Automakers retreat further from corporate DEI policies

After George Floyd’s murder in 2020, companies rushed to embrace diversity, equity, and inclusion (DEI) efforts—pitching them as both a moral duty and a business advantage. But the tide is shifting.

Driving the news: With President Trump back in the White House, scrutiny is rising from conservative activists. And as a result, some major companies—including global automakers—are pulling back.

What's changing: Ford was one of the first to rethink its DEI approach last fall.

• A leaked memo revealed the company is taking a "fresh look" at its policies, citing the “external and legal environment related to political and social issues.”

• The review mentions leaving the Human Rights Campaign’s (HRC) Corporate Equality Index.

• And Ford CEO Jim Farley said the company will focus on fostering “an environment where all of us can do our best work, anchored in respect and inclusion.”

Similar moves: According to Bloomberg, Toyota told U.S. employees it would “narrow community activities to align with STEM education and workforce readiness.”

• The company will stop taking part in LGBTQ+ measurements. This includes the HRC’s Corporate Equality Index.

• Nissan is also walking things back. Jeremie Papin, the outgoing chairman of Nissan Americas, told employees the company will no longer engage with groups “heavily focused on political activism” and will instead align employee training with business priorities.

• Nissan confirmed the shift after conservative activist Robby Starbuck shared the letter on X.

Not alone: Many companies—including Walmart, Lowe’s, Meta, McDonald’s, and Harley-Davidson—are also rethinking DEI.

Yes, but there's a lot less talk about DEI too. Mentions of DEI on corporate earnings calls have plummeted 82% since 2021. And even the Society for Human Resource Management (SHRM) removed “equity” from its strategy. Instead—companies are swapping terms like “DEI” for softer phrases like “belonging” and “diversity of thought.”

Zooming in: Some businesses have framed these moves as a response to the Supreme Court’s 2023 ruling against affirmative action. But legal experts say that’s more of a convenient excuse than a real concern.

The bigger driver? Likely the political climate.

Follow the money: For years, DEI advocates have said that diversity in hiring and leadership leads to better financial results. But researchers have mixed findings.

• A Harvard professor called many industry-backed DEI studies “marketing materials crafted to attract paying clients,” criticizing them for weak methodologies and misinterpreting correlation as causation.

• And rigorous academic research suggests that increasing racial or gender diversity does not guarantee an improvement in profits.

But that doesn’t mean all DEI efforts are pointless. Alex Edmans, a finance professor at London Business School, told Bloomberg that while hiring quotas don’t guarantee business success, companies that create a genuine sense of inclusion for employees—regardless of background—tend to perform better.

Big picture: Corporate DEI efforts aren’t disappearing entirely, but they’re definitely evolving. Companies are stepping back, reframing the conversation, or shifting their priorities under less politically charged language. Whether this is a short-term change or a permanent retreat remains to be seen, but so far—a line in the sand has been drawn.

Become an automotive insider in just 5 minutes.

Get the weekly email that delivers transparent insights into the car market.

Join 90,000+ others now, it's free:

In today's automotive landscape, car buyers invest more time than ever in researching, considering, and comparing options. But for dealers, the challenge lies in pinpointing the audience ready to make a purchase.

Enter Premier by Edmunds.

Premier offers dealers a groundbreaking way to connect with in-market car shoppers precisely when, where, and how they prefer. With over 20 million monthly visits, Edmunds.com is the go-to destination for buyers seeking market insights, expert advice, and budget tools to make informed decisions.

Through Edmunds Premier, dealers gain access to this highly coveted audience. Simply list your new and used inventory on Edmunds, and watch as qualified, in-market traffic flows directly to your vehicle detail pages on your website.

Don't miss out on this opportunity to elevate your dealership's visibility and sales performance. You can sign up for Premier today at Edmunds.com/CDG.