On his first day back in the White House, Donald Trump signed an executive order requiring the federal government to “terminate all mandates, policies, programs, preferences, and activities relating to ‘diversity, equity, inclusion, and accessibility.’”
The next day, the president extended his purge into the private sector. A second executive order compelled government agencies to certify that organizations receiving grants or contracts do not operate DEI programs. The directive also warned private companies and colleges against maintaining “illegal DEI programs,” presumably referring to a 2023 Supreme Court decision that found colleges’ race-based admissions programs unconstitutional.
Even as the American Civil Liberties Union protested that DEI policies “helped dismantle entrenched race and sex segregation in high-paying industries,” thousands of civil servants were losing their jobs, and companies such as Google, Walmart and McDonald’s started erasing formal DEI policies.
But some companies stood strong. Delta Airlines said DEI values “are critical to our business.” Soap-maker Lush introduced three new bath bombs: Diversity, Equity and Inclusion.
The most prominent stalwart was probably Seattle retail giant Costco Wholesale, whose board voted down a proposal from a right-wing think tank to research the “risks” of maintaining its DEI program. The board said “our commitment to an enterprise rooted in respect and inclusion is appropriate and necessary.”
With its motto “Do the right thing,” America’s third-largest retailer has always been an outlier. Founder James Sinegal believes businesses succeed by doing well by their employees. “We’re proud that Costco pays the highest wages among our peers, that we provide benefit and health-care packages that are second to none, and that we’ve grown our business by promoting from within,” he said in 2012.
Three days after Trump’s executive order, chair Tony E. James said Costco’s commitment to inclusion “has never included quotas or systematic preferences, nor does it mean compromising merit. The demands of our business and our steadfast commitment to serve our members mean that we cannot afford to do anything but hire and promote the most qualified individuals.”
Four days later, 19 Republican state attorneys-general wrote a warning letter chastising Costco for “doubling down” on DEI in defiance of federal and state laws. While this story isn’t over, Costco’s stance earned it a 22% increase in online traffic on February 28, the day of a consumer boycott in support of DEI. That day, competitors Walmart, Amazon and Target all saw traffic declines.
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