Under pressure from Robby Starbuck, who the New York Times called an “anti-DEI agitator that big companies fear most,” Walmart is dialing back its DEI program.
Because Walmart is the nation’s number one retailer and the largest private employer in the country with 1.6 million employees, its about-face on DEI has important implications for all retailers and corporations.
“Companies need to listen to our movement,” Starbuck declared. “We are powerful and growing every single day. We will not stop until we have eliminated ‘wokeness’ from corporate America.”
And he added, “We do have our eyes on Amazon and Target.”
Changes Coming
Announcing the changes on X, Starbuck said Walmart will:
- Close the company’s Racial Equity Center
- No longer participate in the Human Rights Campaign’s Corporate Equality Index
- Review supplier diversity programs so that no company gets preferential treatment based on race
- Discontinue using terms such as DEI and LatinX publicly or privately
- End racial equity training programs.
In addition, Walmart will remove any items sold that may have inappropriate transsexual content for children, such as chest binders for teenagers or books encouraging transition. It will also stop funding events that could expose children to sexually-inappropriate content, such as drag-queen story hours or Pride events.
Walmart confirmed these changes with Bloomberg and the Associated Press; however, it has posted no press release on its website or responded to my request for comment.
Calling For Neutrality
In an in-depth interview with TheStreet’s Conway Gittens about a month before the Walmart news broke, Starbuck explained his position, arguing that existing laws already protect workers from racial, sexual and other forms of discrimination so corporate DEI programs are redundant, even divisive.
DEI programs insert politics and controversial social issues into the workplace, distracting employees from the core business of serving customers, he believes.
“Neutrality is a ground where everybody can be treated fairly with no judgment predicated on their religion or skin color or who you like to have sex with. You sell a product, you provide a service, that’s the core business and that’s what people should be focused on,” he explained.
Politics Over Business
DEI programs, Starbuck said, “have become a Trojan horse for left-wing policy. There’s no reason for public companies to be injecting divisive issues into the business that are dividing your customer base and your own employees.”
He cites Ibram X. Kendi’s book, How To Be An Antiracist, as foundational to corporate DEI programs and recommended reading in DEI training.
Kendi believes racism and capitalism are “conjoined twins” and said in a Salon interview:
“The history of capitalism cannot be properly understood without understanding the history of racism. Racism and capitalism emerged simultaneously, they have grown together, they have ravaged together – and one day, they’ll ultimately die together.”
Such thinking goes too far for Starbuck. “It’s explicitly anti-capitalist. It’s kind of ironic that what are supposed to be capitalist companies are the ones recommending that their employees read it,” he said.
Finding Middle Ground
Starbucks said companies should focus on “merit, fairness, kindness, excellence and innovation,” in the workplace to move the needle on the top and bottom line, instead of investing time, money and resources on DEI initiatives.
“If you just want to succeed as a business, you choose the middle lane of neutrality, where you are available for everybody, you discriminate against no one and you just provide a kind workplace that is the type of place anybody would like to work because you’re just able to do your job without feeling like anybody’s ideology is being shoved down your throat,” he concluded.
DEI’s Foundation Crumbling
A 2015 study by McKinsey became a cornerstone for the widespread adoption of diversity, equity and inclusion corporate policies and programs.
McKinsey’s research found that out of the 366 public companies studied the most racially, ethnically and gender diverse companies delivered financial returns above industry norms. Companies that were less diverse were less likely to perform above national industry norms.
It concluded, “Diversity is probably a competitive differentiator that shifts market share toward more diverse companies over time,” so companies far and wide hopped on the DEI bandwagon.
Disputing DEI Performance Advantage
However, Professors Jeremiah Green, of Texas A&M University, and Sekou Bermiss and John Hand, of the University of North Carolina, tried to reproduce the McKinsey study’s findings against the S&P 500 and could find no statistically-significant correlation between diversity and profits.
“Our results do not support the ‘business case for diversity’ when the claim is assessed using 1-year-ahead financial performance metrics and multiple measures of the race/ethnicity of S&P 500 executives over the last decade,” the researchers conclude. That paper also cites 47 additional academic studies that question the diversity business case.
McKinsey continues to stand by its findings. “Diverse leadership teams are associated with a higher likelihood of financial performance. We have also been clear and consistent that our research identifies correlation, not causation, and that those two things are not the same,” it shared with the Wall Street Journal.
Correlation Vs. Causation
Many corporations have confused the two concepts. “The trouble is that McKinsey behaves as though the studies show causation, constantly talking of the corporate benefits of diversity,” the WSJ wrote.
And there is another logical fallacy that undergirds the corporate diversity arguments: that diversity of skin tone, gender, sexual orientation, preference or other objectively quantifiable measures are correlated with diversity of thought.
Corporations need diversity of thought when it comes to innovation, problem-solving, market and competitive strategies, the ultimate differentiator in corporate performance. Just having an observably diverse workforce doesn’t measure for that.
DEI Training Divides Not Unifies
DEI training programs have also come under scrutiny from academic researchers and found they can too easily do more harm than good in promoting empathy and workplace harmony.
In a study from the Network Contagion Institutes (NCRI) and Rutgers University that exposed students to anti-racist materials that are typically presented in DEI training found:
“The prominent ‘anti-oppressive pedagogy’ in DEI programming can carry perceived rhetorical threats for those whose politics or other beliefs run counter to the fundamental premises of the critical paradigm from which the pedagogy derives.”
In other words, such DEI training programs can increase hostility and exacerbate inter-group conflicts or as the researchers wrote, “Some DEI programs appear to backfire.”
Similar results were report by Professor David Haskell in a paper entitled “What DEI Research concludes about diversity training: it is divisive, counter-productive and unnecessary.”
He concluded, “When it comes to harmony and tolerance, DEI does not make things better, but can make things worse.”
Apparently, Walmart got the memo because the company claimed it was already reviewing its DEI policies before it got wind of Starbuck’s investigation into the company.
Walmart Or Target This Holiday?
For Starbuck’s anti-DEI campaign, his win with Walmart couldn’t come at a better time with the holiday shopping season shifting into high gear.
It will get the attention from retailers across the ideological spectrum to examine their DEI policies to determine whether they are working in the best interests of employees, the business at large and the communities they serve.
After successfully turning around DEI policies at Tractor Supply, Lowe’s, Harley Davidson, Ford and John Deere – he claims a 100% success rate in flipping company policies back to neutrality – Starbuck picked his next corporate target well.
Walmart’s customer base is more likely to lean toward his conservative perspective so it is not likely to lose the support of customers as a retailer like Target might, since it has been more outspoken on DEI issues.
At the same time, the WSJ reports that Target is still feeling the hangover from its Pride Month collection in 2023, which proved too progressive for many shoppers. Maybe Starbuck can’t come calling on Target soon enough.
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