Companies are pulling back on DEI. What will -2-

Mallick said that against that backdrop, some companies could divide up their DEI duties and hand them off to other departments. A chief diversity officer role, for instance, could be turned into the chief communications and inclusion officer, or chief marketing and inclusion officer, or a chief supply-chain and inclusion officer.

Those roles could drive home diversity in different ways, she wrote in Fast Company in October - by guiding company leaders on how and when to speak with employees on bigger issues, marketing to a broader array of consumers and marginalized populations, and doing business with companies that have a more diverse workforce.

Others have proposed a more holistic framework for approaching DEI that centers on employee welfare. Laura Morgan Roberts, an associate professor of business administration at the University of Virginia, wrote in a Harvard Business Review article that "to bring advocates and critics of this work together, leaders must orient around a broader goal: creating the conditions for all workers to flourish."

Those conditions, she said, should allow employees to be not just themselves but the best version of themselves, via anti-discrimination training and more concerted, constructive feedback. She said they also need the freedom to fail and the freedom to step back from pressure to perform at maximum productivity. Hybrid work and a more diverse workforce, which she said would help people in marginalized groups "blend in to escape scrutiny," could make achieving the latter easier. But those freedoms often don't filter down to women, people of color, people with disabilities and LBGTQ+ people, she added.

But as DEI practitioners try to rethink their jobs, they worry that a less direct approach risks sacrificing focus and accountability.

"The one thing that can be lost is the one thing that everyone's talked about, which is the level of authority and prominence that DEI has in an organization," Hayes said.

Companies "need a person who owns it, who's responsible for it," said Y-Vonne Hutchinson, the founder of the DEI consulting firm ReadySet. "Anytime we go into an organization as ReadySet, and there's no one person responsible or accountable for these things, they lose momentum."

DEI work overall needs to be reimagined, Hutchinson said. But she also said that while executives have often dismissed DEI as a feel-good function, it is in fact a discipline backed by research on how workplace dynamics differ depending on a person's identity and what types of interventions work.

"I have yet to meet a traditional marketer that is going to write the right statement for the Israel-Palestine conflict," she said. "Like, good luck."

Demand for DEI has also endured in areas where the climate for it has been harsh. Hutchinson said that she still gets requests to do work in Texas, which has outlawed DEI work in its public colleges. Companies still don't know how to talk to Gen Z, a generation likelier to look for more than just gestures toward diversity, she said.

She added that increasingly, people are unable to work with one another over political issues - be it over the Israel-Hamas war or this year's presidential election - and politics still affect co-workers' lives even if managers would prefer they keep it out of the workplace. A turn away from DEI risks also being a turn away from the people who might be able to handle those disputes, she said.

That turn could also force DEI opponents, many of whom have said the workplace should be a "colorblind" meritocracy, to say what specific alternatives they actually want in its place, she said.

"Meritocracy never existed in this country," Hutchinson said. "DEI was created to address some really deep-seated biases and wrongs that exist in organizations. If you get rid of it, those biases still exist, and DEI opponents have no solutions for it."

'Let's talk about the things we can do on purpose'

Workplace programs that explicitly use race or another protected classification to focus on one group of people - say, fellowships designated for people of color - are in the biggest legal jeopardy, Yoshino said. Putting staff through unconscious-bias training before they make hiring decisions, however, is likely still on solid legal ground.

Corporate retreats open only to women or people of color, he said, could be vulnerable to a reverse-discrimination suit. But opening up such gatherings to the broader workforce comes with its own compromises - including the loss of "that safe space that used to exist in those retreats," he said.

"You lose the sense of psychological safety," he said, "because everyone here is a person of color, and we can talk about concerns that we have as people of color without worrying that other people are listening who don't have our life experience or shared demographic characteristics."

Companies can still create programs that advance "socioeconomic diversity," since socioeconomic class isn't protected by anti-discrimination laws, Yoshino said in a recent Harvard Business Review article co-authored with David Glasgow, an adjunct law professor at New York University. Taking some steps to foster a deeper sense of employee belonging overall without crimping opportunity - such as establishing all-gender bathrooms and nursing rooms, widening college outreach to draw from a more diverse talent pool and supporting organizations committed to DEI - would serve as a "safe harbor" to current legal attacks, the authors added.

Some also say the changes could help create a deeper sense of shared responsibility in making companies more inclusive. Yoshino told MarketWatch he still sees ways to make DEI work, even with potentially greater legal constraints.

An anti-DEI lawsuit, he said, could bring chief diversity officers and chief executive officers together, jolting leaders into paying more attention to a company's DEI plans. Opening up programs to a broader audience could help ease anxieties, namely among white men, that DEI initiatives are stacked against them. A bigger audience also means more people, he said - including potential allies who might have less fear of retaliation from their bosses and might empathize with and advocate for marginalized groups.

LaToya Rose, the senior vice president of diversity, equity and inclusion at the publisher Macmillan, suggested that companies could learn from what their peers are already doing well and reconsider certain tropes of DEI, like unconscious-bias training.

"Maybe that's not the conversation, and it's about what are we consciously doing," she said. "Is there conscious inclusion? Let's not talk about what we do unconsciously. Let's talk about the things we can do on purpose."

-Bill Peters

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03-01-24 1544ET

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