Costco Board Stands Up to MAGA’s Anti-DEI Bullies
The wholesale giant urges shareholders to reject a right-wing proposal aimed at forcing the company to dump its pro-diversity efforts.
Costco is facing threats of a boycott from social conservatives after the company refused to drop its diversity, equity and inclusion initiatives.
The board of directors for the company, the third-largest retailer after Walmart and Amazon, unanimously recommended that its shareholders vote against a proposal from a conservative think tank, the National Center for Public Policy Research, that would require the wholesale giant to evaluate and issue a report on the financial risks of maintaining its diversity and inclusion goals.
Shareholders are expected to vote on the NCPPR’s proposal at their annual meeting on January 23.
NCPPR has argued that DEI initiatives — and Costco’s specifically — are a form of “illegal discrimination” against employees who are “white, Asian, male or straight,” reports CNN.
The right-wing organization argues that those wronged by such discrimination would then pursue legal actions against the company, potentially costing Costco “tens of billions of dollars.”
Costco currently has a chief diversity officer and a supplier program that focuses on partnering with small and diverse businesses. It also donates to organizations like the Thurgood Marshall College Fund, which provides scholarships for students attending public historically Black colleges and universities.
In a proxy statement to investors, the board stood by its DEI programming, urging shareholders to defeat the proposal.
“Our success at Costco Wholesale has been built on service to our critical stakeholders: employees, members, and suppliers,” the statement reads. “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.”
Costco claims that its DEI efforts are not only legal but also help attract and retain a wide range of employees and customers.
“Among other things, a diverse group of employees helps bring originality and creativity to our merchandise offerings, promoting the ‘treasure hunt’ that our customers value,” Costco said in its statement. “We believe (and member feedback shows) that many of our members like to see themselves reflected in the people in our warehouses with whom they interact.”
It also defended its efforts to partner with minority-owned businesses.
“Having diversity in our supplier base, including attention to small businesses, is beneficial for many of the same reasons diversity benefits our Company,” the statement continues. “We believe that it fosters creativity and innovation in the merchandise and services that we offer our members.”
Costco’s board of directors went further, accusing the NCPPR of attempting to conceal its anti-diversity agenda by claiming to be reducing “risk.”
“The proponent professes concern about legal and financial risks to the company and its shareholders associated with the diversity initiatives,” Costco said. “The supporting statement demonstrates that it is the proponent and others that are responsible for inflicting burdens on companies with their challenges to longstanding diversity programs. The proponent’s broader agenda is not reducing risk for the company but abolition of diversity initiatives.”
As reported by Forbes magazine, proponents of anti-DEI initiatives argue that lawsuits stemming from perceived discrimination threaten companies’ bottom lines. They point to court cases, such as Students for Fair Admissions v. Harvard and Fisher v. University of Texas, which have found that race-based admission policies violate the Constitution’s guarantee of equal protection, as justification for their opposition to DEI programs.
In its proposal, NCPPR cited a $25.6 million judgment against Starbucks, in which a federal court found that race discrimination played a part in the firing of a white former regional manager for the coffee giant.
It also notes that the ongoing conservative backlash against pro-diversity efforts could potentially harm the reputations of companies with DEI programs, leading some companies to rebrand their DEI programs and choosing not to publicly advertise them, in order to avoid scrutiny.
“It’s clear that DEI holds litigation, reputational and financial risks to the company, and therefore financial risks,” NCPPR said in its proposal. “And yet Costco still has such a program, though it was apprehensive enough to recognize this as it recently and quietly rebranded its DEI program to ‘People and Communities.'”
In response to threats of boycotts, several high-profile corporations have rolled back or eliminated their DEI policies or programs in recent months, including Walmart, Stanley Black & Decker, Molson Coors, Ford Motor Company, Lowe’s Hardware, and Harley-Davidson.
According to an analysis by Bloomberg last year, more than two dozen public companies mentioned DEI as a “risk factor” in their security filings.
Robby Starbuck, a MAGA radical pushing for the elimination of corporate DEI policies, called for a boycott of Costco in response to its refusal to drop DEI initiatives.
“For now, I suggest conservative consumers find other places to spend their money if Costco is so dedicated to doubling down on DEI. If they’re smart, Costco will do right by their shareholders and change before we turn our attention to them,” he threatened on X.
Several X users applauded the company for refusing to back down in the face of pressure and threats from conservatives.
“Costco has refused to get rid of their DEI programs despite right-wing protests demanding they do,” wrote user @timfullerton. “Studies have showed that companies with strong DEI policies drive more revenue. This makes me want to shop at Costco more than ever.”
“I did not see that coming. While other companies are kowtowing to the anti-DEI bullies, @Costco decided to show everyone how adults deal with bullying,” wrote a user named @dereklwalker.
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