The death of the idea of ​​affirmative action

Walmart is the latest – but arguably the largest in terms of employment – American company to roll back some or all of its DEI initiatives as pressure on corporate America increased from conservatives emboldened by the impending Trump presidency, the ” “To put an end to wokeism” in American society.

In a radical about-face, Walmart announced it would no longer give some suppliers preferential treatment based on race or gender.

The major retailer has decided not to renew its five-year commitment to a racial justice center founded after the killing of a black man, George Floyd, by a white police officer. It is also withdrawing from a prominent gay rights index. More tellingly, it will no longer sell briefcases or children’s books about transgenderism, a hot topic among conservatives.

Walmart is neither the first nor the only major U.S. company to roll back affirmative action and DEI policies. Automakers Ford and Toyota, motorcycle maker Harley Davidson, and retailers Lowe’s and Tractor Supply have all cut or eliminated many of their DEI initiatives.

Also read: DEI regression: Tractor Supply’s policy shift could backfire

The reason isn’t far to look – fear of customer backlash, the very same fear of “cancel culture” that liberal activists used to force the adoption of such policies in the first place. Perhaps the most telling commentary on the radically changed atmosphere in the United States comes from the Walmart spokesman’s explanation of why the company did what it did: “We stand ready to join forces with our employees and customers who represent all of America “To change,” said the spokesman.

The actions of major corporations like Walmart will inevitably encourage others to follow suit. The question is whether such a movement will spread outside the United States.

Ford CEO Jim Farley said in an internal email to employees that was leaked by anti-DEI activist Robby Starbuck (who also forced Walmart to change): “We recognize that our employees and customers representing a wide range of beliefs.”, adding: “The external and legal environment surrounding political and social issues continues to evolve.”

Farley may be a little behind the curve here. The political and social environment has already evolved. Middle America, which supplies the majority of customers for most brands that have rolled back DEI initiatives, has already made a significant legal shift. Donald Trump’s victory did not mark the beginning, but rather the culmination of this trend, which began some time ago.

Ask Bud Light. The Anheuser-Busch brand came under fire for its controversial partnership with transgender activist Dylan Mulvaney. In April 2023, the beer brand released a special can to celebrate Mulvaney’s “transition to womanhood.” Instead of opening a new market in the LGBTQ+ space as hoped, this sparked a massive boycott from conservative customers, resulting in a 28 percent decline. Worse, Anheuser-Busch stock fell nearly 7%.

Also read: DEI: Don’t throw the baby out with the bathwater

These developments are not just about for-profit companies correcting course to adapt to new market realities. They mark the end – or at least the beginning of the end – of the idea that affirmative action or institutionalized “positive discrimination” can be used to correct perceived social inequalities. It began in 1961 in the USA with then-President John F. Kennedy signed Executive Order 10925, later formalized by his successor Lyndon Johnson, to create equal employment opportunities for African Americans. This laid the foundation for policies that over the years have extended to a whole spectrum of disadvantages based on race, gender or sexual orientation.

Six decades later, things have come full circle. While affirmative action remains enshrined in the U.S. statute books, the U.S. Supreme Court effectively abolished it last year by ruling against affirmative action in college admissions. The actions of major corporations like Walmart will inevitably encourage others to follow suit.

The question is whether such a movement will spread outside the United States. Of course, affirmative action is not an American idea. India, for example, began its affirmative action journey much earlier with the introduction of caste-based reservations, which have now spread to a variety of other concerns, including gender equality. However, this has largely been left to the government, with Indian companies exempt from any legal constraints on reservations or quotas in this regard.

Social pressure, supported by a regulatory push, began to change this. It remains to be seen whether India Inc takes cues from its US counterparts.

Also read: Diversity and Inclusion: A Growing Factor in Mergers and Acquisitions