As debates over corporate diversity, equity, and inclusion practices intensify across America, Costco Wholesale Corporation seems to be standing by its commitment to DEI, despite a recent shareholder proposal that urges the board to reconsider its programs and policies.
The proposal, submitted by the National Center for Public Policy Research (NCPPR), challenges the legality of Costco’s DEI efforts, citing the Supreme Court’s 2023 decision in Students for Fair Admissions v. Harvard, which banned racial considerations in college admissions. NCPPR argues the ruling implicates corporate DEI programs, and alleges that Costco’s initiatives could expose the company to significant legal, reputational, and financial risks.
It also calls on the company to evaluate the risks of continuing its DEI policies and programs and publish a report on its findings, as The Hill reported.
Ahead of its annual shareholder meeting on January 23, the company’s board has urged shareholders to reject the proposal, which it claims is part of a broader campaign against corporate diversity initiatives and reflects “policy bias” rather than genuine concern for shareholder interests.
In a statement to investors, Costco defended its current business approach, claiming that its DEI practices are legally compliant and contribute to the company’s success by fostering a supportive environment for its employees.
“Our success at Costco Wholesale has been built on service to our critical stakeholders: employees, members, and suppliers. Our efforts around diversity, equity and inclusion follow our code of ethics: For our employees, these efforts are built around inclusion – having all of our employees feel valued and respected,” the board of directors wrote in the statement obtained by Fox Business, as The Hill reported.
“Our efforts at diversity, equity and inclusion remind and reinforce with everyone at our Company the importance of creating opportunities for all. We believe that these efforts enhance our capacity to attract and retain employees who will help our business succeed. This capacity is critical because we owe our success to our now over 300,000 employees around the globe,” the board added.
Further, the board argued that the proposed study into the company’s DEI practices would unnecessarily divert company resources.
However, while Costco’s board of directors has indicated its intention to continue the company’s DEI policies, it has also taken the step of rebranding its DEI programs as “People and Communities” programs.
The recent Costco news aligns with growing pushback against DEI practices across corporate America. In 2024, several major companies, including Alphabet, Harley Davidson, Meta, and John Deere scaled back their DEI programs amid economic pressures and legal concerns, as previously covered by The Dallas Express.