As DEI Fades from Filings, Smart Leaders Rethink the Strategy

In boardrooms and legal departments across corporate U.S., a quiet shift is underway. Where diversity, equity, and inclusion (DEI) was once a regular fixture in corporate reporting, it is now becoming conspicuously absent — particularly in formal public disclosures. 

According to a recent analysis by The Washington Post, mentions of DEI in S&P 500 companies’ annual 10-K filings fell sharply from an average of 12.5 in 2022 to just 4 in 2024 — the lowest since 2020, when disclosures surged in response to investor pressure and heightened public scrutiny following the murder of George Floyd. 

Even as public messaging around DEI retreats, the internal landscape remains fraught with complexity. Nearly half of U.S. workers (47%) said their organization’s inclusion and diversity efforts are effective or very effective, according to research conducted for the 2025 SHRM State of the Workplace report. Yet, HR professionals also reported growing uncertainty. Most (61%) said they believe recent executive orders will weaken DEI programs, and 45% said those changes will make their jobs slightly more difficult or much more difficult, according to additional SHRM research. 

Meanwhile, 55% of CHROs said they anticipate that companies will scale back or eliminate DEI initiatives altogether in 2025, according to SHRM’s CHRO Priorities and Perspectives report. These shifts point to a workplace environment in which expectations remain high, but confidence in outcomes — and clarity on how to move forward — is wavering. 

This trend reflects more than just a change in language — it marks a critical inflection point. As legal scrutiny intensifies and the public narrative around DEI evolves, the decline in corporate disclosures signals not just a rejection of inclusion itself, but the need for more strategic, legally attuned approaches.

In this shifting environment, senior leaders face an urgent question: How do you continue building inclusive and high-performing organizations in an environment that is suddenly less forgiving of how those intentions are framed — or even perceived?

The Legal Landscape Has Shifted

For decades, HR leaders and legal counsel anchored their DEI efforts around Title VII of the Civil Rights Act, which prohibits intentional discrimination in employment decisions. These protections gave organizations confidence to pursue inclusion and diversity efforts, as long as initiatives and actions were not overtly discriminatory.

But that paradigm is now in flux. A recent executive order issued by the Trump administration — "Restoring Equality of Opportunity and Meritocracy” — has deprioritized enforcement of disparate-impact claims, which have long been used to challenge seemingly neutral policies that disproportionately affect certain groups. In their place, the focus is shifting back to cases of explicit, intentional discrimination.

The change also brings into sharper focus the Equal Protection Clause — a constitutional principle that applies primarily to public institutions and, increasingly, to federal contractors. For many in HR, it’s unfamiliar legal terrain. In the words of one CHRO I recently spoke with, “For years, we followed Title VII and didn’t worry much about the Equal Protection Clause. It looks like now we may have to."

The result? DEI can no longer rely on old assumptions. Leaders need new frameworks that meet the moment — legally, culturally, and operationally.

What This Means for Midmarket Leaders

Unlike the Fortune 100, midmarket companies lack the vast legal infrastructure and brand insulation needed to navigate ambiguity or controversy without impact. Yet, they face the same talent market expectations — especially from younger, values-driven workers — to foster inclusive cultures.

Simply deleting DEI from public filings or downplaying public commitments carries real risks. It could alienate employees, confuse stakeholders, and erode a sense of belonging. On the other hand, clinging to outdated or overly politicized language without legal foresight could invite scrutiny, federal oversight, or consequences to potential business outcomes.

The solution isn’t to retreat, but to reframe.

Enter BEAM: A Smarter Path Forward

This is where SHRM’s BEAM Framework — Belonging Enhanced by Access through Merit — becomes invaluable. BEAM offers a contemporary, legally sound, and business-centric approach to workplace inclusion.

The Four Core Principles of BEAM

1. Merit as the Primary Lens.

Organizations should anchor talent decisions in measurable skills and job-relevant performance — not proxies that suggest preferential treatment. A skills-based approach helps minimize unconscious bias and ensures that hiring and promotion decisions reflect real potential contributions.

2. Access over Identity.

To build stronger pipelines, companies must expand their reach to include overlooked and nontraditional talent sources such as vocational training programs, apprenticeships, and upskilling platforms. Partnering with community-based organizations can help identify individuals with the skills and drive to succeed, regardless of background.

3. Continuous Calibration.

Inclusion isn’t one-and-done. Leaders must use performance data and feedback loops to regularly assess and refine their talent practices. This ongoing calibration helps detect and address systemic barriers that may emerge in hiring, retention, development, or advancement.

4. Operationalizing Inclusion.

Inclusion must be woven into the fabric of business operations, not siloed as a standalone initiative. That means adopting a skills-first strategy and leveraging artificial-intelligence-powered tools that match capabilities to business needs while safeguarding against bias.

Why BEAM Is a Business Advantage

Inclusion is more than just a moral principle — it’s a critical business imperative. The BEAM Framework aligns with findings from McKinsey & Company’s Diversity Matters Even More report, which underscores that fostering inclusive environments — in which every employee feels valued and empowered — drives stronger business outcomes and organizational success. Here are some key findings from the report:

• 36% to 48% higher profitability: Companies in the top quartile for gender and ethnic diversity significantly outperform their less-inclusive peers.
• 53% higher customer satisfaction: Inclusive teams, especially in consumer-facing industries, build stronger customer connections.
• Up to 40% improvement in engagement scores: Companies that prioritize inclusion foster stronger employee loyalty.
• 25% lower turnover and 21% higher productivity: Inclusive workplaces engage employees who feel seen and valued.

As the business case for inclusion grows stronger and the legal landscape grows more complex, passive support is no longer enough. Organizations need leaders who can translate principles like those in BEAM into actionable strategies — leading with precision, transparency, and a long-term view.

Leadership Priorities for 2025 and Beyond

For CEOs, CHROs, and boards, this moment requires nuance and resolve. Here’s how to lead with clarity:

1. Conduct a Strategic Audit of Language and Programs 
Reassess current public statements, filings, and initiatives. Ensure alignment with evolving legal standards and company values without over-indexing on politicized terms. In particular, stay clear of programs or initiatives that are illegal or discriminatory or that provide preferential treatment to any class of people.

2. Train Leaders to Speak and Act with Precision 
Equip managers to foster inclusive environments using practical language that reflects BEAM principles. Shift from abstract concepts to tangible behaviors.

3. Maintain — and Evolve — Your Commitments 
Many CHROs are not walking away from DEI — they’re recalibrating. Even as language shifts in public disclosures, internal priorities remain. Focus on sustaining progress through the lens of merit-based opportunity, with an emphasis on belonging and performance-driven advancement.

4. Monitor for Unintended Consequences 
Even as disparate-impact liability is deprioritized federally, private lawsuits, state laws, and reputational risks remain. Build defensible, transparent decision-making processes.

5. Communicate Internally with Purpose and Confidence 
Employees want clarity. Share your vision and explain why your approach is evolving, reinforcing that inclusion remains central to your growth and culture.

Inclusion Is Not Optional — but How You Frame It Matters 

The shift in public disclosures and the evolving legal landscape reflect less a rejection of inclusion and more a demand for more thoughtful, strategic approaches. Leaders who sidestep political polarization and anchor their strategies in performance, fairness, and merit will be best positioned to attract and retain top talent, foster innovation, and drive business results.

The language may be changing, but the imperative remains. HR must unlock the full potential of every employee to ensure businesses — and the communities they serve — thrive. 

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Alexander Alonso, Ph.D., SHRM-SCP, is SHRM's  chief data and analytics officer leading intelligence, insights, and innovation function