DIY DEI

Companies are increasingly reconsidering their diversity, equity and inclusion positions as a new administration takes power with a pledge to dismantle diversity initiatives.

Some companies are now flagging DEI as a risk, a pendulum swing from recent years when diversity initiatives grew amid a push in the wake of George Floyd’s murder. BlackRock Investment Stewardship is out with 2025 global proxy voting guidelines which include a pared back approach to board diversity. And McDonald’s became the latest major corporation to roll back its goals yesterday. 

On the other side, the Human Rights campaign is out this week with its 2025 Corporate Equality Index, which has become a lightning rod in the debate. While some prominent companies are no longer participating, many others are touting their high scores this week, showing corporate positions are all over the map. 

How companies talk about DEI in their upcoming annual reports will be a key inflection point around this issue. Costco recently put out proxy materials defending its DEI policies against an activist shareholder proposal, saying, “We believe that these efforts enhance our capacity to attract and retain employees who will help our business succeed.” 

As we’ve covered in previous editions, views around DEI are starkly divided along partisan lines and we advise a thoughtful approach to reviewing policies and sticking to your values.

Canadian Prime Minister Justin Trudeau has announced his intention to step down following the election of a new leader for the Liberal Party of Canada (LPC). During this period of transition and uncertainty in Canadian federal politics, our colleagues at FGS Longview advise organizations should brace for delays in decision-making and a more cautious approach from federal departments.

With Parliament suspended until March 24, all legislative activities have been paused. When Parliament returns, the Liberal Government will outline future priorities in a Speech from the Throne, followed by a vote.  A failure to pass this vote, or the government funding vote that is needed in March, would trigger an election. 

During this period, the government is expected to operate on a “caretaker” basis, meaning it will be less inclined to consider new projects or initiatives. Sensitive or potentially controversial matters will likely be deferred, but  urgent issues–like potential U.S. tariffs–will remain a priority. 

Organizations with active matters before the Government of Canada need to assess whether and how they can continue to move forward in light of this latest disruption. Much will depend on whether key ministers remain in their posts during a leadership race. We will continue to monitor these developments closely and provide updates as more information becomes available.

With President-elect Trump’s inauguration less than two weeks away, the new administration is expected to act quickly to implement its top priorities, including:

• Tariffs: During his campaign, Trump proposed a 20% tariff on all imported goods and a 60% tariff on goods from China. Post-election, he threatened to impose a 25% tariff on goods from Canada and Mexico unless they address drug trafficking and migration. Some see this as a negotiating tactic, but there is uncertainty about the tariff implementation and eventual targets.

• Immigration: Trump is expected to use executive orders to enforce a more restrictive immigration policy, including mass deportations of 11 million unauthorized immigrants. While feasibility and cost of a large-scale deportation program has been questioned, Trump is clearly serious about pursuing this policy, potentially impacting industries like housing, construction, manufacturing, agriculture, transportation and hospitality.

• Tax cuts: Trump aims to extend individual tax cuts from his first term and has proposed lowering the corporate tax rate from 21% to as low as 15%. Unlike tariffs and immigration, tax cuts require congressional legislation. To avoid a Senate filibuster, tax cut legislation will move through the reconciliation process, which is complicated and takes time. Funding for the tax cuts is unclear, but Republicans may argue growth, tariff revenue and savings from the DOGE spending recommendations will offset costs.

• Energy: Trump promised to “drill baby, drill” to lower oil and gas prices and combat inflation. The GOP supports an “all of the above” energy policy, backing oil and gas production along with other domestic energy forms. Using executive authority, Trump plans to roll back incentives for electric vehicles, restart liquid natural gas export permits, open more land for drilling and relax environmental regulations.