Costco board rejects calls to dismantle DEI initiatives

Costco is at the center of a growing backlash from MAGA supporters after the retail giant rejected calls to dismantle its diversity, equity, and inclusion (DEI) initiatives.

The company's decision has brought it into the centre of the ongoing debate over corporate DEI policies, with right-wing activists urging boycotts and accusing Costco of prioritizing ideology over shareholder interests.

The dispute began when a group of shareholders, led by the National Center for Public Policy Research (NCPPR), proposed a report to assess the risks associated with maintaining DEI efforts. The shareholders described DEI programs as "illegal discrimination" and claimed they expose the company to legal and reputational risks. In response, Costco's board of directors defended the initiatives, citing their alignment with the company’s ethical code and commitment to inclusion.

“Our success at Costco Wholesale has been built on service to our critical stakeholders: employees, members, and suppliers. Our efforts around diversity, equity, and inclusion follow our code of ethics,” the board stated in a release. The leadership also accused the proposal’s proponents of harboring a “broader agenda” aimed at abolishing DEI policies altogether.

MAGA criticism

The rejection has drawn sharp criticism from prominent MAGA figures. Trump supporter Robby Starbuck, called for right-wing shoppers to boycott Costco, tweeting, “If they’re smart, Costco will do right by their shareholders and change before we turn our attention to them.”

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AJ Huber, another MAGA proponent, echoed the sentiment, writing on social media, “Boycott Costco! Cancel your membership! Nothing can stop We The People to Make America Great Again!”

The backlash comes as DEI initiatives face mounting scrutiny in corporate America. Conservative-led boycotts and state-level legislative actions have put pressure on companies to reconsider their approaches. The controversy also aligns with Project 2025, a policy platform backed by the incoming Trump administration that explicitly targets DEI practices for elimination.

Support for Costco

Civil rights advocates have rallied in support of Costco’s position. Nadine Smith, a prominent activist, commended the retailer, saying, “If you crumble when your values are tested, they weren’t values, they were marketing campaigns. Well done, Costco!”

Despite the criticism, Costco appears resolute. The board reiterated its belief that additional studies on DEI risks would not be a productive use of company resources. NCPPR’s Stefan J. Padfield, JD, director of its Free Enterprise Project, defended the campaign, arguing that DEI initiatives “institutionalize race discrimination” and pose risks to corporate value.

As the national debate over DEI intensifies, Costco’s stance has placed it at the forefront of the battle, with implications for its reputation and consumer base. The retailer’s response will likely shape how other corporations navigate the right-wing assault on workplace equity programs.