ESSAY
FEB. 2025

A Brief History of DEI in North America

BY OPENING ROUND

DEI means many different things to many different people. Finding a shared definition in 2025 is nearly impossible — nonetheless, it is subject that continues to dominate conversations across a wide range of sectors. Regardless of what DEI means to you, it is beginning to look like an endangered species in North America. A new administration in the United States has prioritized an aggressive rollback of DEI programs and it has the potential to significantly change things in a meaningful way in both public policy and corporate America.

DEI is an umbrella term for policies designed to create more opportunities for minorities and underrepresented groups and promote the advancement of women in business. DEI is rooted in an understanding of the role that unconscious bias plays in decision making within organizations. The goal of DEI is to promote a more merit-based system of hiring, recruitment and advancement within organizations by opening doors for people who have historically been marginalized.

Unconscious (or implicit) bias is a term that describes the associations we hold, outside our conscious awareness and control. Unconscious bias affects everyone. Unconscious bias is triggered by our brain automatically making quick judgments and assessments.

The counter argument to DEI rests on two core beliefs:

  1. DEI has never been meaningfully effective.

  2. The policies and programs are discriminatory against white men.

Critics assert that DEI creates a less meritocratic system by favouring groups over others and discriminating against large groups of people, notably white men.

Affirmative Action and The Civil Rights Movement

The concept behind the DEI movement dates back decades with deep roots in the Civil Rights Movement In America.

In the 1960s, Lindon B Johnson signed legislation making it illegal for federal contractors to discriminate on race. Title VII of the Civil Rights Act of 1964 prohibited discrimination, leading to mandatory training for employees. The  act was a was a landmark civil rights and labor law in the United States that made discrimination based on race, color, religion, sex, or national origin illegal for employers with more than 15 employees to discriminate in hiring, termination, promotion, compensation, job training, or any other term, condition, or privilege of employment.

For decades, affirmative action saw broad bipartisan support across industries.

The BLM Effect

In May of  2020, after the murder of George Flloyd in the hands of a police officer, the movement for racial justice intensified. The moment spurred a reckoning for companies and widespread conversation about how companies think about race at work. This moment was also a launchpad for a nearly universal commitment in the tech and venture capital ecosystem to ‘do better’ by marginalized groups in a myriad of ways, including:

  1. Better reporting to support strategic initiatives to level the playing field in venture

  2. Dedicated funding for underrepresented founders

  3. Inclusive approaches to brand, product and marketing development in corporate America

  4. Unconscious bias training and re-shaping internal corporate policies to create a more inclusive environments at work

  5. Conversations around structural inequality

Affirmative action → DEI

AA and DEI are grounded in similar concepts of fairness and inclusion, but meaningful differences between the two approaches have created a deepened cleavage in the attitudes in corporate America towards the underlying issues and how they get solved. Affirmative action was meant to ensure discrimination was not taking place and do whatever was necessary to correct for that.

Case Study: Abercrombie and Fitch’s Diversity Score Card

In June 2003, the LDF filed a class-action lawsuit against Abercrombie & Fitch, alleging discrimination against Black, Latino, and Asian American applicants. The lawsuit claimed that the company refused to hire qualified minorities and assigned them undesirable positions when hired. Filed by nine young adults, the suit sought to end discriminatory practices and demanded monetary damages. In 2004, a settlement was reached, awarding $40 million to affected individuals and requiring Abercrombie to implement diversity policies, appoint a Vice-President for Diversity, and establish benchmarks for hiring minorities, effectively ending its discriminatory employment practices.

The Rise of the Chief Diversity Officer

Companies began scrambling to hire senior leaders within their organizations to manage and develop DEI policies and initiatives. In 2018, less than 50% of companies in the S&P 500 employed someone in the role of CDO, and by 2022 3 out of 4 companies had created the position. 

