reshape DEI into a model that aligns with business goals while maintaining meaningful progress toward workplace inclusivity.