On Jan. 23 2025, Costco Wholesale’s shareholders—with over 98 percent voting against—rejected an internal proposal to the Costco Board of Directors put forward by a conservative think tank known as the National Center for Public Policy Research (NCPPR). This proposal, had it been passed, would have requested the Costco Board “conduct an evaluation and publish a report” on “the risks of the company maintaining its current Diversity, Equity & Inclusion (DEI) … roles, policies and goals.”
This recent shareholder vote followed a previous response from the Costco Board of Directors in their 2025 Annual Shareholders’ Meeting Notice to the NCPPR’s initiative that unanimously recommended against its implementation.
Costco’s decision to maintain DEI initiatives stands in contrast to a number of other companies such as Walmart, Target and Meta who have, in recent years, opted to re-examine, modify or roll back policies and commitments regarding their own DEI programs in response to conservative backlash. The Costco Board of Directors has defended their decision, reaffirming the company’s commitment to “an enterprise rooted in respect and inclusion,” citing the fostering of “creativity and innovation” as merits of their program, and describing the NCPPR’s proposition as reflecting “a policy bias with which [they] disagree.”
Originating during the Civil Rights and progressive movements of the 1960s, DEI programs trace their roots to the affirmative action and anti-discrimination policies implemented as part of the Lyndon B. Johnson administration’s “Great Society” agenda. Under the Civil Rights Act of 1964 – a federal law that prohibits employment discrimination on the basis of race, color and sex, amongst other classifiers – and alongside the creation of the Equal Employment Opportunity Commission (EEOC), the federal government was mandated to combat entrenched systemic discrimination within public and private institutions.
DEI programs were the result of corporate shifts in response to discrimination lawsuits filed with the EEOC throughout the 1960s and 1970s. These programs provide anti-discrimination training and expand hiring and promotion pools to include more qualified candidates to counteract systemic race and gender discrimination. The purpose of these affirmative action programs has been to comply with anti-discrimination statutes and improve employee performance.
The landmark 2023 Supreme Court decision on Students for Fair Admissions (SFFA) v. Harvard reversed previous court decisions and, under the majority decision of the conservative justices, established a legal framework against long-standing affirmative action policies implemented throughout the 1960s.
Conservative groups such as the Wisconsin Institute for Law & Liberty and America First Legal have—especially following the SFFA decision—engaged in a protracted legal campaign to target equal opportunity initiatives in the name of fighting DEI. Stephen Miller, a former adviser to the Republican administration under President Trump, alleges that corporate policies “punish Americans for being white, Asian or male.” In their fight against DEI, conservatives have insinuated that “civil rights law itself” may be “somehow part of the problem.”
President Donald J. Trump opened his term by repealing a litany of executive orders that have long stood as foundational cornerstones and institutional safeguards of civil rights in a Jan. 21 executive order to fight “illegal discrimination.” In that same order, President Trump called for the Attorney General, in cooperation with other federal agencies, to make recommendations to “encourage the private sector to end illegal discrimination and preferences, including DEI.”
An article from The National Law Review states, “The executive order does not define the specific DEI programs or activities it deems to be illegal.” The EEOC, in response to the SFFA v. Harvard decision, has clarified that DEI initiatives remain lawful in their implementation. Furthermore, several states’ Attorneys General have affirmed that the SFFA v. Harvard decision is a “narrow ruling” that “does not prohibit private corporations from implementing DEI initiatives.”
Despite these clarifications, Costco’s decision to join a collective of other companies in maintaining DEI initiatives has faced a legal response. A group of Attorneys General from Iowa, Alabama and Kansas, among others, issued a letter to Costco’s CEO declaring that “the company is doing the wrong thing” by “clinging to DEI policies that courts and businesses have rejected as illegal.” Costco has yet to comment.
Although President Trump’s executive order attributes failures in the public and private sectors to guarantee merit-based opportunity to DEI, experts say that many corporate practices conducted as part of DEI initiatives—such as auditing employee pay and ensuring appropriate promotions—are organizationally necessary to comply with federal and state anti-discrimination statutes. These experts argue that DEI programs, rather than fighting against the idea of merit-based employment, instead help guarantee its implementation.
