Navigating Corporate DEI Post-Affirmative Action: Challenges and Opportunities
by Kelly Lewis, Vice President at TurnkeyZRG
Following the Supreme Court's decision to strike down Affirmative Action at colleges and universities, our nation faced a multitude of varying emotions and equal amounts of confusion. Even with Asian Americans holding mixed views around Affirmative Action, the barring of race-conscious admissions is seen as an opportunity to combat what many see as discriminatory practices. For others, the conversation has led to the underlying tone of questioning the academic merits of Black, Latino, and Native American students, the perpetuation of the belief that Asian Americans are a monolith, and the unfortunate pitting of people of color against one another. Despite the validity of everyone's feelings, the Supreme Court has spoken, leading one to the question if corporate America's race-conscious efforts are the next target.
The termination of Affirmative Action has called into question the validity and appropriateness of corporate Americans' diversity initiatives. While corporate diversity efforts are not comparable in certain respects to university ones, this has not stopped the uptick in targeting such corporate efforts. Fortune 100 companies have been contacted by conservative attorney generals declaring the striking of Affirmative Action as grounds to critically assess DEI initiatives in private corporations. The seven-page document letter states, "racial discrimination in employment and contracting is all too common among Fortune 100 companies and other large businesses." Companies are told, “if your company previously resorted to racial preferences or naked quotas to offset its bigotry, that discriminatory path is now definitively closed” as a result of the Supreme Court’s decision in SFFA v. Harvard, and these company must overcome [their] underlying bias and treat all employees, all applicants, and all contractors equally, without regard for race." They further criticized several companies and their pledges to foster diversity and support minority-owned businesses particularly the commitments that were a direct response to the racial justice protests in 2020.
Two major flaws are presented in the document. The letter remains ambiguous in what constitutes racial preferences and discriminatory efforts, leading the reader to interpret that any efforts to create parity thorough initiatives targeting an underrepresented group are now under consideration for being illegal. To seemingly support this theory, the letter intentionally suggests that DEI initiatives equate to racial discrimination by using the legal framework under the Title VI (governs race discrimination in government-funded programs) and Title VII (which governs race discrimination in employment). Referencing the Harvard/UNC decision where Justice Gorsuch reasoned principles of Title VI “apply equally to Title VII and other laws restricting race-based discrimination in employment and contracting, [and that courts] “routinely interpret Title VI and Title VII in conjunction with each other, adopting the same principles and interpretation for both statutes.” David Glasgow, executive director of the Meltzer Center for Diversity, Inclusion and Belonging at New York University's School of Law, believes "there's a lot of quite deliberate attempts to muddy the waters here."
Diversity, equity, and inclusion initiatives differ from workplace Affirmative Action. DEI efforts in the workplace expand beyond outreach to new hires; they create employee resource groups for underrepresented employees and develop mechanisms to reduce bias in hiring through training and "blind" applications. Akin Gump Strauss Hauer & Feld LLP suggest currently legally sound corporate DEI programs should not be affected by the court's ruling, as they are protected under Title VII of the Civil Rights Act of 1964 as well as the Employment Opportunity Commission (EEOC) Guidance. The Chair of the EEOC, Charlotte A. Burrows, released an official statement, taking the view that the Court’s decision does “not address employer efforts to foster diverse and inclusive workforces,” and that “[i]t remains lawful for employers to implement diversity, equity, inclusion, and accessibility programs that seek to ensure workers of all backgrounds are afforded equal opportunity in the workplace.” While Legal experts and other leaders seemingly agree with Glasgow, companies remain worried.
Recent attacks have made the business of diversity seem relatively more of a liability than anything else. Attorney Generals made it clear that they will be challenging these efforts, especially those of big names companies like Goldman Sachs, Airbnb, Apple, Cisco, Facebook, Google, Intel, Lyft, Microsoft, Netflix, Paypal, Snapchat, TikTok, and Uber for their commitments to increase racial parity with hires and suppliers. What makes this direct call out of Fortune 100 companies significant is the perception of fear for smaller companies. Particularly as these companies, in theory, have access to the most prominent DEI and employment law leaders. Coupled with headlines like Starbucks ordered to pay over $25 million to white former manager who claimed racial discrimination, it can seemingly lead many companies to question the value of these programs.
