The sly trick conservatives have discovered to fight DEI at Boeing, PepsiCo, and across corporate America
- Progressives have long used shareholder votes to advance their DEI agenda
- Now conservatives are aping them with anti-DEI corporate proposals
- READ MORE: The tech firms bucking NASDAQ's push to 'diversify' boardrooms
The shareholder meetings of corporate America have long been a venue for progressive campaigners to push diversity-hiring targets and other pet causes.
Now, conservatives are using the same tactics against their diversity, equity, and inclusion (DEI) efforts.
Behind the doors of boardrooms and annual meetings, right-wing shareholders are putting proposals designed to thwart DEI efforts up for votes.
While they're not yet gaining traction, they are gaining pace.
As recently as 2021, prominent conservative investors only filed a single anti-DEI proposal.
Boeing is one of the companies being targeted by conservative shareholders over the company DEI rules
This year, they have already filed 42, a Bloomberg analysis shows.
Luke Perlot, from the National Legal Policy Center (NLPC), was behind several shareholder efforts.
'We come in, and we start hitting them from the right with proposals that are pretty much anti to proposals being brought by the left,' says Perlot.
'It's almost like they can now cancel each other out.'
Supporters of DEI efforts say they help get more women and minority talent into companies.
But critics call them a form of 'reverse racism' that robs straight, white men of opportunities, regardless of who is best qualified.
In recent years, progressive groups have advanced hundreds of resolutions at shareholder meets to make company policies more supportive of employee diversity, labor rights and other social issues.
But as the backlash against DEI has intensified, the number of so-called anti-DEI proposals has multiplied.
This year, anti-DEI resolutions made up more than a third of the resolutions on social issues.
They were mostly voted down — garnering only 2 percent support, on average.
Pro-DEI proposals were still much more popular in shareholder votes, typically getting 18.5 percent backing.
Perlot says this shows how corporate America has become too progressive and has moved 'mostly to one side and is neglecting the other side of these issues.'
Still, he adds, getting executives to debate proposals can have 'as much of an impact' as the voting itself.
Conservative activists say they make their point, even if shareholders don't back their anti-DEI proposals
Perlot's group and the National Center for Public Policy Research (NCPPR) submitted nearly two thirds of this year's anti-DEI proposals.
It's a coordinated campaign to target Boeing, Alphabet, PepsiCo, and other major firms.
One of the anti-DEI initiatives that garnered the largest backing was a request from NCPPR for Boeing to report on the risks created by its DEI strategy.
Fully 5.3 percent of shareholders supported that proposal.
It was among three anti-DEI resolutions to reach the 5 percent threshold required by the US Securities and Exchange Commission for a shareholder to file the same proposal twice over a five-year period.
Stefan Padfield, director of the Free Enterprise project at NCPPR, says DEI efforts make firms less competitive.
Fighting DEI is 'pro-fiduciary,' he says, and helps companies return to 'neutrality.'
The NCPPR and others say their proposals are formulated to ensure business leaders are considering whether their DEI initiatives detract from the company's fiscal responsibility, and any legal and reputational risks associated with them.
Progressive activists label these proposals anti-DEI because they often ask companies to consider whether a policy favors workers of color over other groups.
They should instead ask companies to ensure they are treating black and Hispanic workers fairly, they say.
That sometimes means the nuance can be difficult to detect in the language of the proposal's summary.
Bloomberg's analysis found that the wording in proposals from pro-DEI and anti-DEI shareholders was very similar, despite their opposing objectives.
On certain topics — like slave labor in the Congo or human rights in China — the wording can even suggest a common cause.
Creating that confusion can be part of the strategy from these groups whose main objective is not to win broader investor support, but to pressure companies, said Heidi Welsh, who runs the Sustainable Investments Institute, a non-profit.
The institute has monitored shareholder votes for more than three decades.
Welsh tracked more than 80 proposals from conservative groups this year that object to environmental, social and governance topics, including DEI.
These recommendations are coming at it from a 'wreck-the-system perspective,' she says.
Stefan Padfield, left, and Luke Perlot, are among the conservative activists fighting DEI in the boardroom
'There are people who are actually serious about this and are making policy proposals that they think will make things better,' Welsh says.
Some anti-DEI groups 'just want to blow it up,' she adds.
The effort comes as corporate America grapples with a slew of complaints and lawsuits that have taken aim at diversity practices following the Supreme Court's decision last year to ban affirmative action programs in college admissions.
America First Legal, a conservative group staffed by former members of the Trump administration, has filed more than 30 complaints to a top US civil rights agency and sued IBM's Red Hat among many other firms.
Meanwhile, former president Donald Trump says he'll fight DEI if he wins November's election, as consumers rail against Harley-Davidson, John Deere and other firms they see as 'going woke.'
Many companies that embraced DEI policies in the wake of the cop killing of unarmed black man George Floyd in May 2020 have stepped back from them for fear of irking conservative customers.
For some, DEI schemes are important and necessary, as they can help to overcome historical racism and sexism and make it easier for people of all backgrounds to get ahead in education and work.
Critics say it's a form of reverse discrimination that unfairly blows back on straight, white men.
