16868: Overreaction Of The Week.

 

Major brands are hyping Black Friday sales—despite abandoning Blacks via discounting DEIBA+ dedication. It’s holiday hypocrisy hijinks.

 

 

16867: Celebrating Native American Heritage Day In Adland.

 

Today is Native American Heritage Day—or for White advertising agencies, it’s Black Friday.

 

After all, Native Americans are woefully underrepresented in Adland. And in recent years, their stereotypical images have been erased as brand mascots.

 

The chances of appointing a Chief Diversity Officer are highly unlikely too.

16866: Happy Thanksgiving.

 

(AI-generated jive turkey)

16865: Chief Diversity Officers Exploring Diverse Offers—Or Just Being Offed?

 

Advertising Age published the annual—and even semi-monthly—report on trials and tribulations experienced by Chief Diversity Officers.

 

The latest installment shows CDOs not only face defunding, disinterest, and disrespect—now they’re being dumped.

 

MultiCultClassics labeled 2021 The Rise Of Human Heat Shields, as White advertising agencies scrambled to integrate CDOs into exclusive company cultures. Roughly three years later, Ad Age heralds the reverse of a performative trend.

 

The spotlighted whining and gnashing of teeth reruns standard sufferings: lack of commitment, lack of authority, lack of finances, lack of resources—and let’s not forget lack of diversity.

 

The pathetic paradox progresses; that is, Chief Diversity Officers have no impact on diversity. Add the irony of CDO dismissals literally decreasing diversity.

 

Indeed, Sanford Moore’s CDO perspective still rings true today, presenting reality in about 4,000 fewer words than Ad Age.

 

Agencies are laying off chief diversity officers—inside the DEI cuts and what’s next

 

Ad Age explores why agencies are laying off DEI executives, while some fear cuts will only increase under Trump

 

By Lindsay Rittenhouse

 

The role of chief diversity, equity and inclusion officer—a position that just four years ago, in the wake of George Floyd’s murder, was heralded as essential to transforming the advertising industry—has been in troubling decline, with agency holding companies eliminating or consolidating the position amid overall cutbacks in budgets and resources devoted to DEI.

 

Now, some in the industry are fearful that DEI could suffer even steeper cuts after Donald Trump was elected president earlier this month, according to 17 diversity, talent and other ad leaders who spoke with Ad Age.

 

Trump has proposed rolling back DEI efforts, including taking federal funding from public schools that address issues such as racism or gender in their curricula. The changing political environment has already prompted brands such as Meta, Tesla, DoorDash, Lyft, Home Depot, Wayfair and X to make cuts to their DEI teams. Other major marketers including Harley-Davidson, Tractor Supply, John Deere and Lowe’s are scaling back or dropping DEI initiatives.

 

Agencies are now bracing for further cuts. “With the election outcome, it’s clear that the role of the chief diversity officer will continue to diminish at a corporate level,” said Tamon George, co-founder and CEO of Creative Theory Agency. That sends a signal to employees of color that diversity efforts were “never important in the first place,” said one former agency executive who was laid off earlier this year.  

 

Reasons for the falloff

 

DEI roles overall in the U.S. increased by 55% in 2020 following social injustice protests, according to the Society for Human Resource Management. But in recent years, there has been a slowing of these hires. As companies underwent layoffs and cut back on costs, the attrition rate for DEI roles was at 33% at the end of 2022, compared to 21% for non-DEI jobs, according to New York-based workforce analysis firm Revelio Labs. More current figures were not available.

 

Part of the reason for the falloff: Companies didn’t invest or benchmark properly for the role to begin with, setting DEI leaders up to fail, according to the people interviewed for this story. So when agencies were forced to make cuts due to lost accounts or to boost earnings, these jobs were some of the first to go. 

 

These people also cited the wave of conservative lawmakers and activists lodging attacks on DEI across the country, making companies more cautious about how they frame their DEI roles and departments. They said the backlash has caused some companies to rebrand DEI jobs to bring initiatives such as sustainability under its remit, or do away with the role entirely.

 

“It started with the Supreme Court’s decision to remove affirmative action,” said Kumi Croom, managing director for agency Duncan Channon and DEI advocate, referencing a U.S. Supreme Court ruling in June 2023 that effectively ended affirmative action in college admissions. “Then you start having debates over the meaning of words and—I’ve seen within organizations—what this commitment really means. Having it be an anomaly instead of just a norm, that is where people are really failing. This should not ever be an anomaly, it should be a norm—all you’re trying to do is make sure that you are removing bias and that you are creating a space for everyone to belong.”

