A coalition of 58 conservative asset managers issued an open letter to more than 1,000 U.S. corporate CEOs demanding disclosure.
The incoming Trump administration could put new pressure on companies to drop race- and gender-based employment programs, a coalition of money managers stated in a warning to America’s largest companies.
Last week, 58 conservative asset managers, state treasurers, and nonprofit groups issued an open letter to more than 1,000 U.S. corporate CEOs demanding that they disclose to shareholders the extent to which they impose diversity, equity, and inclusion (DEI) policies on employees and contractors. Such programs, the authors say, could harm staff, sales, and stock prices, and create legal liabilities if they are found to violate civil rights laws.
“It’s important that these companies recognize and understand that the DEI-ESG regime is coming to an end,” OJ Oleka, CEO of the State Financial Officers Foundation and a signer of the letter, said, referring also to environmental, social, and governance (ESG) principles.
“DEI, the regime that it offers, is simply un-American,” he said. “It’s not good for the values that we stand for as a country … that this is a nation of meritocracy, that societies need to function because of the rule of law.”
DEI programs took a significant hit when the U.S. Supreme Court ruled in the 2023 case of Students for Fair Admissions v. Harvard that publicly funded schools could not discriminate on the basis of race or gender, and justices wrote in their majority opinion that “eliminating racial discrimination means eliminating all of it.”
Legal analysts say that America’s civil rights laws also apply to private companies, and they expect the incoming Trump administration to take a harder line in enforcing these laws.
“The election results are really a jumping off point, I think, to truly winding down and bringing to an end DEI programs and practices inside of corporate America,” said Jeremy Tedesco, senior vice president of corporate engagement for the Alliance Defending Freedom (ADF). “The Trump administration is going to most likely create serious legal and reputational consequences for companies that continue down that path.”
