Trump is ditching bonkers diversity policies but will UK put common sense before rainbow nonsense

IN less than a month, US President Donald Trump has demolished the DEI industry in America. The acronym, which stands for diversity, equity and inclusion, had created armies of consultants as policies became embedded in every corner of corporate life. Companies had built huge teams, often recruited from the not-for-profit sectors, as they became obsessed about ensuring their logos coordinated with the right sort of rainbow.

Every occasion was matched with millions of dollars of marketing spend. But the pendulum had swung too far one way to match what was the perceived vibe of the time. Now, just days after Trump promised to terminate DEI policies in the federal government, and issued an executive order that determined there were just two sexes, companies are rushing to ditch their DEI drives. The so-called “vibe shift” across Wall Street and Silicon Valley has been extreme enough to cause whiplash.

The speed confirms what many had suspected all along — that it was just grandstanding and lip service. The question is, will the death of DEI now spread to the UK?. In recent weeks, tech firms Google, Amazon and Meta have scaled back their DEI teams, after their chief executives sat in the front row at Trump’s presidential inauguration. Google’s chief diversity officer since 2019 updated her LinkedIn profile this month to the job of Googler Engagement.

The world’s biggest search engine also removed all mention of black, LGBT and women’s holidays from its digital calendars. Global accounting firm Deloitte has told employees in the US to strip gender ­pronouns (he/him, she/her, they/them) from their email profiles. Wall Street firm Goldman Sachs has ditched its own diversity rules that banned it from advising on company listings of firms that had “all male, all white boards”.

Boss Richard Gnodde claimed that the initiative had now done its job. Consultancy firm Accenture has made headlines by “sunsetting” its employee diversity goals and career development plans and scrapping diversity bench-marking. It is a real battleground in the US, with retail giant Target facing a class-action lawsuit by investors who claim the firm’s DEI initiatives led to a consumer backlash against its Pride merchandise, causing a sales slump and falling share price.

Meanwhile, firms ranging from American Express and Apple to Coca-Cola and Warren Buffet’s investment fund Berkshire Hathaway are all facing shareholder votes over their DEI initiatives and hiring goals. It is a testing time for global firms who now have to choose where to situate themselves, with different DEI treatment for employees depending on whether they are in the US or the UK. Cynically, it might come down to where they make the most revenue.

There are also plenty of companies who have been panicked into ditching DEI labels on the surface but are quietly rebadging them as something else. It emerged last week that BT is ­­s­crapping DEI bonuses for managers, shortly after boss Allison Kirkby said that she was committed to “inclusion”. Deloitte in the UK has told staff to keep gender pronouns on their emails, showing the global disconnect for some firms who had spent years shouting proudly about their diversity initiatives.

But other businesses in the UK are already lobbying the regulator to tear up diversity targets for companies. They argue that with Labour’s looming Employment Rights Bill there will, as the legislation stands, be enough endless red tape that will stifle hiring. The backlash in British business was already brewing. Marmite maker Unilever was ridiculed by one of the City’s biggest fund managers, Terry Smith, for “losing the plot” by trying to give “purpose” to Hellmann’s mayonnaise — rather than making money from the sandwich spread.

A year later, Unilever had to tell bosses at Ben & Jerry’s to get back in their box for taking an outspoken stand on the Israel-Palestine conflict. Ice cream and geo-politics shouldn’t mix. It was seen as a clear example of companies being blind to their real business, and as DEI became commoditised through box-ticking it just became another form of groupthink. Ditching DEI will become a balance-sheet decision.

As one business leader pointed out: “A room full of people from different ethnic backgrounds who all think the same way does not equal diversity.”. One former tech executive told me this week that it was obvious US firms were being driven to drop their DEI agendas because they are ultimately in the business of making money. American companies have been explicitly told that they will miss out on government contracts if they do not change to fit Trump’s gender ideology.

They also fear that being seen on the wrong side of Trump will mean less favourable hearings when it comes to regulation — something that makes the banks and tech bros intensely nervous. As a result, ditching DEI will become a balance-sheet decision. One exec quipped that staff who feel aggrieved by the disbanding of eight years of their work “should remember they are working for a for-profit business, not a mission-driven charity or an NGO”.