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Costco board of directors is urging shareholders to vote against a proposal that would eliminate the wholesale retailer’s diversity, equity and inclusion (DEI) program.
“Our success at Costco Wholesale is based on serving our key stakeholders: employees, members and suppliers. Our efforts around diversity, equity and inclusion follow our Code of Conduct: For our employees, these efforts are built around inclusion are – which includes ensuring that all of our employees feel valued and respected,” the board of directors wrote in a message to investors as previously reported. Hill. “Our diversity, equity and inclusion efforts remind and reinforce the importance of creating opportunities for everyone at our company. We believe these efforts enhance our ability to attract and retain the employees we need. who will help make our business successful. This capability is important as we attribute our success to our more than 300,000 employees around the world.”
The message was sent ahead of Costco’s annual shareholders’ meeting scheduled for January 23, 2025.
Shareholders will vote on a resolution brought by the National Center for Public Policy Research challenging the legality of Costco’s DEI program following the Supreme Court decision. SFFA vs. Harvard Discriminating on the basis of race in college admissions violates the Equal Protection Clause of the 14th Amendment.
The motion details how attorneys general from 13 states have warned Fortune 100 companies that the decision would impact corporate DEI programs and have filed multiple lawsuits.
Customers enter Costco Wholesale Corp’s warehouse store on June 12, 2024 in Hawthorne, California. (Patrick T. Fallon/AFP via Getty Images/Getty Images)
The proposal notes that companies that have withdrawn DEI commitments and/or laid off employees from DEI departments include Alphabet, Meta, Microsoft, Zoom, and John Deere, although Costco’s board says Microsoft later clarified that it had eliminated two redundant DEI roles, yet its focus on diversity and inclusion “remains unwavering.”
The National Center for Public Policy Research wrote in its shareholder proposal, “And yet Costco still has such a program, though it was understandably reluctant to recognize it because it recently quietly renamed its DEI program as ‘People and Communities. ‘Given the name. “But slapping a new label on discriminatory practices does not protect Costco and its shareholders from these risks.”
The Foundation condemned that Costco’s changed program still openly expresses “Commitment to equality,“Which argues that this means equality of outcome, not opportunity – and the company still employs a “Chief Diversity Officer”, still has a supplier diversity program that selects suppliers based on their race and gender. , yet it appears to take race and gender into account in hiring and promotions “and still contributes shareholder money to organizations that advance DEI’s discriminatory agenda.”
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Customers wait in line to checkout at a Costco store in Novato, California on December 11, 2024. (Justin Sullivan/Getty Images/Getty Images)
The motion argues, “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.” “Accordingly, even if only a portion of those employees file a lawsuit, and only a few of them prove successful, the cost to Costco could be tens of billions of dollars.”
Despite the Supreme Court’s decision, Costco’s board of directors insisted that its DEI practices “are legally justified, and nothing in the proposal demonstrates otherwise.” The board also claimed that the National Center for Public Policy Research’s request for a study of Costco’s DEI practices “reflects policy bias” and threatens to overburden the company’s resources.
Citing a 2023 federal district court decision, the board argued that the National Center for Public Policy Research’s “broad agenda is not mitigating risk to the company but eroding diversity initiatives.” The board claims the foundation is continuing its “shareholder activism”, noting how the National Center for Public Policy Research has previously expressed a commitment to fighting “against the evils” awakened political capital And companies.”
A Costco store in Richmond, California on July 11, 2024. (Justin Sullivan/Getty Images/Getty Images)
Costco’s board defended its DEI practices, writing, “We welcome members from all walks of life and backgrounds. As our membership diversifies, we believe that with a diverse group of employees “Service increases satisfaction.” “Having diversity in our supplier base, including a fair focus on small businesses, is beneficial for the same reasons that diversity benefits our company. We believe it improves the quality of the goods we provide to our members. and promotes creativity and innovation in services.”
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Fox News Digital contacted Costco and the National Center for Public Policy Research for additional comment.
“DEI is a redistribution of opportunity for employees, potential employees, and suppliers based on race and gender,” Ethan Peck, deputy director of the Free Enterprise Project at the National Center for Public Policy Research, said in a statement. “This is not only unethical, it is illegal, and carries the risk of future litigation. It also comes with a sacrifice of merit – and therefore excellence and innovation (which the company owes to shareholders to maximize to the best of its ability.” fiduciary duty)—but changes of an arbitrarily determined variety.”
