Many big American companies are backing away from DEI policies this year as scrutiny intensifies in Washington, D.C., but stockholders are not necessarily in favor of more measures that question diversity initiatives.
The latest example came earlier this month, when Berkshire Hathaway (BRK-B, BRK-A) investors gathered for the company’s annual shareholder meeting in Omaha, Neb.
Stockholders in Warren Buffett’s conglomerate voted down two measures from DEI critics that would have required Berkshire’s holding companies to report risks associated with race-based initiatives and designate a board committee to oversee DEI strategies across its businesses.
Berkshire controls 189 operating businesses that employ nearly 400,000 people, so any such policies would have had widespread implications. Earlier this year, it stripped out some language in its annual report discussing diversity and inclusion.
Shareholders take their seats inside the CHI Health Center Omaha for the Berkshire Hathaway annual meeting on May 3, in Omaha, Neb. (AP Photo/Rebecca S. Gratz) ·ASSOCIATED PRESS
That’s not to say the same Berkshire stockholders were ready to give a thumbs up to more diversity measures, either. They rejected one proposal that would have required Berkshire to issue a report on pay disparity.
That same pattern has repeated at many other big companies thus far during annual meeting season, pointing to a broader fatigue with the topic of DEI, which refers to diversity, equity, and inclusion.
As of May 8, shareholders had voted down 17 anti-DEI proposals, and 14 were either omitted or withdrawn from ballots, according to proxy advocacy firm ISS Corporate. A total of 52 were introduced, with more votes yet to happen this spring and summer.
Anti-DEI proposals were almost unanimously rejected by shareholders at Apple (AAPL), Disney (DIS), Deere & Company (DE), Levi Strauss & Co. (LEVI), Goldman Sachs (GS), Boeing (BA), Wells Fargo (WFC), American Express (AXP), Coca-Cola (KO), and Costco (COST).
“Shareholders overwhelmingly voted against resolutions to end DEI and backed management maintaining merit-based diversity programs focused on financial performance,” said Andrew Behar, CEO of As You Sow, a nonprofit organization that advocates for environmental and social corporate responsibility.
Yet pro-DEI proposals have fared no better.
As of May 8, roughly 44 pro-DEI proposals were on corporate America’s ballots this year, according to ISS Corporate. Among those that went to a vote, none have thus far gained shareholder support as of that date. Seven failed, and 15 were omitted or withdrawn.
Pro-DEI proposals were voted down this year at Deere, Pilgrims Pride (PPC), AutoNation (AN), AO Smith (AOS), Lennar (LEN), Genuine Parts (GPC), and Wells Fargo.
In some cases, anti-DEI proposals have failed to even reach a vote. At IBM and AT&T, shareholders backed down from pushing anti-DEI proposals to a vote after the companies changed their diversity policies.
At Pfizer, the Securities and Exchange Commission sided with the company in response to an anti-DEI proposal challenge. The SEC’s decision allowed the pharmaceutical giant to remove the proposal from its proxy statement.
Some companies have taken other steps on their own to scale back DEI programs or change DEI language in annual reports.
Last year, it said its businesses had hiring practices “intended to identify qualified candidates and promote diversity and inclusion in the workforce.” This year, it left out the phrase “promote diversity and inclusion in the workforce.”
Berkshire Hathaway CEO Warren Buffett. (AP Photo/Nati Harnik, File) ·ASSOCIATED PRESS
The nation’s largest bank, JPMorgan Chase (JPM), said in March that it would reduce diversity-oriented training and swap the word “equity” for “opportunity” in its internal organization known as “diversity, equity & inclusion.
Disney (DIS) also cut one of its diversity-focused programs called “Reimagine Tomorrow” and removed references to two DEI programs in its annual report prior to its annual shareholder meeting.
The legal and political pressure on companies to dial back DEI language and policies has intensified during the new Trump administration.
In March, the Equal Employment Opportunity Commission (EEOC) warned that certain DEI-related employer practices may be illegal under Title VII of the Civil Rights Act of 1964, a federal law that outlaws employment discrimination based on race, color, religion, or sex.
The US Justice Department joined the EEOC, saying employees should file charges if they believe they’ve been subjected to DEI-related discrimination.
Some companies have actively encouraged their shareholders not to support anti-DEI measures. Costco (COS) did so in response to a shareholder initiative that pushed to require more disclosures on the company’s diversity practices.
The giant retailer urged its stockholders to defeat a resolution from the National Center for Public Policy Research (NCPPR), a conservative think tank, that would have forced it to evaluate risks from its DEI practices.
The measure was roundly defeated, with 98% of investors siding with the company.
Alexis Keenan is a legal reporter for Yahoo Finance. Follow Alexis on X @alexiskweed.
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