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Is corporate commitment to DEI declining? Investment has dropped, budgets have been cut, comms support is down—but why?

by | Nov 2, 2023 | Public Relations

There are countless reasons why 2020 was the worst year of our lifetimes but, even though it cost a man his life and brought his family heartache, at least one beneficial thing came out of it: the seething anger after the tragic murder of George Floyd by the hands of a police officer spurred a social justice activism movement around the country and globe that, among many other things, put a spotlight on the diversity and inclusion policies and conditions of American workplaces. Business leaders soon committed to the DEI mandate and a worldwide focus on these issues within organizations was kickstarted.

But three years later, this hot-button issue seems to be cooling off in the business world, as the DEI pendulum has begun a swing downward from its high point of corporate adoption. In 2023, internal comms and employee engagement consultancy ROI Communication is seeing a 55-percent reduction in requests for DEI-related communication support year over year. The ongoing DEI work that the firm supports its clients with has seen budget reductions upwards of 30 percent, almost double the reduction compared to the average of 15 percent for other employee-focused work expected in a churning marketplace.

Is corporate commitment to DEI declining? Investment has dropped, budgets have been cut, comms support is down—but why?

Companies in the US are feeling the multi-prong effects of the SCOTUS rulings striking affirmative action in college admissions, a downward-trending tech market that has led to waves of layoffs, and increased political polarization that has given rise to extremely visible consumer backlash, particularly in the LGBTQ+ space.

More specifically, hiring for the position of Chief Diversity Officer (CDO) has declined, tenure rates for CDOs are now a third of their C-suite counterparts, and DEI roles have a 1 in 3 chance of turnover, which is 12 percent higher than non-DEI roles.

Despite the broad-stroke downturn, the firm found that DEI sentiment and support remains steadfast and consistent, particularly in companies with DEI foundations prior to 2020. Those organizations have the benefit of having weathered previous marketplace downturns while understanding DEI as a key component to innovation and marketplace edge, particularly in the technology and energy sectors. 

The firm asserts that it’s critical to make visible progress at the leadership level as it remains an important factor in the perceived success of DEI initiatives

During a recent DEI survey for a client, a common employee-vocalized theme was summed up: “It doesn’t matter what you say. If we don’t see the leadership stats becoming more diverse, it doesn’t matter what the communications are.”

Predictions for trends in the DEI space in 2024 include:

  • CDOs will narrow their focus and lean into data and metrics to showcase progress against specific objectives.
  • Reduced DEI roles will resurface as functions within departments such as HR, Product Development, and Recruiting.
  • Companies will undergo a regrouping and restructuring of publicly stated DEI goals.
  • There will be a reduction of ERG and community engagement financial commitments.

Richard Carufel
Richard Carufel is editor of Bulldog Reporter and the Daily ’Dog, one of the web’s leading sources of PR and marketing communications news and opinions. He has been reporting on the PR and communications industry for over 17 years, and has interviewed hundreds of journalists and PR industry leaders. Reach him at richard.carufel@bulldogreporter.com; @BulldogReporter

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