In a significant policy shift, President Donald Trump has initiated a sweeping rollback of Diversity, Equity, and Inclusion (DEI) programs which he regards as “radical and wasteful”. These changes began within the federal government and are subsequently exerting considerable pressure on the private sector. 

 This initiative follows  broader conservative criticism and legal challenges against DEI policies which have intensified in recent years.

 Trump's Policy and Rationale for Change

Upon his return to the White House on January 20, 2025, President Trump issued several executive orders aimed at dismantling DEI. The "Ending Radical and Wasteful Government DEI Programs and preferencing" order mandates the termination of all discriminatory programs, including DEI and DEIA (Diversity, Equity, Inclusion, and Accessibility) mandates, policies, programs, and activities across the federal government. 

This includes eliminating the DEI and Environmental Justice offices and positions, revising employee training, and forbidding the consideration of DEI factors in federal employment practices and performance reviews.

Trump views these programs as an "infiltration" stemming from the previous administration's focus on racial inequities.

A separate executive order, "Defending Women From Gender Ideology Extremism and Restoring Biological Truth to the Federal Government," established a federal policy recognising only two sexes, male and female, and directed agencies to remove policies promoting "gender ideology".

 Furthermore, the "Ending Illegal Discrimination and Restoring Merit-Based Opportunity" order revoked Executive Order 11246, which previously required federal contractors to implement affirmative action programs. This means federal contractors are no longer held responsible for taking affirmative action or promoting "diversity".

Effects on the  Private Sector

Crucially, Trump's policy extends beyond federal entities, actively "encouraging” the private sector to end illegal DEI preferences and discrimination. 

The Attorney General is tasked with identifying "egregious and discriminatory" DEI practitioners in key sectors and formulating a "strategic enforcement plan" that could lead to civil compliance investigations, federal lawsuits, and regulatory actions against publicly traded corporations, large non-profits, and universities.

During his inaugural address and at the World Economic Forum in Davos, Trump explicitly stated his aim to "abolish all discriminatory diversity, equity, and inclusion nonsense" to forge a "colour blind and merit-based country".

Searching for a  Legal Precedent 

The 2023 Supreme Court decision in Students for Fair Admissions v. Harvard, which outlawed race-based affirmative action in university admissions, is frequently cited by the administration and its supporters as a legal precedent for rolling back DEI initiatives in both education and the private sector. 

A federal appeals court ruling in December 2024 also invalidated Nasdaq's requirement for board diversity quotas, further contributing to a "shifting legal and policy landscape".

Companies Adjusting to the New Climate

In response to these executive orders and the broader anti-DEI movement, a wave of prominent corporations have adjusted or scaled back their DEI initiatives. These companies span various sectors, including tech, finance, retail, and manufacturing.

Specific adjustments include:

Renaming and Reframing:

-       Citigroup's DEI team became "Talent Management and Engagement", 

-       Pepsi's Chief DEI Officer role shifted to focus on employee development

-       Disney changed its diversity metric to "Talent Strategy"

-       McDonald's renamed its diversity team to "Global Inclusion Team"

Halting Hiring and Representation Targets:

-       Victoria's Secret is reevaluating supplier diversity and Black worker promotion goals. 

-       Goldman Sachs axed a diversity requirement for companies it takes public. 

-       Paramount will no longer use diversity targets in hiring.

-       Bank of America ended "aspirational" targets for diversity hiring.

-       Citigroup, Pepsi, Google, Accenture, Meta, and McDonald's all ceased or reduced diversity hiring goals.

Cessation of External Engagements and Reporting:

-       Victoria's Secret, Warner Bros. Discovery, Paramount, Walmart, Ford Motor Co, Harley-Davidson, and Toyota have all stopped participating in external diversity surveys or indices like those from the Human Rights Campaign. 

-       Deloitte, PBS, Google, and Amazon also ceased issuing diversity reports or public references to DEI initiatives.

Supplier Diversity and Training Shifts:

-        IBM, Constellation Brands, Pepsi, and Meta shifted supplier diversity goals away from race/gender to focus on all small businesses. 

-       Meta also ended equity and inclusion training.

Other Notable Changes:

-       Deloitte instructed US employees working with government clients to remove pronouns from email signatures. 

-       Google stopped marking cultural observances like Pride Month.

-       The Smithsonian Institution and FBI closed their diversity offices.

Opposition

However, some companies, including Costco, Apple, Delta Airlines, Cisco, Deutsche Bank, and the NFL, have affirmed their commitment to DEI policies, often citing business value and the importance of a diverse workforce. 

Foreign governments like Belgium and France have also objected to US pressure on their contractors regarding DEI initiatives, emphasising their own national values and laws.

Commercial Effects of the Policies

The commercial effects of these policy shifts have been mixed and sometimes contentious. For companies that have rolled back DEI, a primary motivation is often to avoid political backlash and boycotts from conservative groups. 

The Bad:

However, the retreat from DEI can also lead to negative commercial repercussions. 

Target, for instance, experienced an eight-week decline in foot traffic, averaging a 6.2% year-over-year decrease, and an 8.7% drop in share price following its announcement to curb DEI policies. This suggests a backlash from civil rights leaders and progressive consumers.

Coca-Cola, even while preparing to comply with Trump's orders, warned in an annual filing that abandoning DEI could harm its business by negatively affecting its diverse employee base, which "helps drive a culture of inclusion, innovation and growth".

Additionally, companies rolling back DEI initiatives may face challenges in attracting younger talent. Multiple surveys of Gen Z workers (born 1997-2012) indicate a strong desire to work for organizations that align with their values regarding DEI, making it harder for companies abandoning these commitments to recruit top staff. 

Trade unions, such as GMB and Prospect in the UK, have also expressed concern that multinational companies might adopt "rightwing, regressive, anti-worker approaches" in their UK operations, potentially undermining legal obligations and fairness. 

LGBTQ advocacy groups argue that abandoning DEI commitments is a "shirking of responsibility" to employees, consumers, and shareholders, and is "directly tied to long-term business growth".

Whether a company has chosen to scrap DEI policies entirely or “reassess” the commercial viability of DEI, the widespread corporate response to Trump's anti-DEI stance highlights a volatile and complex commercial landscape that businesses must now navigate. This shift demonstrates the fragility of corporate policies and the true impact of political pressure.

Citations

Education News – Top Stories, Updates & Insights | See News Today https://seenewstoday.com/education/

Nanthini, S., & Lim, J. (2025). Rising to the Challenge: Advancing the Women, Peace, and Security Agenda in Southeast Asia. Asia Policy, 20(3), 44-54. 

McClain, L. (2025). Do Bans On Conversion Therapy Impose A Governmental "orthodoxy" About Sex And Gender? Boston University Law Review, 105(4), 1263-1293.

Iowa struck gender identity from its civil rights law. A parent fears for his transgender child | KHSU https://www.khsu.org/2025-03-06/iowa-struck-gender-identity-from-its-civil-rights-law-a-parent-fears-for-his-transgender-child 

EO 11246 Repeal: What It Means for Your Recruiting Strategy https://www.broadbean.com/resources/blog/recruitment/eo-11246-recruitment-impact/ 

Butler Snow | Trump and DEI: What Does a Second Term Mean for Employers? https://www.butlersnow.com/news-and-events/trump-and-dei-what-does-a-second-term-mean-for-employers 

A message from President Gold on OCR’s “Dear Colleague” letter https://nebraska.edu/president/speeches-communications/letters/2025/02/message-on-ocr-dear-colleague-letter