When Yulkendy Valdez founded her DEI consulting agency in 2017, she had an ambitious goal: help increase Black and Latinx representation within Fortune 500 leadership roles to 30% by 2030. At the time, only 7.9% of board seats at Fortune 500 companies were occupied by Black executives, while 3.5% were occupied by Latinx executives, and 3.1% were Asian executives. 

Corporate gains in diversity have been minuscule since. According to the most recent annual study by the Alliance for Board Diversity and Deloitte, a global professional services firm, today, Black executives make up 11.9% of boardroom members, compared to 4.7% who are Latinx and 5.4% who are Asian/Pacific Islander.

“We’re seeing some small wins of marginalized folks taking on board seats, leadership positions, but broadly that face of leadership in corporate America hasn’t changed at all,” Valdez said. “And I think that speaks volumes of where we still are with the DEI efforts.” 

Workplace diversity and equity initiatives struggle to make meaningful strides, and the rise of conservative campaigns against initiatives that bolster diversity now further threatens those efforts. Most recently, the Supreme Court rolled back affirmative action in college admissions in June. Some DEI experts are seeing a sea change in how companies approach diversity and equity following the court’s ruling that could have a lasting impact that reaches beyond academia. 

“A couple of years ago, there was real fervor behind ‘we need to have spaces for those most marginalized’… [Now] I’m hearing more of ‘how do we make sure everybody can attend?’” said Nani Vishwanath, a consultant with DEI training firm The Courage Collective. 

In the aftermath of Minneapolis police murdering George Floyd, which propelled the Black Lives Matter movement into a national campaign for social change through anti-racist equity efforts, private businesses were suddenly investing heavily in diversity initiatives. A 2023 McKinsey report found that an estimated $340 billion was dedicated toward racial equity commitments by U.S. corporations between May 2020 and October 2022. Beyond that, companies were also keen on making DEI an integral focus within their ranks, with LinkedIn reporting a 168.9% jump in postings for chief diversity and inclusion officer roles between 2019 and 2022. 

But by the end of 2022, public interest in pursuing racial equity began to wane, and so did the companies’ DEI commitments. The new diversity and inclusion officer roles that were heralded as beacons of renewed progress were among the first to go as companies slashed payrolls amid the pandemic. Meanwhile, a nationwide campaign led by right-wing activists and lawmakers began targeting diversity efforts in every form, with some states passing bans against DEI offices. Following the Supreme Court decision on affirmative action, attorneys general from 13 Republican-controlled states sent an open letter to the CEOs of Fortune 100 companies warning executives that the highest court’s decision regarding race-based college admissions considerations could apply to private companies’ diversity initiatives, too. 

In August, the American Alliance for Equal Rights—a group led by right-wing activist Edward Blum, the same man who led the student group that brought the affirmative action case to the Supreme Court—sued two separate law firms over diversity fellowship programs meant to support first and second-year law students from historically marginalized backgrounds. The group sued a third law firm over its diversity fellowship in October. The two August suits were dropped after both firms changed the terms of the fellowships to allow all students to apply. The legal field remains one of the least diverse workforces in the U.S., with Black lawyers making up less than 5% of practicing attorneys, while Latinx and Asian lawyers make up about another 11% of active lawyers, and Native Americans make up only 0.5%, according to the American Bar Association.

A lack of conviction in diversity and equity values from a company makes it easier for diversity initiatives to be undercut in times of social unrest, which hinders meaningful progress, Vishwanath said. 

“When that clear ‘why this is important to the organization’ isn’t known or felt or really entrenched in the business, then the external things will continue to rattle us around in a way that feels disingenuous and unstable, and the commitment can feel less clear,” she said. 

In addition to making it more difficult to advance progress, attacks on DEI initiatives can have a chilling effect on potential funding opportunities for endeavors meant to bolster diversity. Valdez pointed to the lawsuit against the Fearless Fund, a venture capital fund geared toward supporting businesses founded by women of color. Such businesses received only 0.39% of the $288 billion in total VC funding distributed in 2022, according to the organization. Blum’s group sued the fund over its $20,000 grant program for Black women entrepreneurs in August, and by October, Atlanta’s Court of Appeals ruled to temporarily block the fund from operating the grant program.

“Now that that’s happening and out there, it has made it easy for corporate leaders to say, ‘I don’t want anything to do with that because I’m scared that I also might get sued, I might be in trouble for supporting initiatives like this one,’ and so that has slowed down,” said Valdez, who works with a variety of clients, including nonprofits. “A lot of nonprofits have more trouble raising sponsorship or getting investment if they’re DEI related.”

The Fearless Fund’s grant program, funded by MasterCard as part of a five-year pledge to provide funding for Black founders in 2020, was reportedly at risk of shuttering before the lawsuit due to MasterCard’s plans to cut the initiative’s funding as it was “no longer passionate about the original cause.”

In a deeper cultural sense, campaigns that undermine the value of diversity and equity in the workplace can be harmful to BIPOC workers because they reinforce the idea that BIPOC can only achieve success or advance in the workplace as part of a diversity quota fulfillment instead of due to their talent and skills.

“I think that [the Supreme Court] decision and the recent dialogue around affirmative action just leads to more bias and folks of color feeling like they don’t belong in these spaces,” said Valdez, referring to the sense of imposter syndrome that is commonly experienced among BIPOC, particularly women of color. 

Despite the political campaigns against diversity and equity efforts, research shows that embracing diversity leads to myriad benefits for companies, from fostering more innovation among staff to securing greater employee retention. Most notably, diversity is good for business: a 2020 McKinsey report found the top 25% of companies with higher gender diversity were 25% more likely to show above-average profitability than those in the lowest quartile, and the top 25% of companies with ethnic and cultural diversity outperformed the lowest quartile by 36%.

Underlining that DEI not only benefits its people, but helps the company’s bottom line as well is one approach Vishwanath and her team have applied to secure a stronger buy-in commitment from clients.  

“We often talk to organizations about the many ways that people move through the world and how we need to have nuanced approaches to support them, both employees and customers. [It’s] good for people, obviously. But it’s also good for profit,” she said. “And I think we need to be really clear about that.”