Costco Wholesale, a membership-only warehouse with Montgomery County locations in Gaithersburg and Wheaton, is pushing back against pressure to terminate its diversity, equity and inclusion (DEI) programs. Costco is not alone. Companies such as Apple, Ben & Jerry’s and Delta Airlines are doing the same.
98% of Costco shareholders, who were presented with a proposal earlier this year from a conservative group requesting Costco to investigate the business risks of their DEI policies, voted against the proposal, according to reporting from CBS News.
In the proposal, the conservative group cited the U.S. Supreme Court’s 2023 decision in SFFA v. Harvard, which banned discrimination on the basis of race in college admissions, in their justification for the proposal.
“It’s clear that DEI holds litigation, reputational and financial risks to the company, and therefore financial risks to shareholders,” proponents wrote in the proposal. “Costco still has such a program, though it was apprehensive enough to recognize this as it recently and quietly rebranded its DEI program to ‘People and Communities.’ But sticking a new label on discriminatory practices does not protect Costco and its shareholders from these risks.”
In their response, Costco’s Board of Directors firmly opposed the suggestion, claiming that their DEI policies follow their code of ethics.
“Commitment to an enterprise rooted in respect and inclusion is appropriate and necessary,” Costco said in the written response. “The report requested by this proposal would not provide meaningful addition to our shareholders.”
National boycotts of companies that have reversed their DEI policies have been circulating over the last month, with companies like Target being hit among the hardest. However, Costco’s decision to maintain their policies have made them an exception.
According to reporting from Forbes, Costco saw a 22% increase in web traffic along with a 3% increase in app visits from users following the boycotts. As the Trump administration aims to modify and dismantle DEI, Costco is going in a different direction.
