No, the culture wars aren't over. DEI is just getting a facelift.

Goodbye, "diversity and equity" — hello, “belonging and unity." In other words, don't be fooled.

Just a few months ago, we told you how corporations were seemingly abandoning Environmental, Social, and Governance (ESG) rules, amidst claims that "woke capitalism" would lead to negative shareholder returns.

The Wall Street Journal reported that BlackRock’s Larry Fink purged the letters from his vocabulary, even though he was once the biggest crusader for the cause: 

He attempted to use BlackRock’s clout as the steward for millions of investors to prod companies toward climate-friendly policies and press them to disclose the social effects of their businesses. He long argued that the world’s largest asset manager and its peers could make money and make the world a better place at the same time.

The sly subtext, however, is that ESG is not going away. It’s just getting renamed with terms like “transition investing” and “responsible business”. A rebranding really, to use corporate marketing parlance.

So if you suddenly start hearing that ‘Diversity, Equity, and Inclusion’ is dead, do us a favor and look for the similar subtext.

DEI isn’t over — not by a long shot.

A recent article in the Washington Post reports that “a growing number of companies — including language app Duolingo, JetBlue and Molson Coors — are either listing DEI as a ‘risk factor’ in shareholder reports or removing mentions of diversity goals outright.”

A Bloomberg Law analysis found that two dozen public companies have incorporated similar risk-factor language into their filings. And several companies, including Kohls, Salesforce and Workday, have dropped references to diversity goals in regulatory filings, the Wall Street Journal reported.

Conservatives may celebrate this as a win for their side in the culture wars, but that would be naive, at best. The proper analysis is that this is a strategic retreat and the war is far from won.

While corporations are making adjustments on ESG to avoid financial losses, they’re shifting their weight on DEI to avoid the risk of being sued for reverse discrimination. That doesn’t mean they’ve changed heart or suddenly believe in meritocracy. It just means they’re making their supposed anti-discrimination efforts more superficially “identity-neutral” to ensure they are lawful.

Here’s an example: one plank in the DEI platform is for companies to create “workplace affinity groups” or “employee resource groups”. The idea is that employees can voluntarily opt-in to a group exclusively based on factors like gender, ethnicity, or sexual identity, and that group will help promote the company's inclusion and diversity goals by serving as an avenue for networking, learning, support and mentorship. 

In practice, however, these groups can become divisive and exclusionary and their creation comes with legal risks if they are not structured and managed correctly. “Just because the goal of the affinity group is laudable does not mean that the group is lawful,” warned the Society for Human Resource Management in an article on affinity group “danger zones.”

To avoid these pitfalls, companies are now making workplace affinity groups open to all. Sure, that may make them more lawful, but does it mean woke is winding down? Probably not. Would a straight, Christian white male really be welcome in a LGBTQIA+ group that’s open to all employees? It’s anyone’s guess, however it may look something like this:

Just as with the language shift on ESG, the words around DEI are changing too, with more emphasis being placed on “inclusion,” and with “diversity and equity” morphing to milder words like “belonging and unity.”

To be fair, any structural discrimination that limits people’s opportunity to compete on merit should be challenged. But poorly implemented policies that prioritize identity over merit, practice reverse discrimination, and bend over backwards to accommodate people based on identity characteristics just complicate issues of fairness rather than solve them.

And so, beware the softer, gentler version of DEI that is emerging, particularly here in the US during this election year, when candidates are looking to manipulate and weaponize hearts and minds in the never-ending quest for power.

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