Shareholder Proposals and Executive Orders Reshape Corporate DEI Landscape

Adjustments to Diversity, Equity, and Inclusion (DEI) related policies are not only a major trend in the human resources field in 2025, but have also become a focal issue across various industries. In the summer of 2024, the business community had already begun to feel the potential impact of compliance concerns on DEI strategies. Entering early 2025, the battle over shareholder proposals continued to intensify. Around the inauguration, U.S. President Donald Trump signed at least five executive orders involving identity and equity issues in the public and private sectors, further escalating the debate.

As the external environment continues to evolve, what climate do private employers face regarding DEI issues?

The John Deere Case: A Sample of Shareholder Proposal Battles

In July 2024, tractor manufacturer John Deere announced it would no longer participate in "external social or cultural awareness parades, festivals, or events" and would audit its mandatory training materials to "ensure there are no socially motivated messages," among other adjustments. The company stated in its announcement that business resource groups would focus on talent development and that John Deere remained committed to building a diverse workforce.

"Our customers' trust and confidence in us is critical to every John Deere employee. We are fully committed to earning that trust every day, in every way." — John Deere official Twitter, July 16, 2024

However, in the absence of a clear DEI framework, how John Deere will advance its workplace culture and talent strategy remains an open question. Shareholder Amalgamated Bank raised concerns through advocacy organization As You Sow, and Deere attempted to dismiss the proposal with a "no-action request." The U.S. Securities and Exchange Commission (SEC) ultimately rejected this request.

Initially, Deere rejected the proposal, citing that the conservative think tank National Legal and Policy Center (NLPC) had already made a similar request to outline DEI programs and policies. NLPC asked Deere in September 2024 to "produce a report of recruitment statistics data broken down by race and gender."

The SEC stated in a January 3 filing: "We are unable to concur that your company may exclude the proposal. We believe that the proposal does not substantially duplicate the proposal submitted by NLPC." The proposal asks the company to "publicly report on its effectiveness in establishing a meritocratic workplace—one in which no one is excluded from the company's success based on immutable characteristics such as gender, race, or ethnicity." The SEC ruled that this request is not the same as NLPC's request.

Expert Perspective: Communication Transparency Is Key

Meredith Benton, founder of Whistle Stop Capital and program director for workplace equity at As You Sow, spoke with HR Dive about her years of experience working with companies—some of which made headlines last summer for adjusting their DEI strategies. Regarding the proposal submitted on behalf of Amalgamated Bank, Benton said: "The catalyst for the proposal was their summer announcement, which was quite vague about the specific types of changes." She added: "Deere now has the opportunity to more clearly communicate the effectiveness of its programs and outcome data from related initiatives."

As You Sow was founded in 1992, focusing on corporate social responsibility long before the DEI surge triggered by the George Floyd incident. Benton also noted that her team had been writing to hundreds of companies on behalf of shareholder interests, inquiring about their DEI practices, before 2020.

Corporate Implications: The Potential Costs of Strategic Shifts

Publicly announcing the termination of DEI programs can have negative consequences. While leaning toward so-called progressive values may trigger consumer backlash (as seen in the Bud Light case), leaning toward conservative positions can also invite boycotts. Polls by the Human Rights Campaign during the early wave of rollbacks showed that LGBTQ+ individuals might leave or boycott companies that downplay DEI.

In the agricultural equipment industry, for example, the National Black Farmers Association called for Tractor Supply CEO Hal Lawton to resign over the company's DEI policy shift. One lesson summarized by marketing and business experts is that when a company's consumer base is far more diverse than expected, DEI rollbacks can lead to unintended consequences.

Now, the Black community is calling for a massive boycott of Target in response to its DEI strategy adjustments—which has frustrated Black business owners and renowned chef Tabitha Brown, who has partnerships with the company.

Key Topic for 2025: Redefining DEI

Although annual conference discussions about diversity have only recently become a focal point, shareholder proposals have long been a battleground for DEI issues. As You Sow CEO Andy Behar said: "We have always advanced this work from a shareholder perspective—that is, from a financial and economic angle." He questioned: "Now some people say the Los Angeles fires were 'caused' by DEI, and the military's lack of lethality is also 'caused' by DEI. What exactly are we talking about?"

Earlier, two industry experts told HR Dive that defining DEI this year is crucial. One consulting firm COO noted that the three-letter acronym has become synonymous with "demonization." She said it is precisely the ambiguity surrounding the term that makes it easy for critics to exploit the fear it generates.

Behar added: "A robust workforce will bring more diverse voices, which will shape a corporate culture that attracts the best talent." In this context, companies must navigate what Benton calls "the actively distorted concept of DEI."

The Trump Era: Where Does the Private Sector Go?

Before Trump signed the executive orders, the DEI battle was already brewing. McDonald's made a statement early in the year, favoring "global inclusion" over DEI. In response to anti-DEI proposals, Apple reaffirmed in a January SEC filing that its compliance practices (including recruitment-related practices) are robust. Meta also adjusted its DEI direction this year. Notably, data shows Meta employees are divided on the decision: 43% agree, 45% oppose, and 12% are unsure.

Trump then issued executive orders, some of which impact the private sector. Even so, JPMorgan Chase CEO Jamie Dimon said at the World Economic Forum in Davos, Switzerland, that he welcomes challenges from anti-DEI activists. Meanwhile, attorneys general from 19 states sent a letter to Costco on January 27 applying pressure. The tone was unclear before Inauguration Day, but a series of actions from the executive branch and red states have re-emphasized the president's stance.

Facing new compliance concerns, escalating shareholder disputes, and dissatisfied consumers, where will other private sector employers go? Last Friday, SHRM held a briefing; Emily Dickens, the organization's chief of staff, head of government affairs, and corporate secretary, encouraged companies not to abandon DEI efforts. She said now is the time to reassess DEI programs and policies to ensure compliance.

Meanwhile, Benton, who has a comprehensive view of corporate governance, said: "We will continue to see significant shifts in how companies describe their related work." But she added: "I don't think there will be substantial changes in internal policies—partly because these companies plan to operate for far longer than four years." She also noted: "If companies don't maintain strong internal practices, they may plant seeds of trouble during this administration and be held accountable in the next cycle." As a professional who works with companies long-term, Benton said she has not observed "a broad wave of opposition in American society to the concept of inclusion. Equal opportunity for all is a very American ideal."