The Manufacturers Contesting Shareholder DEI Scrutiny
Since the start of his second term, US President Donald Trump has fired off a series of executive orders to cut Diversity, Equity and Inclusion (DEI) policies.
These policies in the US are designed to ensure fair treatment and full participation for all individuals, particularly those from historically marginalised or underrepresented backgrounds.
DEI policies are responsible for developments including broader wheelchair accessibility in the workplace and efforts to remove systemic bias from the hiring process.
Trump has condemned these policies as “dangerous, demeaning and immoral,” repeatedly dismissing them as “nonsense.”
Now his policies to cut DEI initiatives are having ramifications in the corporate sphere.
Regardless of their executives' positions, company shareholders across the board are recognising this industry-wide shift and are preparing to consult on the future of DEI in the workplace.
Although shareholder resolutions are generally non-binding, strong investor support can put pressure on corporate boards to rethink their strategies.
Ultimately, the US Securities and Exchange Commission (SEC) – an independent agency of the US government responsible for preventing market manipulation – will play a crucial role in approving shareholder votes.
Global manufacturers like GM, Coca-Cola and IBM and other companies with significant manufacturing operations are currently reviewing their positions.
Apple
Apple is urging shareholders to dismiss a proposal put forward by the National Centre for Public Policy Research (NCPPR), a conservative advocacy organisation, which calls for the removal of all DEI-related activities including its diverse supplier initiatives.
In its statements, the company has characterised the NCPPR’s proposal as an unjustified attempt at overregulation.
“We strive to create a culture of belonging where everyone can do their best work,” Apple said in a proxy statement regarding the calls to scrap DEI.
Apple’s board is likely to convene in February to discuss further.
Coca-Cola
Apple is advising shareholders to reject the proposal from the NCPPR.
In its communications, the company has described the NCPPR's proposal as an unnecessary and overbearing attempt at regulation.
“The Coca-Cola Company maintains employee representation goals designed to achieve diversity so the company mirrors the markets we serve,” a company statement read.
“The company expects by 2030, our employee population across all job levels will align with US Census data by race/ethnicity: Black: 13%; Hispanic: 18%; Asian: 6%.”
IBM
Technology giant IBM is challenging a shareholder proposal supported by the conservative Heritage Foundation, which calls for the removal of executive pay incentives tied to diversity targets.
The company is moving to have the resolution excluded, arguing that it misrepresents IBM’s policies.
Berkshire Hathaway
Berkshire Hathaway, whose board is set to convene in early May to discuss DEI, is one of the companies seeking SEC approval to exclude an anti-DEI proposal from its annual meeting.
The resolution, put forward by the NCPPR, calls for a legal review of the company’s race-based initiatives.
CEO Warren Buffett has defended the benefits of diversity, noting at Berkshire’s 2023 annual meeting that: “If I had been born Black, a woman, or in a different country, I wouldn’t nearly have enjoyed the same type of life I have.”
General Motors
The NLPC is also challenging General Motors over its DEI policies, particularly advocating for the removal of DEI-related metrics from executive pay calculations.
GM has requested the SEC to block the proposal, asserting that it has already implemented parts of the resolution and that diversity continues to be a central aspect of its corporate strategy.
JPMorgan Chase
Both the NLPC and the NCPPR have submitted shareholder proposals challenging JPMorgan Chase’s DEI initiatives and executive pay structures.
The bank is seeking SEC approval to exclude the proposals, arguing that they relate to standard business operations and do not accurately reflect the company’s practices.
CEO Jamie Dimon has rejected claims that JPMorgan’s diversity efforts present any legal risks.
“We’re going to continue to reach out to the Black community, the Hispanic community, the LGBT community, the veterans community,” he said at the World Economic Forum’s 2025 summit in Davos.
Levi’s
The NCPPR has put forward a proposal urging Levi’s to consider ending its DEI programmes, but the company is actively working to have the resolution excluded from its proxy statement.
Levi’s CEO Michelle Gass has reiterated the company’s commitment to inclusion.
“We’ve been committed to diversity and inclusion for literally decades and it’s the core to who we are,” she told Women’s Wear Daily. “Our commitment remains unchanged.”
Mastercard
Mastercard is confronted with a resolution from the NLPC calling for the removal of DEI and ESG (environmental, social and governance) targets from executive compensation criteria.
While the company has not made a public statement on the proposal, it continues to emphasise inclusion as a key business priority.
PepsiCo
PepsiCo has received a shareholder proposal from the NLPC requesting a review of executive pay guidelines and the removal of DEI-linked incentives.
While Pepsi has not formally responded, the company continues to promote its diversity initiatives in its corporate reports.
What's next?
As the corporate sector grapples with evolving views on DEI, the outcome of these shareholder proposals could significantly influence the future of diversity policies within manufacturing.
While many companies are resisting changes, a growing movement from activist investors indicates that DEI initiatives will remain a contentious issue in the years ahead.
With regulatory bodies such as the SEC playing a crucial role in deciding whether these resolutions proceed to shareholder votes, businesses like manufacturers are likely to face ongoing scrutiny regarding their diversity commitments.
The next few months will be pivotal in shaping how corporations approach DEI in the face of mounting political and economic pressures.
Explore the latest edition of Manufacturing Digital and be part of the conversation at our global conference series, Manufacturing LIVE.
Sign up to our weekly newsletter here.
Discover all our upcoming events and secure your tickets today.
Manufacturing Digital is a BizClik brand.
