DE&I in Challenging Times: Less Performance, More Strategy

I have been working with Diversity, Equity, and Inclusion (DE&I) in the corporate world for about ten years. During this time, I have seen companies that were just beginning to explore the topic, others that already had structured programs in place, and some that had gone as far as turning diversity into a strategic business priority.

I have also witnessed changes in language, approaches, priorities, leadership, investments, and, above all, expectations. And perhaps never before has the DE&I agenda, as we know it today within organizations, faced such a complex moment in its effort to remain relevant.

On the one hand, we have never had so much information, research, and evidence about the impact of diversity on organizations. On the other, we are witnessing a strong political and social backlash against this agenda, particularly in the United States, with repercussions around the world. Companies that, until recently, prominently displayed their public commitments to DE&I have begun reviewing programs, renaming initiatives, reducing investments, scaling back — or eliminating — targets, and/or simply talking less about the subject.

So the question should no longer be only: Will companies continue investing in DE&I? I believe there is a second question — and perhaps the more important one today: What kind of DE&I work will survive this moment?

Before trying to answer that, it is worth going back to basics. Diversity refers to the presence of people with different identities, experiences, perspectives, and characteristics within a given context. Equity means recognizing that people and groups start from different places and therefore need different conditions and opportunities to achieve outcomes. Inclusion is what happens when these people are not only present but are able to participate, contribute, be respected, develop, be at the center of decision-making, and feel that they belong.

It sounds simple, but it is not. Because DE&I is not simply about putting different people in the same room. It is about asking who is able to get into that room in the first place, who has a voice once they are there, who is heard, who advances, who leads, who receives opportunities, and who gets left behind — especially in times of crisis. It is also about understanding that when we make all of this happen in a positive way, people, society, and businesses can prosper and benefit together.

Why Did This Become a Business Issue?

For a long time, diversity was treated primarily as a social issue. Later, it also became a people issue, largely confined to HR and legal compliance. More recently, it has gained ground as a business priority. And there are good reasons for that.

An organization is made up of people and, at the same time, has an impact on people. It hires, compensates, promotes, dismisses, develops products, serves customers, selects suppliers, communicates values, and influences communities. Diversity, therefore, does not happen “outside” the business. It is embedded in the business.

A more diverse company can expand its access to talent, better understand different audiences, bring new perspectives to the table, and reduce bias in decision-making. In recent years, studies have shown associations between diversity and innovation, productivity, psychological safety, well-being, talent attraction, retention, and organizational performance. Access to diverse talent has also emerged among the practices considered most relevant for expanding the availability of professionals and accessing a broader pool of people with different competencies and skills.

That does not mean turning DE&I into an ROI* spreadsheet. In fact, that is an important distinction.

DE&I does not need to be defended solely because “it generates profit.” Ensuring opportunities, combating discrimination, and creating environments where people can work with dignity are also matters of rights, citizenship, and corporate responsibility. That is why it is important to reinforce that social justice can — and should — go hand in hand with business strategy and sustainability. An agenda can be good for people, society, and the company at the same time.

But the Landscape Has Changed

After a period of significant expansion, the corporate DE&I agenda has entered a phase of backlash — and retrenchment. In the United States, that backlash gained momentum through court decisions, pressure from conservative groups, political shifts, and, above all, Donald Trump’s return to the presidency.

In January 2025, Trump signed executive orders directing the termination of DE&I initiatives within the federal government and calling for measures against programs the administration characterized as “preferences or discriminatory practices in the private sector.” In other words, a deliberate attack on affirmative action.

The symbolic and practical impact was significant. Several companies, many of them U.S.-based multinationals, began reviewing or scaling back some of their policies and programs. In many others, a different phenomenon emerged: companies did not necessarily abandon the work altogether, but reduced their investments, renamed their DE&I functions, and/or became less vocal about the agenda and their initiatives.

An analysis by The Conference Board (DEI in Transition: 2025 Corporate Diversity Disclosure Trends, August 2025) found that 53% of S&P 100 companies — an index comprising 100 major publicly traded U.S. companies — adjusted their DE&I-related communications or organizational structures in their 2025 reporting. Use of the acronym “DEI” fell by 68% compared with the previous year, while 21% reduced or removed related metrics and targets.

This is what some have begun calling “silent DE&I”: companies that continue doing certain things but deliberately avoid using the terminology or making their commitments as public.

