Redefining DEI—how to frame diversity as a business imperative

One of the most prevalent trends from 2024 has escalated in the new year. In the face of a tidal wave of criticism of diversity, equity and inclusion initiatives, many companies have reversed established policies to avoid public scrutiny. As the proud son of immigrant parents from Cuba and Mexico, I believe in championing diversity in all facets of society, including the business landscape. However, I also understand reasonable people can disagree on complex topics and that a new approach is direly needed. A few social media activists are leading a pressure campaign against publicly traded companies that champion diversity programs, causing shifts from companies including Ford, Harley-Davidson, John Deere, Lowe’s, McDonald’s and Toyota. Perhaps the most significant retreat came from Walmart, America’s largest private employer, which recently announced a reversal of programs focused on LGBTQ, climate change and other societal issues. The tipping point for this movement may have been Bud Light’s now infamous 2023 partnership with transgender influencer Dylan Mulvaney, which sparked a months-long boycott, dethroned America’s best-selling beer and caused a $1.4 billion drop in sales, according to the company. Ad Age Tech Power List 2025 We’re looking for top digital innovators from agencies, brands, platforms, ad tech companies and tech startups Enter here These reversals are actually cyclical. It was only four years ago during the pandemic when DEI initiatives grew exponentially, ignited by racial justice protests and COVID-caused inequities. According to McKinsey & Co., large enterprises spent an estimated $7.5 billion on DEI-related efforts. In this unpredictable see-saw, it’s natural to wonder what the right balance is and whether we’ll ever emerge from this quagmire. I’m reminded of the old joke about a pessimist who laments; “Things really can’t get any worse.” To which his optimist friend replies, “Oh, yes it can!” Both sides of the debate are fixated on terms that spark rancor. Rather than fall prey to trigger words and acronyms, perhaps there’s a better way forward. Our path to collective success should be rooted in narrowing the discussion to areas of common ground. Take “global warming,” another polarizing term that elicits venom from entrenched groups. In my hometown of Miami, there is disagreement about the cause of climate change (and whether it even exists), but our community found common ground by reframing the issue around undeniable facts. Regardless of whether you believe in global warming, there is no question that we are enduring “sea level rise.” This newer term has brought together liberals, conservatives, scientists, business leaders and politicians whose common pursuit is reinforcing our diminished sea wall to prevent coastal flooding and ensure the future of waterfront real estate. The key component was narrowing this issue to a smaller, shared goal while focusing less on blame for how we got here in the first place. Two decades ago, celebrated Harvard Business School Professors Michael E. Porter and Mark Kramer coined the term “creating shared value.” The premise was that corporate social responsibility should deliver mutual benefit for a company as well as society. The more a business combines altruism with profitable strategies, the less criticism it might receive. As it pertains to diversity, such mutual interests could include unlocking greater economic value for companies, employees and shareholders. Like it or not, DEI initiatives have statistically proven to reduce employee attrition and increase employee motivation and innovation, according to Boston Consulting Group, which surveyed more than 27,000 employees in 16 countries. To strike the right balance, brands and their consultants would be wise to heed five guiding principles: Reframe as a business imperative Rather than a charitable box to check, companies should frame the issue as a competitive advantage and a critical piece of a winning strategy. Embrace demographic change Capitulating to external threats is tempting but will ultimately prove shortsighted. There is no question the future demographics of America are changing and growing more diverse. Gen Z is 51% non-white and 25% Hispanic. Shareholders ignore these trends at their peril. NextGen Marketing Summit Join us for a crash course on Gen Z, DTC marketing and the creator economy Register today Focus on results Rather than extolling a company’s virtue with sweeping public announcements, organizations should operate in stealth mode and do the work of diversifying their customer base, employee makeup and future-proofing their brand. Be authentic Not all diversity initiatives are created equal. Although the fundamental goals are similar, every company should adhere to its values, unique selling proposition and brand identity. Irrespective of where you sit on LGBTQ issues, does anyone think the Bud Light campaign was consistent with four decades of its marketing? Which one of these things doesn’t belong: Clydesdales, talking frogs, the Super Bowl and … transgender influencers? My point is that companies can and should lean into societal issues, but not by pivoting quickly toward inauthentic directions and forgetting what they worked hard to represent for millions of customers. Nuanced delivery Having to choose between a consistent brand and a diverse organization is a false choice. Companies should preserve one cohesive set of values but amplify them with nuanced internal and external campaigns that resonate culturally for distinct target audiences. In the words of the iconic “Mad Men” character Don Draper, “If you don’t like what’s being said, change the conversation.” It’s time we realize that words matter and begin reframing DEI around common goals that benefit society as well as the bottom line. Gen Z Career Forum Get practical advice on launching your career and excelling in the industry Register today

Redefining DEI—how to frame diversity as a business imperative

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