Good morning. If you search for "DEI"—diversity, equity, and inclusion—on social media sites like LinkedIn, you'll find no shortage of posts offering intense praise or criticism of the practice in the workplace. DEI has also permeated the political arena, leading some companies to abandon it and others to double down. While there is plenty of noisy debate, the business case for DEI has been the focus of studies for years—and the research continues to point to the business benefits.
Farm equipment maker John Deere is one of the latest companies to distance itself from DEI efforts. The company posted on X on July 16 that it would no longer “participate in or support external social or cultural awareness parades, festivals or events,” and will “ensure the absence of socially-motivated messages” in compliance with federal and local laws. The company added that “the existence of diversity quotas and pronoun identification have never been and are not company policy.” John Deere also ended an array of its corporate diversity and climate efforts.
Meanwhile, JPMorgan Chase CEO Jamie Dimon affirmed the bank isn’t retreating from its diversity efforts despite the “ridiculous ESG, DEI groups coming at us,” he said in January at an event hosted by the Female Quotient at the World Economic Forum, Fortune’s Ruth Umoh reported. “I’m going to start by telling you that I’m a full-throated, red-blooded, patriotic, unwoke, capitalist CEO,” Dimon said.
During the discussion, Dimon acknowledged the Supreme Court’s revocation of affirmative action, stating, “They spoke, we’ll salute, we’re going to follow the law," he said. The firm plans to remain compliant, otherwise, little will change in regard to DEI programs. JPMorgan Chase is No. 12 in the Fortune 500.
Major organizations are also weighing in. Fortune’s Emma Burleigh recently reported in CHRO Daily that the Society of Human Resource Management (SHRM), the world’s largest human resources group, announced that it would be dropping “Equity” from its approach to “Inclusion, Equity and Diversity.” SHRM wrote in a LinkedIn post on July 9: “By emphasizing Inclusion-first, we aim to address the current shortcomings of DE&I programs, which have led to societal backlash and increasing polarization.” Burleigh noted the reaction from many HR practitioners was “swift and furious.”
But as some grapple with whether dropping the “E” in DEI will make it more acceptable, there are many business leaders who still see the practice as essential. A report by Workday (a CFO Daily sponsor) released in February is based on a survey of 2,600 global business leaders, such as CEOs and leaders from HR, finance, IT, and sales. Seventy-eight percent say the importance of DEI increased in the past 12 months, with 85% stating they have a budget for DEI initiatives—an increase of 11% compared to last year’s survey. Some of the top reasons for supporting DEI: positively impacting business success and results (39%); improved employee engagement (40%); staff well-being (41%); and attracting and recruiting a diverse workforce (43%).
Regarding consumers, 75% say that diversity and inclusion—or a lack thereof—influence their purchase decisions, according to a July 16 report by Kantar, a London-based marketing data and analytics firm. Kantar’s Brand Inclusion Index 2024, released this month, is based on a survey of more than 23,000 people in 18 countries. And inclusion is what many employees want.
I remember meeting Siemens Energy’s Maria Ferraro back in 2021. Ferraro holds two C-suite positions at the technology company that she believes are intertwined—CFO and chief inclusion and diversity officer. In her CFO role, Ferraro can provide “tangibility” of the fact that inclusion and diversity are fundamental for sustainable value creation, she told me.
Sheryl Estrada
sheryl.estrada@fortune.com
The following sections of CFO Daily were curated by Greg McKenna.