And What About Brazil?

It is important not to automatically import the U.S. context into Brazil. Our social, economic, legal, and historical realities are different. Brazil continues to face profound inequalities related to gender, race, disability, and other dimensions that directly affect the labor market.

Brazilian legislation itself already recognizes that some inequalities cannot be addressed solely through the “goodwill” of organizations. Law No. 14,611/2023, for example, requires companies with more than 100 employees to disclose salaries and compensation criteria in transparency reports submitted to the Ministry of Labor and Employment (MTE), subject to fines for noncompliance. When pay inequality is identified between men and women performing the same role, companies must develop an action plan to address it, including goals and deadlines.

Likewise, since 1991, Brazilian legislation has required companies with 100 or more employees to reserve positions for people with disabilities and rehabilitated beneficiaries under Law No. 8,213/1991, commonly known as the Quota Law. The required percentage ranges from 2% to 5%.

Another relevant point in the world of work is understanding that affirmative action is not merely permitted but recognized under the Brazilian legal framework. According to the Ministry of Labor and Employment, affirmative action does not constitute discrimination; rather, it is a legitimate instrument for promoting equal opportunities and addressing existing inequalities in the workplace. Companies may therefore voluntarily adopt affirmative action measures aimed at reducing inequalities present in society or within their own organizations.

In other words, DE&I in Brazil is not simply an imported trend, much less a passing issue created by HR departments. It is connected to Brazil’s own reality and, across different dimensions, to rights, legislation, labor relations, and corporate responsibility. And the data shows that there is still a great deal of work to be done.

DE&I Cannot Depend on Anyone’s Benevolence

Perhaps this is what concerns me most when I look at recent developments. If a company treats diversity as a voluntary project, dependent on the sensitivity of a particular leader, the enthusiasm of a particular department, or the availability of budget at a particular moment, the agenda will always remain vulnerable.

And this brings us to an important distinction: having occasional, isolated DE&I initiatives is one thing. Having an institutional DE&I agenda is another.

An initiative might be a talk during Black Consciousness Month. A campaign during LGBTQIAPN+ Pride Month. A women-in-leadership program. An employee resource group. A hiring initiative for people with disabilities. All of these can be important. But none of them, in isolation, guarantees cultural transformation.

Throughout my decade-long career as a consultant, I have increasingly come to realize that the question we need to ask is not simply “What is the company doing?” but rather “How does this company organize, sustain, advance, measure, and create accountability for this agenda?”

This is where three words I consider fundamental come into play: Governance, Strategy, and Management.

Governance addresses, among other things, how the agenda is organized, where decisions are made, who oversees it, who is accountable for it, and how it connects to the organization’s power structure.

Strategy helps answer why the company is doing this work, what its priorities are, where its most significant challenges lie, and how DE&I connects to the business and its culture.

Management turns intention into practice: goals, indicators, processes, budgets, leadership development, recruitment, promotion, compensation, communication, suppliers, and so many other elements of organizational life.

I like to use a simple analogy: a company can have a fantastic car. It can have a powerful engine, advanced technology, comfort, and every resource available. But if it does not know where it is going, does not have a reliable GPS or map, and no one is actually driving, it is unlikely to reach its intended destination.

DE&I works in much the same way:

Governance is the car that provides the structure, safety, and support needed to make the journey possible.
Strategy is the GPS that helps define the destination and the route.
Management is the driver — the element that turns planning into movement, makes things happen, and adjusts the route when necessary. And indicators are like the dashboard: they show speed, fuel levels, temperature, and warn us when something is not working.

It is not enough to accelerate. We need to know where we are going.

So How Do We Know Where to Start?

One of the tools I have been developing with Thays Toyofuku emerged precisely from this need: the DE&I Maturity Map.

The idea is simple, although its implications are significant: before deciding on the next actions, it is important to understand where the organization currently stands. Different companies need different choices.

An organization that does not yet have basic policies, data, or a governance structure should not receive exactly the same recommendations as a company that already has goals, indicators, employee resource groups, development programs, and public commitments.

Maturity is not a competition to determine who is “more inclusive.” The goal is not to create a ranking. It is a tool for understanding the current stage and making smarter decisions about what comes next. And this becomes even more important in moments of pressure.

