The ripple effects of a DEI rollback

After Walmart's board backtracked on its diversity, equity, and inclusion (DEI) initiatives, big tech companies, including Amazon, Meta, Accenture, and Google, also cut down their targets completely—a trend widely spreading across the corporate landscape. The underlying reasons, it seems, have to do with the national political context, especially now, with the resurgence of Donald Trump - who signed an executive order ending the government's DEI program, and a more conservative stance.

Why DEI policies are facing a setback?

Diversity, equity and inclusion policies are - increasingly - subject to legal challenges, political scrutiny and evolving public opinion. The world's largest retailer announced that it would stop prioritising race and gender in supplier contracts, reduce funding for programmes such as its Center for Racial Equity, and stop participating in prominent benchmarks such as the Human Rights Campaign's Corporate Equality Index.

These moves reflect more than internal strategy adjustments: they reflect a profound shift in the way US companies are dealing with the pressures of social responsibility, legal risk and the political landscape. Walmart's decision, justified as a bid to encourage inclusion of all employees and customers, may be one more piece in the dominoes falling as a result of recent political and social movements in the US.

Tim Stock, Global Culture Analysts writes, "The rollback of DEI initiatives by companies like Target, Walmart, and Meta, reflects a shift in how corporations will address cultural issues in 2025. Under pressure from political and activist groups, many companies are retreating from overt DEI commitments, such as participating in external surveys or publicising diversity metrics"

He quoted Target’s Chief Community Impact and Equity Officer, Kiera Fernandez who said, "These shifts are not regressions but part of a reformation reframing DEI as a foundation for systemic change driven by data and accountability."

Geetanjali K, Strategist & Human Rights Activist differs saying, "Rolling back DEI is a choice not a mandate. It’s really disheartening seeing which companies jumped to rollback these programs the moment the executive order was signed. For the people that’s are celebrating the end of DEI at their company, I would love to understand what opportunities you missed out on because if DEI. Or a more blanket question, how has DEI negatively impacted your work life and even personal life?"

US-based DEI Advocate & Educator, Michael Metro writes, "The systematic dismantling of Diversity, Equity, and Inclusion (DEI) programs represents a profound threat to women's advancement across multiple sectors of society. What began as a collection of uninformed opinion relegated to podcasts and streaming media that catered to a fringe few has now become a widespread assault on hard-won progress in gender equity, with consequences that extend far beyond corporate boardrooms. The numbers are stark. Companies identifying gender diversity as a high priority have already dropped from 87 percent in 2019 to 78 percent in 2024. This isn't just a statistical decline—it's a signal of a dangerous retreat from commitments to workplace equity."

Why Walmart cut back its DEI efforts? 

Walmart’s decision to scale back its DEI initiatives comes in the wake of significant external pressures. In June 2023, the U.S. Supreme Court struck down affirmative action in college admissions, a landmark ruling that inspired conservative legal groups to target corporate DEI programmes. These groups have argued that practices such as supplier diversity and demographic-specific training constitute reverse discrimination.

Walmart’s actions also align with broader cultural and political shifts. Right-wing campaigns, including those led by activists like Robby Starbuck, have aggressively challenged DEI initiatives as excessive or discriminatory. The incoming administration of Donald Trump, whose policy priorities include dismantling federal DEI programmes, further amplifies this climate of scrutiny. Conservative pressure has similarly led companies like Harley-Davidson, Lowe’s, and Tractor Supply to roll back or reframe their DEI commitments.

Despite Walmart’s insistence that many of these changes were planned well in advance, the timing reflects the growing risks companies face in maintaining robust DEI programs. Many corporations are reassessing legal vulnerabilities, particularly those tied to contracts favoring minority - or women-owned businesses. Recent victories by conservative groups challenging such programs highlight the growing potential for litigation.

You may also like: 

• Accenture dismantles DEI programs following Google’s lead
• Google ends its DEI-based hiring targets; Here’s why
• Target’s DEI rollback lands in legal trouble

Is the Middle East planning a DEI rollback as well?

Unlike this global shift, the Middle East views rapid growth as being driven by equal contributions from its diverse workforce, including women and expatriate workers. Leaders see DEI policies as a positive and significant factor in enhancing organisational sustainability.  

The DEI agenda is gaining strength across industries, particularly in the technology sector, where women and workers from diverse ethnic backgrounds are being welcomed as part of a transformative shift. The region is attracting a global workforce with better compensation, inclusive benefits, and opportunities for growth in a supportive and nurturing environment.  

In our recent conversation, Dr. Muhammad Laghari emphasised the uniqueness of the region's diverse workforce, which largely comprises a mix of expatriate and local workers. He noted that this diversity also presents challenges in the workplace, particularly regarding cultural values, work ethics, and expectations. However, organisations investing in cultural intelligence training and developing inclusive HR policies can effectively embrace diversity while fostering collaboration and mutual respect.  

He also underscored diversity and representation, equity and fairness, and inclusive leadership as key pillars of the human capital agenda for organisations to succeed sustainably. He said, "By embedding these pillars into Human Capital Management, organisations can create an environment that values diversity, promotes fairness, and supports the personal and professional growth of all employees."