 

Some agencies argue that there is less of a need for a DEI officer because, rather than “siloing” the role, shops have already embedded diversity and inclusion philosophies throughout their agencies, making it everyone’s responsibility.

 

But several people, including executives at agencies that have cut the role, reject that idea, saying that the elimination of the chief diversity officer is having a negative impact on company morale and culture. Those people said they’ve seen their employee resource groups, established to help support workers of color, suffer since their chief diversity officer was laid off. Many people who spoke with Ad Age, including agency executives and consultants, said if the industry truly wants to have a diverse and inclusive workforce, agencies and marketers need to reprioritize this position.

 

Further cuts on the horizon

 

Diversity advocates are particularly concerned that the new presidential administration will give brands and agencies license to stop investing in diversity efforts.

 

“Our contracts, strategies and tactics are now, more than ever, at the mercy of leadership to understand that equitable inclusion requires tactics that serve minorities and those that DEI initiatives were supposed to safeguard,” said Dawn Wade, managing partner and chief strategy officer of independent agency Nimbus. “We anticipate that brands will pull back and use the recent outcomes as an excuse not to do the work, or they will find clever ways to work around the implicit and explicit biases the incoming administration has been pushing.”

 

Creative Theory Agency’s George, however, said the opposite could be true for companies that have made “a foundational commitment” to DEI. “I expect to see internal advocates doubling down on creating inclusive environments and processes, almost as a form of quiet resistance,” he said. “For them, advancing DEI will be an intentional act, reinforcing the values they believe in despite broader trends.”

 

Ashish Prashar, a political strategist, human rights activist and former agency executive, most recently holding the title of global CMO of Interpublic Group of Cos. agency R/GA, said he doesn’t necessarily think Trump will “have that much of an impact” on DEI. Trump’s “mantra” has been to leave the decision of DEI to the states and individual companies, in a capitalistic fashion, he said.

 

This could lead to CEOs who never placed a high priority on DEI using Trump as an excuse to make cuts, Prashar said.

 

“Leaders will use Trump to say, ‘Oh we can’t do these things now,’” he said. “That’s political cover, to not do something they didn’t believe in the first place.”

 

DEI layoffs and lack of replacements

 

Well before the election results, chief diversity officers were already facing layoffs at holding companies.

 

Lea Taylor, who led DEI for Publicis-owned Razorfish, was impacted by the broader layoffs that resulted in the loss of 150 to 200 employees at the holding company’s digital experience agencies, Ad Age reported last month. Razorfish and Taylor declined comment.

 

IPG Mediabrands consolidated individual agency DEI efforts within the network in April—now all DEI efforts for agencies under IPG Mediabrands, including UM and Mediahub, are handled by one group division. That led to the layoffs of executives including Michelle Gustilo-Smithson, Mediahub’s former VP and HR director of diversity, equity and inclusion, and Jeff Marshall, the former chief diversity officer and head of diversity, equity and belonging for UM Worldwide.

 

An IPG Mediabrands spokesperson confirmed the consolidation efforts of its “people experience” function, which includes DEI. “Our goal was to deliver a more consistent, connected experience for all employees by ensuring they have access to the most impactful programs and talent initiatives that exist across our network,” the spokesperson wrote in an email to Ad Age.

 

And although Omnicom’s DDB Global Chief Diversity, Equity and Inclusion Officer Nikki Lamba left on her own accord in June 2023, the agency did not replace her in the role.

 

“Nikki made her own voluntary decision to leave,” a DDB spokesperson wrote to Ad Age in an earlier statement. “Her relationship with DDB was strong through to the end, where she agreed to work an extended notice period to ensure business continuity.”

 

The spokesperson added that DDB has shifted DEI responsibilities “from a siloed practice,” and handed them to the existing people and culture team. “We will continue to closely partner with Omnicom [Chief Equity and Impact Officer] Emily Graham and our many talented, and diverse leaders across the DDB network to keep DEI&B a top priority.”

 

Lamba declined comment. Gustilo-Smithson and Marshall could not be reached for comment.

