Proposal wants Costco to review risks of maintaining DEI roles, policies, goals
Its board of directors unanimously recommended a vote against a proposal from the National Centre for Public Policy Research that requested an evaluation and report on the risks of Costco maintaining its current DEI roles, policies, and goals.
But the board said in response that they believe their commitment to an enterprise rooted in respect and inclusion is "appropriate and necessary."
"The report requested by this proposal would not provide meaningful additional information to our shareholders, and the board thus unanimously recommends a vote against this proposal," the board said.
"We believe that the proponent's request for a study reflects a policy bias with which we disagree and that further study and reporting would not be an efficient use of company resources."
DEI withdrawal in US
The response is a stark contrast to other organisations in the United States, such as Tractor Supply and Harley-Davidson, that recently pulled back on their DEI policies due to conservative backlash.
Costco recently rebranded its DEI programme to "People and Communities," but has continued employing a chief diversity officer and maintains a supplier diversity programme.
"We welcome members from all walks of life and backgrounds," Costco's board said. "Among other things, a diverse group of employees helps bring originality and creativity to our merchandise offerings, promoting the 'treasure hunt' that our customers value."
Having a diverse supplier base is also beneficial for the organisation, according to the board.
"We believe that it fosters creativity and innovation in the merchandise and services that we offer our members."
Legality of DEI efforts
These programs were among the initiatives that the think tank picked on when it raised its proposal to Costco, which also pointed out the risk of discrimination among some groups.
"With 310,000 employees, Costco likely has at least 200,000 employees who are potentially victims of this type of illegal discrimination because they are white, Asian, male or straight," the proposal said.
"Accordingly, even if only a fraction of those employees were to file suit, and only some of those prove successful, the cost to Costco could be tens of billions of dollars."
But the board maintained the legality of the company's DEI efforts, stressing its commitment to evaluating the legal compliance of its practices.
"We believe that our diversity, equity and inclusion efforts are legally appropriate, and nothing in the proposal demonstrates otherwise," the board said. "Our focus on diversity, equity and inclusion is not, however, only for the sake of improved financial performance but to enhance our culture and the well-being of people whose lives we influence."