"DEI will remain a priority, with companies aiming to build more inclusive workplaces and addressing inequities through measurable action plans," commented Muhammad when asked about what future trends will reshape workplaces across industries in 2025. 

Similarly, Tarik Chebib outlined how the Middle East, particularly the UAE, is attracting global tech talent with its unique and competitive offerings. He said, " the UAE is emerging as a diverse and inclusive destination with a highly international mix of people. This naturally brings a certain level of diversity and inclusion due to the variety of clients and cultures we cater to, whether they are Europeans, Arabs, or the South Asian diaspora. We often align our teams to reflect this diversity. However, there is still progress to be made, particularly in areas like female representation. Both the UAE and Saudi Arabia are making significant efforts to promote diversity, inclusion, and women's empowerment, which is attracting talent to the region. They are actively identifying and removing barriers to make these places more appealing to global talent. The quality of life here also plays a major role in this attraction. People work hard, but they also value the balance they can achieve."

Recent surveys also reveal the increasing efforts of leadership and organisations towards DEI in the workplace. 

What are the potential consequences of a DEI rollback?

As Walmart cuts back focus on DEI, it raises questions about how similar shifts might affect workplace equity, employee morale, and talent retention across industries.

While diversity initiatives remain broadly popular, there are signs of waning enthusiasm among the public. A Pew Research Center survey in October 2023 revealed that 52 per cent of workers viewed DEI policies positively, down from 56 per cent earlier in the year. This subtle but significant decline reflects a polarised landscape, where businesses must balance inclusivity with potential backlash from various stakeholders.

DEI Advocate Michael explained the real and multifaceted impact (of DEI rollback) saying, "Women, particularly women of color, face increased barriers in career progression, wage growth, and professional representation. Black women are 51 percent more likely to be pushed out of their jobs within two years, especially in predominantly white work environments. These aren't abstract risks—they're real-world obstacles that threaten individual livelihoods and broader economic participation. Beyond the workplace, the DEI rollback carries profound implications for critical societal systems. Healthcare stands as a prime example. Reduced diversity in medical professions directly correlates with poorer health outcomes. Consider the stark reality that Black women are three to four times more likely to die from pregnancy-related causes compared to white women. Eliminating DEI programs doesn't just reduce numbers—it will costs lives. The ripple effects (not the good ripples) extend to education, public policy, and social services. Fewer diverse voices in decision-making roles mean policies and programs less likely to address the nuanced needs of women from different backgrounds. Research funding for women's health issues could diminish. Mentorship and support systems will erode. This isn't just a setback—it's a systematic unraveling of progress decades in the making. Each dismantled DEI program represents a step backward in the fight for genuine equality. The economic argument is equally compelling. Diverse teams drive innovation. Companies that maintain inclusive environments aren't just doing the right thing—they're maintaining a competitive edge. By rolling back DEI initiatives, organizations risk losing talent, creativity, and market responsiveness. We stand at a critical junction. The choice is clear: recommit to meaningful diversity and inclusion, or accept a future where systemic barriers become more entrenched than ever. This is one of many examples where the consequences of a group of misguided individuals can lead to catastrophic outcomes. This is about more than workplace metrics or corporate policies. This is about fundamental human dignity, access to equitable opportunities, and a culture of compassion and belonging that truly values every individual's potential."

Walmart’s decision also sends ripples through its supplier network. The company’s U.S. operations sourced over $13 billion in goods and services from diverse suppliers in fiscal year 2024, including businesses owned by minorities, women, and veterans. While Walmart insists it will continue to engage with diverse suppliers, removing demographic-specific priorities could reshape these relationships.

Consequences of rolling back DEI programs

• The primary and most significant impact of a DEI rollback is on PEOPLE, especially the employees of an organisation. Companies scaling back their DEI efforts would offer fewer opportunities for persons from underrepresented groups. This would have a negative impact on the company's innovation, creativity, and sustainability, as diverse talent brings more creativity and provides different perspectives. 
• The next impact is disengagement in the workplace. The rollback will act as a demotivator for employees, and the organisation will appear to place less value on an inclusive and equitable workplace. This could result in higher turnover, especially among underrepresented groups.
• The direct impact of such a rollback is on the employer's image in the job market. Companies that strategically cut back on their DEI budgets may suffer reputational damage. This could affect their ability to hire new talent, especially Gen Z workers that prioritises these values in the workplace.
• Companies may also face legal challenges, as the lack of DEI can lead to workplace discrimination or unequal treatment.
• Organisations cutting back on DEI efforts would find it difficult to plan their global expansion, as without a diverse workforce, they would lack the ability to tap into new markets or adapt to changing consumer demands.
• Lastly, scaling back on DEI efforts also affects training for global and multicultural work environments, without which organisations will find it challenging to manage cross-cultural teams or enter international markets.

While the DEI rollback is not solely driven by political pressure, economic factors, including layoffs and financial restructuring, are also at play. However, just as the Middle East has remained largely unaffected by global layoffs, it is similarly not driven by this DEI rollback. Instead, the Middle East is emerging as a great example for the world, standing strong while valuing its people and their diversity.