Despite the conservative push to end diversity, equity, and inclusion (DEI) initiatives in corporate America, new research shows that companies that did not heed the “go woke, go broke” warning are flourishing.
A study conducted by Jacob Grumbach, an associate professor at the University of California, Berkeley’s Goldman School of Public Policy, found that S&P 500 companies that maintained their DEI commitments after President Donald Trump passed anti-DEI executive orders last year performed just as well financially as companies that scaled back their programs.
In the days immediately following the orders, companies that retained their DEI policies actually outperformed those that did not, according to the analysis, The Guardian reports.Companies, including Target, Google, Goldman Sachs, McDonald’s, and Walmart announced changes to their DEI policies, while companies such as Costco, Apple, and Delta Air Lines continued to defend or maintain key diversity initiatives. Grumbach examined what economists call “abnormal returns,” comparing a stock’s expected performance with its actual performance to isolate the market impact of corporate decisions around DEI. The results show that the corporations that remained firm on their stance on DEI did not take a hit to their bottom line.
Still, the corporate retreat from DEI has not always been as clear-cut as headlines suggest. David Glasgow, the executive director of New York University’s Meltzer Center for Diversity, Inclusion and Belonging, said many companies are operating in what he called a “messy middle.”
“Often what’s going on is something more in the messy middle, where they’re sticking with some things, deleting others and then reframing or rebranding some,” Glasgow said.
“No matter how we measure DEI in companies, we find the same answer,” Grumbach said. “Holding on to DEI promises ultimately had no impact on financial performance.”
That conclusion could reshape how executives think about the business risk of maintaining diversity programs. DEI policies can influence who gets hired, promoted, funded and represented in leadership — areas where Black workers and business owners have historically faced barriers.
The findings arrive as corporate America continues to reassess its approach to diversity
following political pressure, legal uncertainty, and consumer backlash. Nevertheless, political pressure and financial performance are not necessarily the same thing. Companies may have more room to stand on their stated values than the “go woke, go broke” crowd would have Wall Street believe.RELATED CONTENT: EEOC Race And Sex Reporting Almost A Wrap Thanks To Trump’s Administration