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Ed Fowkes • 12 February 2025

The Changing Landscape of DEI: A Shift in Corporate Strategy


The corporate world is undergoing a significant shift in its approach to Diversity, Equity, and Inclusion (DEI). What was once a cornerstone of corporate responsibility is now being reassessed, rebranded, or outright dismantled by some of the world’s largest companies, including Google, Meta, Amazon, and Goldman Sachs. This shift is not uniform—some firms remain steadfast in their DEI commitments, while others are responding to legal, political, and financial pressures. Below, we examine how this transformation is playing out across major corporations.


Google’s Strategic Retreat

From Commitment to Compliance
  • Google was once a leader in DEI, particularly after the 2020 Black Lives Matter movement, setting ambitious hiring targets to increase representation in leadership roles.
  • However, an internal memo recently revealed that Google is abandoning its DEI hiring goals, citing legal constraints as a federal contractor and pressure from new U.S. Executive Orders and court decisions.
  • The company is now reviewing all DEI programs, retaining only those that align with business goals and legal requirements.
Political and Legal Pressures
  • The Trump administration has taken a strong stance against DEI, ordering government agencies to **eliminate such initiatives**.
  • Conservative groups, emboldened by a 2023 **Supreme Court ruling striking down affirmative action in university admissions**, have pushed corporations to roll back their DEI policies.
  • Some legal experts warn that corporate DEI programs could face **litigation risks** similar to affirmative action cases.
Google’s New Approach
  • The company still claims to support equal opportunities, but the language in its official reports has noticeably changed.
  • Aspirational hiring goals have been eliminated, but employee resource groups (ERGs) and university partnerships remain. 
  • Google's re-evaluation reflects a broader trend in Silicon Valley, where firms are balancing DEI principles with legal and financial realities.


The Domino Effect  

Meta Is Rebranding, Not Removing 
  • Meta (formerly Facebook) announced it was ending DEI programs, but upon closer inspection, it appears to be repackaging them under different terminology.
  • A leaked internal memo stated that the term “DEI” has become politically charged, leading the company to remove its diversity quotas and hiring frameworks.
  • Despite this, Meta still emphasizes diverse hiring and acknowledges that cognitive and experiential diversity lead to better problem-solving and innovation.
  • Some critics argue that Meta is keeping DEI policies in practice while stripping them of the branding, making them more palatable to conservative stakeholders.

Amazon's A Quiet Departure
  • Amazon has also made subtle but significant changes by scrubbing references to DEI from its official reports.
  • The company ended certain employee groups focused on Black employees and LGBTQ+ rights, consolidating them into broader inclusion efforts.
  • While still promoting an inclusive workplace, Amazon no longer uses the language of DEI to frame these initiatives.

Goldman Sachs Abandons Diversity Pledge
  • In a major reversal, Goldman Sachs has scrapped its policy requiring diverse board members for companies it takes public.
  • This was a flagship initiative introduced in 2020 to encourage more women and racial minorities on corporate boards.
  • The bank now argues that diversity has been sufficiently integrated into corporate governance, making explicit policies unnecessary.
  • However, legal risks and shifts in regulatory environments likely played a role in this decision.

In The UK, Deloitte Stands Firm
  • Not all companies are rolling back DEI commitments. Deloitte UK, in contrast to its U.S. counterpart, has publicly reaffirmed its diversity goals.
  • CEO Richard Houston emphasised that “external pressures do not change our commitment”, highlighting a transatlantic divide in corporate diversity strategies.
  • This contrast reflects broader cultural and legal differences - while the U.S. is experiencing a conservative pushback, the UK remains more committed to DEI.
  • With Labour planning stronger workplace protections and mandatory ethnicity pay gap reporting, UK firms face different pressures compared to their American counterparts.


Pragmatism vs. Principles

Reasons for the Shift
  • The return of Donald Trump’s administration has created a regulatory environment that discourages corporate DEI efforts.
  • Lawsuits and court rulings have increased the liability for companies explicitly using race or gender as hiring factors.
  • Amidst economic uncertainty, businesses are focusing on efficiency and profitability, reassessing the cost-benefit of DEI programs.
  • Some firms fear alienating customers and investors in an increasingly polarised market.

And The Counterarguments
  • Research consistently shows that diverse teams drive better decision-making and innovation, making DEI beneficial beyond ethics.
  • Younger generations, particularly Millennials and Gen Z, expect companies to uphold diversity commitments, which impacts recruitment and retention.
  • While some companies face conservative criticism, rolling back DEI could lead to consumer boycotts and damages reputation among progressive audiences.


Founders and Entrepreneurs 

For SMEs and growing businesses, the evolving landscape of DEI presents both a challenge and an opportunity. Unlike large corporations navigating complex legal frameworks and political scrutiny, small and medium-sized enterprises have the flexibility to craft strategies that are practical, purposeful, and aligned with business outcomes.

The answer isn’t to blindly follow the shifting tides of corporate America or the political pressures influencing global giants. SMEs can adopt a more scientific or engineering approach to DEI. Studies underscore the tangible benefits of diversity in the workplace - from enhanced problem-solving to increased innovation and stronger financial performance. A 2018 McKinsey report found that companies in the top quartile for gender and ethnic diversity were more likely to outperform their peers financially. Diverse teams tend to be better at tackling complex challenges and are more resilient in the face of market disruptions.

But the key is intentionality. Diversity for diversity’s sake does little to improve performance. In fact, overly rigid DEI targets can create friction within teams, dilute company culture and distract from core business goals. 

“Will it make the boat go faster?” If meeting DEI numbers becomes an exercise in bureaucracy rather than a driver of innovation, it’s unlikely to propel your business forward. Instead, founders should focus on where diversity adds real value. F

Creative activities benefit immensely from diverse perspectives, leading to more innovative products, marketing campaigns etc. Tech startups can leverage diversity in cognitive approaches to problem-solving, resulting in more robust, user-friendly technologies. Customer-facing businesses that mirror the demographics of their customer base often build stronger relationships and brand loyalty.

DEI shouldn’t be confined to hiring practices alone. Consider inclusive leadership, where diverse voices are not only present but actively influence decision-making. Build environments where people from all backgrounds feel heard, valued, and empowered to contribute. This isn’t just good ethics - it’s good business.

In the end, DEI for SMEs is about strategic inclusion - understanding when and how diversity drives better outcomes and applying that knowledge with precision. 


So What’s Next? 

A Shift in Language 
  • Many firms are removing the term “DEI” but continuing initiatives under different names. 
  • Future diversity programs may focus on measurable business outcomes rather than moral imperatives. 
  • Companies will likely align diversity programs with anti-discrimination laws, avoiding explicit quotas or preferential hiring policies.
  • Countries like the UK and Canada may continue with an inclusive approach to work practices and investments, while U.S. companies take a more politically conscious approach. 

DEI is Not Dead - It’s Evolving

The corporate world is not abandoning diversity, equity, and inclusion but redefining its approach in response to legal, political, and financial pressures. 

While some companies are walking back explicit commitments, others are quietly integrating diversity efforts into broader business strategies. 
The challenge for businesses moving forward will be to balance inclusivity with risk management, ensuring they remain competitive without exposing themselves to legal and reputational risks. 

This shift is not necessarily a retreat but an evolution. 

February 2025

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