 

Best practices for inclusion

 

Some agencies and industry groups maintain that eliminating or centralizing the chief diversity officer role could indicate a sign of progress. For some shops, said 4A’s CEO Marla Kaplowitz, DEI is more embedded throughout the entire agency and therefore is a priority for all C-suite leaders, versus one executive.

 

During the height of the pandemic in 2020, agencies faced financial pressures and mass layoffs but were also hiring chief DEI officers because this foundation had yet to be established, Kaplowitz said.

 

Ad Age reached out to all of the major holding companies for this story; most declined comment or argued on background that they were continuing to invest in DEI.

 

An IPG spokesperson said that the holding company is doubling down on DEI with its launch of Rise—a set of tools that the holding company’s employees across agencies can use to build more diverse teams and drive growth for the company and clients. Under that program, IPG is also going to be launching a visualization tool called the Floominator, which R/GA built, that is being beta tested right now but can be used to create diverse visuals such as iconography for clients. “We’re making diversity an economic multiplier, just like creativity or gen AI,” the spokesperson said.

 

Chief diversity officers essentially set DEI priorities for the entire company—they review and revise policies and make recommendations for promoting inclusion in hiring practices or even in the campaign the agency or marketer is putting out in the world. In the past, the role was siloed within HR, but it later was broadened as advertisers and marketers committed to making chief DEI officers part of every department. The idea was that inclusion would be embedded in everything the companies did—but whether that actually happened is questionable.

 

IPG’s FCB Chicago said it’s been able to embed DEI throughout its agency, but it’s also not scaling back on the function. The way it did this was by first hiring Marc Wilson in 2020 to advise on inclusion both internally, in the way the shop approaches hiring and retaining its own employees, and externally, in the way client work is showing up in the world.

 

As the executive VP, executive director of strategic inclusion, Wilson said he is part of the four-member DEI department. He works alongside HR practitioners on internal and talent-related matters, but he’s not siloed to HR. He said he reports directly to FCB Chicago CEO Kelly Graves and is brought in on agency pitches and the creative process to oversee the work, as often as the chief creative officer.

 

Wilson said he is brought into every chemistry meeting with a potential new client, along with the CEO, the chief creative officer and the chief strategy officer. Clients “see this, [and know] DEI, strategic inclusion is a priority,” he said.

 

Since Wilson was appointed, FCB Chicago has launched 10 employee resource groups and 66% of the FCB Chicago office participates in at least one. To date in 2024, 70% of FCB Chicago’s Black employees reported a strong sense of belonging, a 25% increase since 2020, according to the company, and 89% of FCB Chicago’s employees surveyed in 2024 reported that they feel the agency values diversity, equity, inclusion and belonging. According to the agency, the inclusion strategy Wilson leads with clients helped win brands including Great Wolf Lodge, Home Instead and Nature’s Path, and contributed to over $20 million in new business growth in the last year at FCB Chicago.

 

FCB Chicago also pointed to “Love, Your Mind” as an example of a successful campaign that came together thanks to Wilson’s influence. The PSA (below)—a joint effort from FCB’s Chicago and New York offices, alongside the Ad Council, for the Huntsman Mental Health Institute in 2023—aimed to break down the barriers that exist for Black and Hispanic men to seek mental health support, and garnered 1.5 billion impressions.

 

Having multiple teams work on DEI is not “a bad thing,” but agencies should have one point person (like FCB Chicago’s Wilson) to oversee the work to ensure it’s getting done, said Darren Martin, founder and chairman of integrated marketing firm Streamlined Media & Communications and founder and CEO of its subsidiary, Bold Culture, an inclusive marketing and workplace development consultancy. “Multiple people work on creative within an agency, but there's still a chief creative officer. An agency can have hundreds of strategists and there's still a chief strategy officer.”

 

Martin praised WPP-owned VML’s approach to inclusion, which has seemed to separate its inclusion executive leadership into two parts: Tasha Gilroy is the global chief belonging officer and Ezinne Okoro is the global chief client and culture strategy officer (she was global chief inclusion, equity and diversity officer before VMLY&R merged with Wunderman Thompson in October 2023).

 

Gilroy and Okoro said on a joint call with Ad Age that they while they work together, Gilroy is focused on internal, employee-related matters, and reports to VML’s chief people officer, whereas Okoro’s role is more client-facing and involves how to promote inclusion within the work the agency creates. Okoro reports to the agency’s chief client officer, but both executives said they have a direct line to VML Global CEO Jon Cook.

