Costco's Board Of Directors Requests For Shareholders To Vote Against A Policy That Would Remove Its DEI Program

Costco is doubling down on its decision to maintain its DEI policies.

This comes amid several major companies retracting their commitments, such as Google. CNBC reported that Google had established new programs to empower Black staffers following the murder of George Floyd in 2020. At the time, its CEO, Sundar Pichai, stated the intention “to build sustainable equity for Google’s Black+ community, and externally, to make our products and programs helpful in the moments that matter most to Black users.” The company aimed for a benchmark of 30% of leadership being composed of underrepresented groups by 2025.

However, in the years since, Google has fallen significantly short of that goal by reducing staff and shrinking programs related to diversity, equity, and inclusion (DEI), as has its parent company Alphabet.

By mid-2023, DEI job postings by companies in general were showing a downward trend. Job site Indeed offered data that revealed a drop of 44% in postings compared to the previous year, per CNBC. By November 2023, those DEI roles had decreased 23% since November 2022.

Other companies that have reduced DEI roles or commitments include Meta, Microsoft, and Zoom, according to Fox Business. Costco, however, has taken an active stance to diverge from this trend. Its board of directors has urged shareholders to vote against a proposal introduced by the National Center for Public Policy Research to eliminate its DEI program.

“Our success at Costco Wholesale has been built on service to our critical stakeholders: employees, members, and suppliers. Our efforts around diversity, equity and inclusion follow our code of ethics: For our employees, these efforts are built around inclusion – having all of our employees feel valued and respected,” the board of directors wrote in a message, according to Fox Business. “Our efforts at diversity, equity and inclusion remind and reinforce with everyone at our Company the importance of creating opportunities for all. We believe that these efforts enhance our capacity to attract and retain employees who will help our business succeed. This capacity is critical because we owe our success to our now over 300,000 employees around the globe.”

According to the proposal, Costco’s DEI program has been renamed and exists under a new title, “People and Communities” which maintains a “commitment to equity.” Costco continues to employ a chief diversity officer; considers race and gender in hiring, promotions, and selecting its suppliers; and supports organizations “that advance the discriminatory agenda of DEI.” 

While the National Center for Public Policy Research alleges the DEI program is no longer legal since the Supreme Court’s ruling on affirmative action in June 2023, Costco’s board has pushed back with its own concerns. The board claims that the foundation is participating in “shareholder activism” with a broader agenda of “abolishing diversity initiatives,” and its study of Costco’s DEI policy “reflects a policy bias,” according to Fox Business.

“We welcome members from all walks of life and backgrounds,” Costco’s board wrote, per the outlet. “As our membership diversifies, we believe that serving it with a diverse group of employees enhances satisfaction. Having diversity in our supplier base, including appropriate attention to small businesses, is beneficial for many of the same reasons diversity benefits our Company. We believe that it fosters creativity and innovation in the merchandise and services that we offer our members.”