Corporations are losing business like they’ve never seen. Many are re-assessing their diversity, equity, and inclusion (DEI) programs in the wake of an executive order signed by then-Pres. Donald Trump. This executive order would not just haphazardly limit DEI-related work. It would further halt all federal grants and contracts to any company that persists in maintaining DEI related endeavors. Businesses remain confused by the fallout from the unpredictable political environment. This change has a direct effect on their promises to stand in solidarity and support marginalized queer and transgender communities.
The recent rollback of DEI initiatives at all levels of American government has alarmed queer and transgender business owners across the border in Canada. Long term economic consequences Others worry that this decreased commitment to diversity will have negative economic consequences in the long run. And Google and Home Depot—a pair of top-tier corporate sponsors—have already pulled their financial support for Toronto’s Pride parade. The drumbeat of the trend is not limited to Canada. Google, Meta and Amazon have all increased the scrutiny on DEI programs.
As corporations continue to feel the pressure to change, many of them are choosing to implement minor changes. They are swapping out explicit mentions of these terms for relatively neutral language such as “belonging.” This change is part of a larger effort to stay true to the spirit of inclusiveness as they work in the contentious and often chaotic political landscape.
Industry experts say this rollback of DEI initiatives will keep on coming in the months—and likely years—ahead. Eddy Ng, a professor who studies diversity management, highlights the concerns that companies are feeling. Second, they worry about stifling backlash from an unpredictable Trump administration. He points out that “Google and Home Depot are American multinationals doing business in Canada. So of course, they’re worried about any backlash given the Trump administration’s position on these issues in the U.S.
The stakes of this new corporate dynamic reach well beyond specific corporate announcements. Ng emphasizes that “Pride isn’t just a one-month thing, because people don’t just disappear for the rest of the year.” Hahn believes that Pride events are important and sometimes necessary reminders of the work and sacrifices accrued by marginalized communities.
Darrell Schuurman, CEO of the Canadian Gay and Lesbian Chamber of Commerce (CGLCC), recognizes that corporations have had a varying response to the idea. “There are some corporations who are still actively committed to supporting the queer community, but perhaps reframing or reshaping what that looks like,” he says. He acknowledges that some companies are retreating from their prominence. They’re still doing so, just in less visible forms. “Some are scaling back in terms of exposure, but they are still there, in some way, supporting financially, just with less visibility,” he states.
The budgetary consequences of these modifications must not be ignored. For many companies, billions have already been committed to DEI programming and support over the past several years. Yet, as Schuurman notes, “It’s hard to really quantify the benefits of diversity, so it is something that they can easily divest from without needing a strong, compelling justification.” In conjunction with the recent downturn, this has caused many businesses to re-evaluate their discretionary spend on DEI initiatives.
For those corporations, it would make sense to curtail their public-facing support for DEI work. A more sober assessment is needed before declaring that they’ve fully pulled out their promise. Ng argues that the private sector has struggled to quantify the clear and concrete benefits of these programs. “When it comes to discretionary spending, DEI is something that they can easily drop, and that’s why you see sponsors drop out of Pride,” he explains.
As businesses pilot their way through these turbulent waters, many find themselves questioning where and how they should be contributing to the protection of human rights. “If this is something that we value as fundamental human rights, then we should all support,” Ng asserts.