But the enthusiasm didn’t last. These initiatives  hit two major roadblocks after the proliferation of DEI in corporate:

  1. Unconscious bias is difficult to measure and quantify

  2. Mandatory training was often unpopular

  3. People who supported DEI goals were often critical of the motivations behind these initiatives

The mixed results from DEI initiatives lead to mass exodus from the CDO role and significant skepticism on many sides of the initiative. Lululemon was one of many companies in recent years that has struggled to adopt DEI policies in full.

Lululemon's Hyde Park store in Chicago faced allegations of racial discrimination after employees reported a corporate culture unwelcoming to Black staff. Despite a commitment to diversity, employees claimed they encountered barriers to advancement and were often overlooked for promotions compared to white colleagues. The store, which aimed to reflect the local community, was closed in August 2023, leading to multiple EEOC complaints. Former employees described a disconnect between the company's diversity initiatives and actual support for minority employees, suggesting that the efforts served more to protect Lululemon's image than to foster genuine inclusivity.

DEI, built on the concepts of affirmative action, is broader. Aimed at creating programs aim to promote opportunities for women, veterans, minorities and other historically underrepresented groups. As corporate America embraced DEI in the wake of the death of George Flloyd and the global movement in response to it, they began to make very public hires to address issues of discrimination in the workplace. 

A Supreme Step Backwards

In 2023, a landmark ruling from a highly politicized Supreme Court in the US struck down affirmative action. The ruling ensured that colleges and universities could no longer rely on race to make decisions in recruitment processes. The ruling catalyzed a culture shift away from the adoption of DEI and opened the flood gates for critics of the initiative. Conservative legal activists started filing lawsuits against organizations that were focused on serving women and minorities or providing grants to specific groups based on identity.

Case Study: Fearless Fund

The Fearless Fund, an Atlanta-based venture capital firm, has decided to permanently close its grant program for Black women business owners following a settlement in a year-long affirmative action lawsuit. The program, known as the Fearless Strivers Grant, was challenged by conservative activist Edward Blum, who argued it was discriminatory against non-Black women. The settlement allows the Fearless Fund to continue its other activities without restrictions. This case highlights the ongoing debates surrounding diversity initiatives and affirmative action, particularly as such programs face increasing legal challenges across various sectors.

The Anti-DEI Administration

The incoming Trump Administration has prioritized the dismantling of DEI initiatives in America.

  1. Ordered an end to DEI policies across federal agencies.

    1. All staff in the programs were put on paid leave

  2. The departments of agriculture, the treasury and labor removed webpages on diversity in Trump’s first week

    1. Notably the labor department had a page on “The History of Diversity Equity and Inclusion” that has since been removed taken down

  3. A tip line to report DEI initiatives across the federal government and its contractors

    1. The administration stated that there would be diverse consequences for failure to report

  4. Schools with endowments of more than $1 billion dollars have been instructed to investigate DEI programs

  5. The  executive order setup by former president Lyndon B Johnon in the 60s that instructed government contractors  to proactively root our discrimination on the basis of race and gender

  6. Each government agency has been instructed to identify the ‘most egregious’ companies, non-profits, foundations and other private sector organizations for potential civil investigation

A slew of major companies have publicly moved away from DEI goals including Meta, Target, Ford, McDonalds and Walmart. However, Jamie Diamond, the CEO of JP Morgan Chase is among a group of CEOs holding out on  the Trump Administration’s mandate to turn away from DEI. At a conference in Davos Diamond committed to a continuation of outreach programs to the black community and other minorities groups. Costco is leading the way in openly defending DEI initiatives by publicly rejecting a shareholder proposal to end DEI initiatives  and creating a template for other companies to do the same.

While the future of inclusive practices in business is very uncertain. With our years of aggressive pushback against DEI all but guaranteed, there is need for companies, governmental opposition and to continue to make the case + create environments that minimize the damage to the most vulnerable and underrepresented groups in North America. DEI programs are likely to be a thing of the past in America, but companies have the potential to continue the important work of supporting equity-deserving groups without the label.

“Prejudice is a burden that confuses the past, threatens the future and renders the present inaccessible”.