But as we know to be true, context matters. Before the national banning of Affirmative Action in higher education, the states of Idaho, Arizona, Florida, Nebraska, New Hampshire, Oklahoma, Washington, California, and Michigan already banned Affirmative Action policies in this sector. This matters because aside from Goldman Sachs, every other entity explicitly referenced to be on high alert for their DEI commitments is headquartered in states without Affirmative Action in their higher educational system dating back to 1996. So, the grounds of Affirmative Action as a mechanism to prohibit DEI in the workplace become feebler when looking beyond the companies of attack.
Diversity programs are beneficial—and even more importantly, they are legal. In a swift ten-page response to conservative attorney generals' letter to corporate leaders, Democratic AGs Pledge Legal Cover for Companies' Diversity Goals. These twenty attorney generals were deliberate in upholding that they, too, are/will be equally holding companies accountable for racial discrimination. They state, "while we agree with our colleagues that companies that engage in racial discrimination should and will face serious legal consequences, we are focused on actual unlawful discrimination, not the baseless assertion that any attempts to address racial disparity are by their very nature unlawful." They argue that "intimidation was the goal of the opposing AG letter and that examples provided lacked sufficient illustrative of DEI efforts that are common across companies." They continue, "we write to reassure you that corporate efforts to recruit diverse workforces and create inclusive work environments are legal and reduce corporate risk for claims of discrimination." They assert, "businesses should double-down on diversity-focused programs because there is still much more work to be done."
More than ever, companies need a dedicated diversity leader to help navigate the turbulent waters ahead. The added layer of external political complexities, coupled with historical DEI challenges facing underrepresented groups, requires organizations to remain committed to DEI. It will be imperative that corporations rethink and evaluate the leaders taking charge of these efforts. Companies will need leaders who are intentionally collaborative with legal and HR, driven to understand changing local, state, and federal legislation, and possess a bi-partisan approach to the challenges of DEI.
Issues
Women in the workplace, acknowledging and addressing biases for those with disabilities, tackling political biases in the workplace, and more.
Navigating age discrimination and generational divides in a multigenerational workforce.
Possible CDO Driven Solutions
Efforts embedded in data that set aspirational goals vs. quota-led racial hiring and training on the hiring do's and don'ts, as well as setting aside clear expectations to address conduct on social media, in and outside the workplace, particularly around controversial topics.
Create policies in place that address age discrimination. Moving Beyond Generation language and jargon. Switch efforts to focusing on life stages (i.e., caregivers and middle career).
Only time will tell what long-term impact the Supreme Court decision ending Affirmative Action will have on employer diversity initiatives. Regardless of whether your company has a dedicated DEI leader or not, any initiatives your company has must be evaluated with a fine-toothed comb. EEOC Commissioner Andrea Lucas expressed that while the decision does not alter federal employment law, she emphasizes the importance of well-constructed diversity programs, as “poorly structured voluntary diversity programs pose both legal and practical risks for companies. Those risks existed before the Supreme Court's decision today. Now they may be even higher.”
I suggest every leader increase their understanding of employment laws, crucial DEI competencies and consider all anticipated challenges on the horizon. Additionally, review and implement DL Piper employer's recommendations for potential subsequent actions in a post-Affirmative Action landscape:
Review voluntary Affirmative Action plans.
Assess other diversity and inclusion programs and initiatives to ensure compliance with anti-discrimination laws.
Review diversity and inclusion training and communications for any statements or language that could be viewed as unlawful.
Ensure management oversight.
Train managers and supervisors on their obligations under anti-discrimination laws
Monitor state laws and anticipate challenges.
Prepare to address employee speech and conduct issues in the workplace and off-duty on controversial topics like Affirmative Action and LGBTQ rights.
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Founded in 1996, TurnkeyZRG is a highly specialized talent recruitment/executive search firm filling C-level, senior-level and mid-management level positions throughout sports, entertainment and media. Over the past 25 years, TurnkeyZRG has filled more than 1,400 positions throughout sports, entertainment and media. TurnkeyZRG helps teams, leagues, stadiums, arenas, theaters, college athletic departments, events, sponsors, agencies, media companies, private equity companies and other clients identify, recruit and hire the very best management talent. Turnkey now benefits from ZRG’s global footprint, full array of industry practice groups, data-driven, analytical search tools, and technology investment in changing the way executive search/talent recruiting is done. TurnkeyZRG becomes a tech-enabled disrupter of the prior executive search model.