America's largest companies hired more Black executives. Then came the DEI backlash.
One month after George Floyd’s murder, the U.S. Chamber of Commerce launched a national initiative to address America's deep racial divides. The message: “Equality of opportunity” is everybody’s business.
“We fundamentally believe that all Americans should have the opportunity to earn their success, rise on their own merits and live the American dream. But we know today that is not the case,” then-CEO Tom Donohue told attendees at a town hall in June 2020, calling on them to raze barriers for Black Americans and other people of color.
But shortly before President Donald Trump took office in January, the high-profile campaign vanished. The webpage touting the Equality of Opportunity Initiative now redirects to the Chamber of Commerce’s home page.
The retreat by the nation’s powerful business lobby shows how dramatically corporate America has shifted in less than five years, said Daniel Kinderman, a political science professor at the University of Delaware who studied the initiative.
As the Trump administration moves to dismantle corporate diversity, equity and inclusion initiatives in the private sector, the Chamber of Commerce and companies across America are accelerating efforts to jettison DEI programs that could put them in the president's crosshairs.
The rollbacks are having a direct impact on the careers of Black Americans and the diversity of executive suites inside the largest companies, a new Paste BN analysis shows.
With the nation in the throes of a historic racial reckoning, the number of Black executives rose by nearly 27% in S&P 100 companies between 2020 and 2022, according to workforce demographics compiled by the federal government and provided to Paste BN by research firm DiversIQ.
Energized by the 2023 Supreme Court ruling ending race-conscious college admissions, conservative groups led by Stephen Miller, now White House deputy chief of staff for policy, and anti-affirmative action activist Edward Blum targeted corporate “wokeism” at nearly four dozen companies from Apple to Pizza Hut-owner Yum! Brands.
That same year, the ranks of Black executives fell 3% from the prior year – twice the rate of white executives.
Data for 2024 is not yet available.
A key factor in that decline was the loss of diversity commitments that benefit all employees by ensuring that everyone has an equal shot at success, diversity advocates say.
“When companies make their decision-making processes in hiring and promotions more fair, when they focus on building more meritocratic processes and when they invest in creating more healthy and inclusive cultures that work for everyone, we see them start to close the types of gaps that disproportionately impact underrepresented groups,” said Joelle Emerson, co-founder and CEO of Paradigm Strategy. “If they stop doing those things, they are going to backslide.”
White execs outnumber Black leaders 12 to 1
For decades, America’s largest corporations have hired Black Americans but mostly in roles with lower pay and less power, according to diversity researchers and Paste BN's analysis of data publicly traded companies submit to the Equal Employment and Opportunity Commission.
Even with recent gains, Black Americans are still outnumbered 12 to 1 by white people in executive roles – a gap seven times wider than found in the overall workforce at those companies.
In 2020, Black men held 2.8% of executive jobs and Black women held 2%. By 2023, the figures rose less than a point to 3.2% and 2.5% respectively. The ground gained among managers was even smaller for both groups.
The blitz of diversity initiatives after Floyd's murder did little to change the demographics at the top of corporations. White men still hold almost half of all executive jobs. White women hold another quarter.
“It’s not as though the progress that was made was so extraordinary that the entire leadership across corporate America had been radically transformed into some rainbow coalition of leaders,” said David Glasgow, executive director of the Meltzer Center for Diversity, Inclusion and Belonging at the NYU School of Law. “It was an incremental shift away from a total dominance of white men toward a continued disproportionate representation of white men.”
Trump claims 'DEI hires' taking white jobs
That’s not the way DEI critics like Trump see it. They say “DEI hires” are getting jobs and promotions at the expense of more qualified and deserving candidates.
On the campaign trail, Trump pledged to “terminate” DEI. Even before he took office, companies scaled back diversity initiatives to align themselves with his administration.
In his first days in office, Trump ordered an end to DEI in federal agencies and federal contracting. The president also directed federal agencies to identify the “most egregious and discriminatory DEI practitioners” in the private sector and recommend up to nine targets for investigation. Hours after taking office, Attorney General Pam Bondi pledged to prosecute offenders.
"My administration has taken action to abolish all discriminatory diversity, equity and inclusion nonsense," Trump said at the World Economic Forum last month. "These are policies that were absolute nonsense throughout the government and the private sector."
Trump escalated his campaign Wednesday, pressuring Apple to end its diversity hiring practices, one day after investors rejected an anti-DEI shareholder proposal from a conservative think tank.
“APPLE SHOULD GET RID OF DEI RULES, NOT JUST MAKE ADJUSTMENTS TO THEM,” the president wrote on his social media platform Truth Social.
CEO Tim Cook said Apple did not use hiring quotas or targets but may make some adjustments.
National civil rights leaders and Democratic congressional leaders are joining forces to fight the Trump administration on DEI.
“House Democrats believe in merit for everyone, based on what you know, not who you know. That’s what diversity, equity and inclusion helps to promote," House Democratic Leader Hakeem Jeffries said in a statement Wednesday.
DEI backlash factor in Black executive losses
The administration's actions set off a wave of fear in the business world as corporate leaders scrutinized diversity programs to reduce their exposure.
Today these leaders fall into two camps: Duck or double down, said Barry Lawson Williams, a Black businessman and the retired managing general partner of the Williams Pacific Ventures investment and consulting company.
“The duck contingent says: ‘Let’s wait until this blows over. Let’s not make ourselves an unnecessary target. We are going to do what’s best for our companies but we are going to be quiet for now.’ The double down group says: ‘If the only voice heard is this current anti-DEI voice, that will become the prevailing thought and, in fact, it might embolden those people to do even more,’” said Williams who has served on more than a dozen public company boards.
The reckoning has an upside. Corporations may be better off without some DEI programs rushed into existence in 2020 and 2021, according to diversity advocates. Some were ineffective, such as unconscious bias training. Others were legally risky, such as public pledges to fill leadership roles with women and people of color.
But Williams worries the race to unravel diversity programs will mean qualified candidates won't get elevated and more Black executives will leave big corporations to seek their fortunes elsewhere, risking decades of hard-fought gains for Black Americans in the workplace.
“There has to be strong encouragement to stay and perform in those positions or there will continue to be that dropoff,” he said.
1 in 4 firms saw Black executive declines
Almost a quarter of S&P 100 companies reviewed by Paste BN saw the number of Black executives decline between 2020 and 2023.
Some declines were part of broader cuts to executive positions. For instance, AT&T cut almost half of its executive jobs, but the decline was steeper for Black leaders.
Similarly, FedEx Corp. cut executive jobs by 15% but the number of Black executives fell at more than twice that rate, from 112 to 76 people.
Other losses happened even as companies expanded their executive ranks. The Kraft Heinz Co. doubled the number of executives between 2020 and 2023 yet the number of Black executives dropped from two people to one.
At Qualcomm, the number of executives changed little in that timeframe, but the number of Black executives fell from 5 people to 2, or 1.6% to 0.6%.
Diversity advocates say the sudden attrition is troubling, especially in light of the sparse gains made in that period.
Of the 82 companies in the S&P 100 that released their demographic information, six had only one Black executive in 2023: Mondelēz International, The Kraft Heinz Co., The Bank of New York Mellon Corp., Advanced Micro Devices, Booking Holdings and Costco Wholesale Corp.
One company – Broadcom – had no Black executives between 2020 and 2023.
The lack of Black leadership stands in stark contrast to the rest of the workers at S&P 100 companies. About 19% of the workforce is Black, almost twice the rate of the overall U.S. workforce.