 

Okoro said she both supports clients, as well as the agency’s teams, to ensure “everyone is doing their best to continue to increase representation everywhere … it’s all connected. In Tasha’s world, [she’s] thinking about how we are elevating our people and our brand presence to get the best people to work for us and to stay there. And then because we have those best people in there, I can get those people thinking about how they work directly with our clients. It’s a full circle, fluid” process, she said.

 

Gilroy also praised VML for giving her and Okoro a seat at the table and room to voice their opinions on what the agency needs to do to progress DEI, both internally and externally.

 

“We have access,” Gilroy said. “We have access to the executives, we have access to the client teams, we have access to the influential leaders that sit across the agency globally. Having access and being able to call things out, or to inform and educate, has been a tremendous way in how we partner with the executives across the agency.”

 

Despite some agencies embedding DEI throughout their companies, some in the industry said they haven’t seen that practice widespread.

 

Prashar, for one, said at the various agencies he’s worked, he never saw DEI embedded into the entire organization. “That’s bullshit.”

 

Sometimes, one problem with keeping the role tethered to HR is that DEI officers are not given “specific” business goals, therefore their performance can’t be proved and tracked; so when layoff decisions are made, it’s an easy job to cut, Duncan Channon’s Croom said.

 

“A lot of businesses [and] agencies got to work on this because of a moment in society, and if you weren't entering into it for the right reasons, it was never going to succeed,” Croom said. “If you didn’t root it in agency and company goals, that role was always going to disappear with layoffs because you can’t justify it.”

 

Wilson said FCB Chicago has specific DEI goals every executive must meet, including in recruiting diverse employees. The shop also has inclusion guidelines to follow that steer how campaigns come together, “all the way from inception, to strategy, to the work, to production.” 

 

Okoro said her performance is tracked in a similar way a chief client officer is, based on specific new business and organic growth goals. Gilroy said her KPIs vary but she’s responsible for such things as adhering to certain government and client contracts that require the agency has diverse representation across teams.

 

Few open roles

 

However the function is set up, there are still many chief DEI executives impacted by layoffs who are reportedly left without work; one advertising talent recruiter said these jobs are scarce.

 

The former agency diversity executive who was laid off this year said because there are not many open DEI roles, they have been applying to HR jobs. But this person, who spoke on condition of anonymity, believes they are not being hired because they have a background as a DEI lead.

 

“I’ve applied to over 200 roles and I’ve gotten a handful of interviews, but nothing has been productive or fruitful,” the former DEI executive said.

 

This person said they only got interviews after changing their title to reflect more of an HR-focused background than a diversity-centric one. Still, they said they wouldn’t hide that DEI would be a priority for her, and in one job interview, they asked the recruiter about the hiring company’s representation and other DEI efforts. The recruiter told the person: “‘I feel like this may not be the best opportunity for that.’”

 

“​​It’s been a big learning curve for me,” the former agency DEI executive said. “I used to be able to apply for a job and pretty much get an offer and that is not the case [currently].”

 

Impact on ERG

 

The former agency DEI executive quoted above said that while their role remained within HR, they were still able to make a real impact. They said they founded and led many employee resource groups—which are also largely receiving backlash from conservative groups—for various diverse workers as well as task forces that provided monthly inclusion-based training and education for the entire agency.

 

A senior-level employee who is still employed at the agency that laid off the DEI executive, said budgets have since been cut for the employee resource groups.

“People were crying … [that executive] kept all the ERGs together,” they said, recalling the day the executive was laid off. The executive “had meetings with us” and was always finding ways for us to collaborate. It was felt very, very heavily.”

 

“There is a lot of uncertainty. We really thought DEI was on the forefront after George Floyd. Now, budgets are taken away; it feels like it was all for optics,” this person continued.

 

Most people interviewed for this story said these cuts will only exacerbate the industry’s existing problem with recruiting and retaining diverse talent.

 

The Association of National Advertisers’ annual Diversity Report for the Advertising/Marketing Industry, which came out in February, found that diversity within the marketing industry dropped for the first time in several years in 2023: people of color made up 30.8% of the marketing industry last year, down from an all-time high of 32.3% in 2022. And a 4A’s study last year found that the number of agencies owned or run by white executives jumped to 90.2% in 2022 from 73% in 2021.

