Costco Defends DEI Program as Shareholders Prepare to Vote on Its Future

The company's board urges shareholders to reject a proposal to evaluate risks of its diversity efforts, as other corporations scale back similar initiatives.

Costco's Board of Directors has unanimously recommended shareholders vote against a proposal to assess the risks of its diversity, equity, and inclusion (DEI) program at the January 23 annual meeting.
The proposal, introduced by the conservative National Center for Public Policy Research, argues that DEI initiatives pose legal, financial, and reputational risks, citing recent lawsuits and a Supreme Court ruling on race-based policies.
Costco has rebranded its DEI program as 'People and Communities' but maintains its commitment to diversity, including hiring practices, supplier diversity, and a Chief Diversity Officer role.
The board defends DEI as essential to fostering innovation, attracting talent, and reflecting its diverse customer base, stating the policies comply with legal standards.
The outcome of the shareholder vote could signal broader trends in corporate America's approach to DEI as many companies, including Walmart and John Deere, have scaled back similar efforts recently.