When the environment becomes more challenging, organizations should not simply abandon their agendas. They should return to their foundations and corporate identity — their vision, mission, and values. They should assess risks, understand their data, revisit priorities, gain a clearer understanding of their core, and strengthen what genuinely creates sustainable transformation within the business while taking today’s society into account.

Perhaps that is the major opportunity hidden within the current DE&I crisis.

For several years, many companies were encouraged to ask: “What do we need to do to demonstrate our commitment to diversity?” Now, we need to ask a more sophisticated question: “What do we need to build so that this commitment can survive changing circumstances?”

One answer that comes to mind after all these years of experience: Less performativity. More strategic consistency.

I believe the future of DE&I within organizations lies in an agenda that is less dependent on trends and more connected to strategy. Fewer isolated actions and more processes. Less rhetoric and more evidence. Less dependence on one person who is passionate about the subject and more institutional accountability. Less “let’s do this because it’s the month of…” and more “let’s do this because this is part of how our company operates.”

That does not mean abandoning communication, campaigns, celebrations, or awareness-building. Quite the opposite. They remain important for generating conversation, visibility, and belonging. But they need to be connected to something larger.

Because there is little value in celebrating diversity on a company’s social media channels if diversity is absent from its leadership. There is little value in talking about equity if promotion criteria continue to reproduce inequalities. There is little value in celebrating LGBTQIAPN+ Pride in June if those same people lack psychological safety during the other eleven months of the year. There is little value in hiring people with disabilities simply to comply with legislation if the company does not ensure accessibility, development, and career opportunities. And there is little value in creating employee resource groups and expecting them to bear sole responsibility for transforming the entire organizational culture without leadership support, budget, or sufficient time to act amid the competing pressures of the business.

DE&I is the responsibility of the organization: of employee resource groups and the Human Resources, Communications, Compliance, Technology, Procurement, Sustainability, and many other functions, yes. But also — and above all — of leadership.

If I may take a somewhat more positive view, I would say that perhaps the agenda is not dying. Perhaps it is maturing. There is clearly a real movement of retrenchment in certain markets. Denying that would be naive. But it would be equally naive to conclude that the entire agenda is disappearing.

The international landscape itself, as I have already discussed, reveals a more complex reality. Some companies are scaling back programs, others are redesigning them, some are becoming quieter, and others are maintaining their commitments.

Perhaps, then, we are entering a new phase. The first phase was about proving that diversity mattered. The second was about creating programs, commitments, and structures. Now we need to prove that those structures can produce real change — including when the external environment is no longer favorable.

And that requires maturity. It requires the courage to look at the data. It requires a willingness to acknowledge that some initiatives did not work. It requires leadership. It requires strategy. It requires governance. And it requires management.

Because DE&I cannot simply be an agenda that a company supports when supporting it is easy. It is precisely when things become difficult that we discover whether it truly forms part of the culture.

Perhaps the future of diversity in business is not about speaking louder. Perhaps it is about building deeper.

And in that sense, I remain optimistic. Not with the naive optimism of someone who believes that good intentions alone can transform organizations, but with the optimism of someone who, after a decade of closely following this agenda, knows that cultural change does not happen overnight.

It happens when different people are able to occupy spaces that were previously inaccessible to them. When leaders begin making decisions differently. When processes stop reproducing inequalities. When data stops being merely numbers and starts guiding decisions. When responsibility stops being concentrated in the hands of a few people and becomes embedded throughout the organization. And when diversity stops being treated as “a topic” and starts being recognized for what it actually is: a dimension of how we build organizations that are fairer, more human, more sustainable, more competitive, more innovative, and better prepared for the real world.

The real world, after all, is diverse. Society is diverse. Consumers are diverse. Talent is diverse. The problems companies need to solve are diverse — and complex.

Perhaps the question was never whether organizations should deal with this diversity. The question is how they will choose to do so.

And at this moment, more than ever, I believe the path forward lies in transforming DE&I from an agenda of intention into an agenda of Governance, Strategy, and Management — with purpose, accountability, indicators, and, above all, the ability to keep moving forward even when the road becomes more difficult.

Because a good journey does not depend solely on having a car. You need to know where you are going, have a reliable map, and, above all, have someone willing to drive.

Who’s coming along for the ride?

* ROI (Return on Investment) is a financial metric that measures the profit or loss a company generates relative to the amount invested in an initiative, project, or business.