 

Prashar said without chief diversity officers, agencies will likely continue to lose employees of color, and that will ultimately negatively impact the work. He said another issue to consider is AI.

 

“Our industry is obsessed with AI right now,” he said. “There have been reports by credible publications that AI is already biased against people of color, women, all sorts. We need [DE&I leaders] in the room to help design something that is not biased, racist or sexist. That’s why DE&I is important.”

 

Still, Creative Theory Agency’s George said the noise around generative AI is also overshadowing DEI, even if “one of the most important places” for diversity to be considered “right now is in the development and deployment of artificial intelligence.”

 

“AI at this exact moment is the perfect scapegoat,” George said. “It’s taken all the air from every single room. It has conveniently shifted the attention away from the sometimes polarizing work that sometimes exists in DEI strategy.”

 

What companies did wrong

 

Companies made other key mistakes in setting up their DEI teams, outside of keeping them confined to HR, according to people interviewed.

 

Some companies failed to invest in the right talent or didn’t support them with full teams, said Lisette Arsuaga, co-president and co-CEO of DMI-Consulting, a strategic marketing firm specializing in diverse segments, and co-founder of the ANA’s Alliance for Inclusive and Multicultural Marketing.

 

“Too often, there weren’t strategies in place that supported these positions, or even full buy-in for the need for such roles,” Arsuaga said. “To make matters worse, many times diverse executives were hired to head DEI simply because they were diverse and not because they had [diversity, equity, inclusion and belonging] experience. The sum of these parts affected the success of these roles throughout corporate America and the perception of their need.”

 

She said companies that had success and have continued to make progress have been “strategic, embraced the role, hired the right people and attributed the right KPIs to measure the impact.”

 

AIMM will put together a playbook for companies on the right KPIs to track for DEI, but Arsuaga pointed to a key stat that advertisers and marketers should be conscious of as they invest in this space: “Culture is responsible for anywhere between 55%-66% of a campaign’s success.”

 

“When a company doesn’t have the right representation in the room, it’s nearly impossible to get culture right,” she said.

 

To be sure, there are companies continuing to invest in the DEI role. Nike’s new CEO, Elliott Hill, recently appointed Kizmet Mills as its new chief DE&I officer and VP. She was previously a senior director in the division and replaces James Loduca, who announced his departure at the end of the year in a LinkedIn post, writing he would be leaving to spend time with his family. Mills’ promotion comes as Hill oversees a reshuffling of staff and looks to position Nike for a turnaround after a year of declining sales and layoffs.

 

“At Nike, we strive to be leaders in fostering a strong culture of belonging and believe that the work of our diversity, equity and inclusion team is critical to helping us achieve this mission,” a Nike spokesperson said in a statement to Ad Age when asked about its DEI efforts.

 

Rebranding DEI

 

There is also a “rebrand” of DEI that is happening across America due to the conservative backlash.

 

Duncan Channon’s Croom said she’s heard discussions around companies wanting to drop the “E” for “equity” from DEI, for example, because “it was automatically getting tied to race. Why is equity only about race?”

 

“People are just rushing to change the program so they don’t get in trouble or it doesn’t get any backlash,” she said.

 

Creative Theory Agency’s George said he’s seen “less intensity” for brands and agencies to bring DEI into the conversation.

 

“I’ve seen over the years, the start of DEI transitioning to a sustainability conversation,” he said, attributing that to a hesitancy from advertisers and marketers to “shine too bright of a spotlight” on the inclusive work they’re doing due to the current political environment.

 

Calcium+Co. is a health communications group of marketing agencies and brands that recently rebranded its diversity, equity, inclusion and belonging team to the broader Social Impact Initiative, with a renewed focus on “allyship, social responsibility and cultural purpose.” The agency also eliminated its chief DEI&B role in that process. Melissa Morrow, partner and chief people officer, is now head of the Social Impact Initiative.

 

Greg Lewis, group president and managing partner of Calcium+Co., said he felt by rebranding its diversity efforts to the Social Impact Initiative, it was making those efforts more inclusive. What now falls under that team is far-ranging, from accessibility to different social issues surrounding health care and access to health care. It’s something that can both have an internal and external impact, he said.

