Corporate Diversity Programs Rollbacks Intensify
Amidst increasing scrutiny from Washington, D.C., Citigroup (C) and PepsiCo (PEP) have announced revisions to their Diversity, Equity, and Inclusion (DEI) policies.
Citigroup Retreats from DEI Initiatives
CEO Jane Fraser stated that the bank will no longer mandate the selection of diverse candidates for new hires. The "talent diversity, equity, and inclusion" team will also be renamed "talent management and engagement."
PepsiCo Sunsets DEI Goals
CEO Ramon Laguarta confirmed that PepsiCo will eliminate its dedicated DEI officer, discontinue diversity workforce representation targets, and broaden its supplier base. The company emphasizes its commitment to inclusivity while ensuring merit-based hiring and promotion.
Other Business Reductions
Citigroup and PepsiCo join a growing list of corporations embracing similar DEI retreats, including Meta, Walmart, McDonald's, and Ford. This trend follows a 2023 Supreme Court ruling against race-conscious admissions at universities, and an executive order from former President Trump prohibiting federal DEI programs.
Impact on Financial Institutions
Goldman Sachs (GS) has removed a requirement for IPO clients to include women and minorities on their boards. JPMorgan Chase (JPM) has significantly reduced references to DEI in its annual report. CEO Jamie Dimon expressed skepticism about bias training and questioned the effectiveness of certain DEI programs.
Conclusion
The withdrawal from corporate DEI programs in the U.S. is gaining momentum. Legal and political changes, as well as skepticism about the efficacy of some DEI initiatives, are driving these adjustments. Companies are re-evaluating their approaches to ensure alignment with regulatory guidelines and prioritize merit-based practices.