Walmart is the largest retailer to roll back diversity policies. What might it mean for Canadian employees?

Walmart, the world’s largest retailer, is rolling back its diversity, equity and inclusion policies, joining a growing list of major corporations that have done the same after coming under attack by conservative activists.

The changes, confirmed by Walmart on Monday, are sweeping and include not renewing a five-year commitment for a racial equity centre set up in 2020 after the police killing of George Floyd — nor will the company continue to use race and gender as a litmus test to improve diversity when it offers supplier contracts. Walmart said it didn’t have quotas and will not do so going forward.

The changes come soon after an election win by former President Donald Trump, who has criticized inclusion initiatives and surrounded himself with conservatives who hold similar views, including his former adviser Stephen Miller, who leads a group called America First Legal that has challenged corporate diversity policies. Trump named Miller to be the deputy chief of policy in his new administration.

A Walmart spokesperson said some of its policy changes have been in progress for a while. For example, it has been moving away from using the term “DEI” — diversity, equity and inclusion — in job titles and communications and started to use the word “belonging.”

Walmart Canada did not reply to questions when contacted by CBC News about what impact these changes would have in Canada.  

‘More of this in Trump’s America’

Still, the news raised concerns about a potential trickle-down effect the U.S. policy changes could have on Canadian employees of the company. 

Scott Knox, president of Toronto-based Pride AM, 2SLGBTQ+ group for the advertising and marketing industry, said he’s concerned the Canadian arm of Walmart may have a hard time taking an independent stance — and he also noted the move by the company’s U.S. leadership is not a surprise. 

The marketing sector has seen examples of recent cuts to 2SLGBTQ+ specific advertising, he said. 

“Over the past couple of years, we’ve seen the rollback of [diversity and inclusion policies] and it really began with things like spending on Pride and other initiatives,” he said, citing how Bud Light’s sales dipped when it featured a transgender TikTok star. 

“I think we can expect more of this in Trump’s America, and actually we can expect the ‘knock on effect’ in other countries around the world,” he added.

Increasing backlash and legal battles also a factor

Walmart’s move also underscores the increasing pressure faced by corporate America as it continues to navigate the fallout from the U.S. Supreme Court’s ruling in June 2023 ending affirmative action in college admissions. 

It had already started making changes to its  supplier program in the aftermath of that ruling, meaning that diversity is no longer a factor in a supplier’s favour when it comes to working with Walmart. 

Emboldened by that court decision, conservative groups have filed lawsuits making similar arguments about corporations, targeting workplace initiatives such as diversity programs. 

Separately, conservative political commentator and activist Robby Starbuck has been going after corporate diversity, equity and inclusion policies, calling out individual companies on the social media platform X. Several of those companies have subsequently announced that they are pulling back their initiatives, including Ford, Harley-Davidson, and Lowe’s. 

But Walmart, which employs 1.6 million workers in the U.S., is the largest one to do so.

“This is the biggest win yet for our movement to end wokeness in corporate America,” Starbuck wrote on X, adding that he had been in conversation with Walmart.

But Nicole Antoine, co-founder of an employment and networking conference that connects Black professionals with companies recruiting new talent, said she hopes Walmart Canada sees diversity policies “as a business advantage” and not “just a moral imperative.” 

“I think Canada’s multicultural fabric demands thoughtful and genuine [diversity and inclusion] efforts,” said the BLAXPO co-founder and Montreal-based entrepreneur. “Especially from a leading employer like Walmart.”

Pride event sponsorships under review

The Bentonville, Arkansas-based retailer will also be reviewing grants to Pride events, saying it is doing so to make sure it is not financially supporting sexualized content that may be unsuitable for kids. 

Walmart says its U.S. businesses sourced more than $13 billion in goods and services from diverse suppliers in fiscal year 2024, including businesses owned by minorities, women and veterans.

Walmart also said it wouldn’t renew a five-year, $100-million philanthropic commitment to a racial equity centre for addressing problems “experienced by Black and African American people in education, health, finance and criminal justice systems,” according to its website.

“We’ve been on a journey and know we aren’t perfect, but every decision comes from a place of wanting to foster a sense of belonging, to open doors to opportunities for all our associates, customers and suppliers,” the company said in a statement.

How might Walmart Canada approach equity and inclusion?

David Ian Gray, a veteran retail consultant with Vancouver-based DIG 360, said he’s hopeful that Walmart Canada will be able to chart its own path on equity and inclusion.     

Employment equity programs have been losing momentum recently, Gray said, in some cases because of cumbersome designs, or because companies say they’ve met current objectives.    

“I think the leadership in Canada has proven in the past that they could stand aligned, apart from the U.S. parent,” he said, adding that it won’t be easy. 

“I think the problem is rooted in society,” he said. “It’s not a retailer problem, but retailers serve society, and they employ society — so this is the heart of difficult leadership.”