 

“We didn’t want [the efforts] to be limited just to what letters we select,” added Nicole Camacho, an account supervisor who was made the Social Impact program director. “We purposely chose Social Impact because it goes beyond the conversation of what DEI is—the real big part that we want to embrace is the action and the output.”

 

In some cases, Arsuaga said the rebranding of DEI can be “a survival tactic.”

 

“We believe a rose by any other name would smell as sweet … that is to say, keep the work going by whatever means necessary as long as the pillars for diversity, equity, inclusion and belonging are part of the considerations,” she said.

 

Still, “rebranding efforts can have a damaging impact internally on DEIB team brand recognition and credibility,” Arsuaga added. “As employees search for DEIB support, rebranded teams should ensure they don’t lose contact with those they serve … Diversity means everyone, and it’s through this important work that companies will see innovation and inclusive growth.”

 

Contributing: Brian Bonilla

16854: Save Money. Live Whiter. Walmart.

USA TODAY reported Walmart joined other major brands in discounting DEIBA+ dedication.

 

Was the mega-retailer’s commitment to justice and equality ever more than corporate propaganda? Walmart appeared authentic in its advocacy—albeit by virtue of throwing lots of money at heat shields.

 

Hell, Walmart delivered performative PR in 2012 that inspired the term crumbs.

 

Walmart, the nation’s largest private employer, rolls back DEI under pressure

 

Jessica Guynn | USA TODAY

 

Walmart, the nation’s largest private employer, is the latest company to make changes to its diversity, equity and inclusion initiatives under pressure from a conservative activist.

 

The retail giant said it would not renew a racial equity center it created following the 2020 murder of George Floyd and it would no longer participate in an annual benchmark index from LGBTQ+ advocacy group the Human Rights Campaign.

 

Robby Starbuck said he warned Walmart last week he was working on a report about “wokeness.” According to Starbuck, the company then engaged in “productive conversations” to make changes. 

 

“Removing wokeness from Walmart has both downstream effects on suppliers and it sets the tone for corporate America,” Starbuck told USA TODAY. “Changing the normal operating policy at a nearly $1 trillion company is a gargantuan feat that many have tried to achieve but no one until now has actually been able to get done.”  

 

Walmart also committed to monitoring third-party items in the Walmart marketplace for “inappropriate sexual and/or transgender products marketed to children;” reviewing all Pride funding; and no longer using the term LatinX in official communications, Starbuck said.

 

Walmart said many of the DEI changes were in the works for a few years and were not a result of the conversation with Starbuck. For example, Walmart said it already switched its terminology from DEI to belonging and made changes to its supplier diversity program.

 

“We’ve been on a journey and know we aren’t perfect, but every decision comes from a place of wanting to foster a sense of belonging, to open doors to opportunities for all our associates, customers and suppliers and to be a Walmart for everyone,” the company said in an emailed statement.

 

After the murder of George Floyd in 2020 forced a historic reckoning with race in America, businesses pledged to make their workforces and their leadership better reflect the communities they serve.

 

Employees of color are underrepresented at every level of power in corporate America, according to USA TODAY data investigations. One analysis in 2023 found that white men account for 7 in 10 executive officers in the nation’s largest companies. About 1 in 7 of these companies had executive teams made up only of white men.

 

But four years after those 2020 promises, the political landscape has shifted. Though corporate diversity efforts are broadly supported by the American public – especially younger Americans – they face growing scrutiny in the courts and in statehouses across the country as right-wing foundations, think tanks and political operatives push “race-neutral” policies. 

 

The Supreme Court decision in 2023 to ban the consideration of race in higher education only emboldened attacks on workplace programs. 

 

Public sentiment has also shifted. Consumer boycotts that slashed sales forced some brands like Bud Light and Target to retreat from marketing campaigns to the LGBTQ+ community. Major brands like Ford and Lowe’s have abandoned initiatives and overhauled teams after pressure from Starbuck.

 

In conservative circles, the 2024 election is being viewed as a referendum on DEI. President-elect Donald Trump has pledged to crack down on corporations that do business with the federal government.

 

More than 60% of corporate executives surveyed by business research group The Conference Board view today’s political climate for corporate DEI as very or extremely challenging, and most expected continued or escalating pushback.

 

Even so, fewer than 10% of the organizations planned to scale back their DEI commitments over the next three years. 

