Much has been made of the politicisation of ESG over the past year, of corporate America backing away from the acronym and of its evolution to be badged in other ways.
Within overall ESG programmes, it now seems that diversity, equity and inclusion (DEI) initiatives have become similarly contentious, with some companies feeling that they have to walk on eggshells to continue or to change their efforts, while employee support for positive advances typically remains strong.
This week, an extensive BBC Lifestyle piece proclaimed that “DEI is a lightning rod for controversy” and outlined that while DEI programmes, accelerated by high-profile tragedies in recent years, have generally delivered strong social and commercial payback for companies, many are now nervous about reinforcing their commitments and talking publicly about what they are doing, amidst growing criticism. The “loudest opposing voices are hedge-fund manager Bill Ackman and Elon Musk,” the BBC reported.
“Amid the past three years of widespread layoffs, DEI programmes and the professionals who led them took a blow. Looking for cost savings, many companies dismantled DEI-focused initiatives, and in some cases, eliminated entire departments responsible for the advancement of marginalised workers,” the article said.
The piece gave a US-weighted view, but some of the concerns and the prospect of crossfire are surely applicable in the UK too.
Bloomberg also reported this week that JP Morgan and Goldman Sachs have both softened their DEI approaches, with the headline that “Wall Street’s DEI retreat has officially begun”.
It is easy to rubbish this ‘controversy’ as the media looking for clickbait headlines, of course. A decision not to shine so much light on DEI commitments, or to broaden the parameters of a change programme to avoid accusations of overly restricting opportunities for some employees while weighing them too much in favour of others is simple to badge as a ‘retreat’. But the more accurate summary may be that companies have taken their foot off the accelerator, or are wanting to make progress behind closed doors rather than in public.
Creative Review summarised the mood in the agency world this week too, with an opinion article appealing for companies not to give up on DEI.
Given the value that many a management consultancy will say DEI can bring to business and society, and the many examples of positive returns, it is hard to see why employers would abandon their efforts.
As that BBC piece pointed out, initiatives to improve equality have been in existence for decades, they have just been hugely accelerated and become much more prominent in the past few years. And as many would say, rightly so.
In other news, a federal appeals court has ruled that a Florida law pushed by Governor Ron DeSantis that limits diversity and race-based discussions in private workplaces is unconstitutional. So the anti-woke movement will likely face tough times ahead too.
Many of the corporate pressures around DEI seem to be being felt in the US currently, and with an historic - though for many, uninspiring - presidential election on the horizon, that is not really surprising. For UK companies, the question is how that may impact their DEI communications, given the landscape, and the critical voices, may be different here.
The ESG News Review is written by Steve Earl, a Partner at PR agency BOLDT.