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In an August webcast on this site and PracticalESG.com, legal & DEI experts joined us to explain what leaders of corporate DEI programs should be doing following the June SCOTUS decision in Students for Fair Admissions v. Harvard. This Wolters Kluwer article gives an updated look into how DEI website messaging is – and isn’t – changing at companies targeted by litigation in the past few months.

The updated language tends to replace references to specific minority or underrepresented groups with more general references to diverse or marginalized communities. The article notes that at least one company continues to list numerical representation goals on its website.

In our webcast, Orrick’s J.T. Ho walked through applicable legal frameworks & predicted that pressure on DEI programs is ultimately going to result in better disclosure. Here’s an excerpt:

Ultimately, a lot of the companies that we’re talking about here are Delaware corporations and they have a duty to their shareholders to increase value and everything else. There’s a good argument that a lot of the initiatives that are currently in place do a lot toward enhancing shareholder value. Human capital is an important resource. It’s an asset that has a lot of value, is intangible in nature and hard to quantify. It’s important to attract, retain and train a qualified workforce, and diversity is a big part of that. If companies look within themselves and think about their key priorities from a business perspective, they will see that DEI is probably one of them.

With that in mind, building programs that enhance and create value is key. Doing it in a way that complies with the law is all you need to be thinking about and not so much, “Let’s ignore these programs altogether. Let’s not do them.” As long as you’re thinking about it in terms of what ultimately matters from a corporate fiduciary standpoint and an employment lens and doing what you think ultimately is right for the business, and being thoughtful and careful in that approach, I think companies are going to be OK.

The question was, what can you say to bolster confidence? That’s what I would say. I think that over time, we’re going to see these programs become better disclosed. They’re going to be created in a way that’s more thoughtful from a legal perspective. Ultimately, we’re all just going to see that a few years from now, there is going to be a significant impact on shareholder value. I think that’s going to be a big focus for shareholders going forward from an institutional perspective, regardless of what the political climate is going to be.

Check out the full transcript for more commentary & practical tips. If you aren’t already a member with access to that transcript, sign up online or email sales@ccrcorp.com.

– Liz Dunshee