 

Proponents say DEI programs are good for business, helping companies hire and retain diverse talent and create environments that boost innovation. 

 

But business leaders are reluctant to talk about their initiatives. Major corporations including Walmart recently declined to make executives available to USA TODAY to discuss their DEI programs.

16853: 4 MAD AVE, ERGs R EZ PR & BS.

 

Campaign published a PRWeek U.S. report claiming corporations are not dismantling ERGs, despite defunding, deferring, and demolishing other DEIBA+ initiatives.

 

It’s unclear if sustaining ERGs applies to White advertising agencies too. If Adland decides to deliberately demonstrate dedication for ERGs, here are likely reasons why:

 

First, ERGs don’t cost anything—not even crumbs—since most groups are voluntary endeavors, cultural cliques offering support systems with little or no cash value.

 

Second, ERGs offer—albeit reluctantly—free “consultation” at White advertising agencies. That is, members must serve as culture SMEs—creating the modern-day equivalent of asking the mailroom attendant or cafeteria crew to weigh in on concepts.

 

Third, and most importantly, ERGs don’t require anything from White staffers. Legitimate DEIBA+ initiatives demand intention, budgets, and action. It takes work that Whites are unable and/or unwilling to provide—in contrast to commitment-free ERGs.

 

In short, White advertising agencies can back ERGs by doing nothing.

 

Why corporate America isn’t retreating on ERGs like it did on DEI

 

By Chris Daniels

 

Lesson learned: Companies are making sure that employee resource groups are a much more difficult target for right-wing activists.

 

The saying “a virtue never tested is no virtue at all” expresses the idea that values — such as inclusivity, empathy, authenticity and kindness — are only true when challenged and consistently upheld. 

 

Now employee resource groups (ERGs) are under the microscope. In the age of aggressive anti-woke activism, companies and PR agencies are repackaging their ERGs to take a potential target off their backs while continuing to give their talent a sense of belonging and acceptance. 

 

There are many corporate benefits to ERGs. They improve recruitment, retention and advancement and promote a more diverse, equitable and inclusive workplace. They benefit corporate reputation, aligning company cultures with employee values. And they improve business outcomes, shaping product offerings for target communities. 

 

Yet despite these well-established benefits, some companies are backing off support for ERGs. For instance, Lowe’s said it decided to combine its ERGs, which were for “individual groups representing diverse sections of our associate population,” into one umbrella organization. 

 

Right-wing influencer and activist Robby Starbuck, a former music video director who unsuccessfully ran for Congress from Tennessee in 2022, took credit for Lowe’s change. Starbuck posted that he reached out to a Lowe’s executive with plans to “expose” the company’s “ERGs based on the sex people prefer to have” as well as “funding Pride events and transitions via healthcare policy.”

 

Starbuck and other conservative activists are emboldened by the Supreme Court’s decision last year to strike down affirmative action in college and university admissions, anti-DEI laws passed at the local and state levels and Donald Trump’s election win.   

 

Other companies that have shared plans to scale back ERGs along with DEI initiatives include Ford and John Deere. The National Black Farmers Association accused John Deere of removing a list of awards it won for inclusiveness, as well as the names of about a dozen ERGs, from its website. 

 

Lowe’s, Ford and John Deere did not respond to requests for comment. 

 

Starbuck, who has also been celebrating “wins” after Ford, Molson Coors and John Deere withdrew from Human Rights Campaign’s Corporate Equality Index, has boasted about the influence and chilling effect he and his supporters have on companies. 

 

“We’re now forcing multibillion-dollar organizations to change their policies without even posting just from fear they have of being the next company that we expose,” he wrote.

 

Corporate brands aren’t the only ones that seem to be fearful. PRWeek contacted more than a half-dozen major PR agencies, and several with employee-led and employer-supported ERGs refused to speak about the topic. One agency leader said many firms are still trying to wrap their heads around ERG counsel. 

 

“We are in the midst of thinking about implications for all of our clients and will be sharpening our thinking in the near future,” said one agency exec. 

 

Those who did speak to PRWeek say clients aren’t planning to get rid of ERGs, but they are thinking about repackaging them to adapt to the cultural and political moment, and to protect themselves in the event of a legal fight. 

 

Molson Coors, which said it will stop requiring “representation goals” in its hiring process, hasn’t gotten rid of its ERGs. In a memo to employees read by PRWeek, the brewer said, “To provide clarity that the mission of our existing employee resource groups is centered around business objectives, consumer dynamics and career development, moving forward they will be referred to as business resource groups.” 

 

To use a beer analogy, it’s the same brew with a new label. 

 

Molson Coors declined a request for comment.

 

“I have not come across a single company that has intentions to sunset ERGs or broadly end DEI commitments,” says Elle Arlook, who leads APCO’s equity and justice practice. 

 

Arlook said she has had conversations with 10 clients about DEI risks this week.

“Clients are coming to us with concerns about protecting elements of their DEI programming and mitigating potential risk given the broader external environment,” she says. “While many companies are certainly toning down how and how much they talk about DEI, most understand that the impacts of DEI programming are valued by employees and contribute to strong business performance.” 

 

In fact, Arlook says companies are planning to bolster ERGs, particularly in the midst of intense political and social divides, where even members of the same group may be split on the issues dominating outside conversation. 

 

“Many of our clients are reviewing and strengthening the foundations of their ERGs, from ensuring ERGs have clear charters and defining their role within the company's culture and leadership structure to preparing guidelines for communications and toolkits for programming,” she says. “In this moment, it’s important for companies to take a step back and ensure that the structure and remit of ERGs are tied to a clear set of business priorities and objectives.” 

 

While Starbuck frames his anti-DEI crusade as getting politics out of corporate America, that’s clearly a fallacy, says Deidra Johnson, SVP and Justice, Equity, Diversity and Inclusion (JEDI) advisory services practice lead at Porter Novelli Atlanta. 

 

“While Starbuck claims to stand against all diversity, equity, and inclusion efforts, his criticisms rarely extend to groups created to support veterans, people with disabilities or women,” says Johnson. “One of his primary focuses is calling for the end of all transgender inclusivity, labeling anyone who supports the LGBTQIA+ community as ‘woke’ and ‘non-American.’”

 

She also encourages CEOs “to remember the purpose and values of their corporation and not to waiver on either of these. Don’t feel pressured to respond because someone posts an untrue video or social media message about you.”

 

Some in-house executives say companies that have backtracked on ERGs and DEI initiatives may be self-inflicting a lot of damage. A chief communications officer at a Fortune 500 brand says these companies are essentially standing by as outside actors recruit their employees. 

 

“A corporation that has championed DEI, publicly supported the LGBTQIA+ community and proudly waved the Pride flag, only to erase those commitments from its website when faced with criticism, hits that ERG so, so hard,” says the executive. “What you’re essentially telling those employees is, ‘When you were under attack, we chose to open the door and let the attack in.’”

 

“Corporations are people-powered vehicles,” adds this exec. “You have to respect the people who work for you, and if you start making moral compromises, a percentage of your workforce that you don’t want to lose is going to be brushing up on their resumes.” 

 

Instead, this in-house leader says corporations should engage in dialogue with their ERGs, not about removing language from corporate communications, but rather to refine and fortify it so they can withstand scrutiny. 

 

Naria Frazer, SVP of people experience and belonging at Praytell, says companies risk their reputations by giving in to far-right-wing threats. 

 

“While some companies may scale back or rebrand ERGs in an effort to avoid controversy, this approach carries significant risk. Diluting these groups sends a message that comfort takes precedence over commitment, which can erode trust among key stakeholders, both employees and consumers alike,” she says.

 

Frazer says corporate America should be doing the opposite. 

 

“The current climate may challenge DEI efforts, but it also calls for greater intentionality, strategy and louder voices. True leadership means standing firm in your values, speaking up for others and moving forward with bold, consistent action,” she says. “Forward-thinking companies are doubling down on ERGs, strategically aligning them with environmental, social and governance goals and embedding their work into measurable business outcomes,” 

 

Frazer says a proactive strategy also includes using storytelling and hard data to build a compelling narrative for their value; equipping leaders with training and resources to navigate challenges and advocate for their groups effectively; and engaging legal teams to safeguard ERGs and address vulnerabilities. 

 

“By positioning ERGs as drivers of innovation, recruitment, retention and cultural intelligence, companies ensure these groups are viewed as business assets rather than liabilities,” says Frazer.

 

This story first appeared on PRWeek U.S.