Here's why Costco will eventually drop DEI, says activist investor

Shareholder Proposal and DEI Policies - Costco shareholders overwhelmingly rejected a challenge to the company's diversity, equity, and inclusion (DEI) policies, with 98% voting against the proposal [1][4] - The National Center for Public Policy Research's Free Enterprise Project (NCPR) had made a bid for Costco executives to investigate the risks of DEI policies to the company's bottom line, but the board of directors unanimously opposed the effort [3][5] - Costco Chairman Hamilton "Tony" James emphasized the importance of inclusivity and appreciation for employees, stating that these values are transmitted to customers [4] Industry Trends and Comparisons - Costco remains a high-profile holdout from the trend of companies rolling back or abandoning DEI policies, which include considerations of race and gender in hiring and workplace diversity training [7] - NCPR's Ethan Peck predicts that Costco may follow the path of companies like Walmart, McDonald's, and Harley-Davidson, which dropped DEI policies during President Donald Trump's administration [5][6] - Peck cited Boeing as an example, noting that it opposed a shareholder proposal for a DEI audit before eventually dropping DEI initiatives [6] Leadership and Advocacy - Costco board member Jeff Raikes, former CEO of the Bill & Melinda Gates Foundation, is a vocal supporter of DEI policies, advocating for businesses to maximize their DEI initiatives [7] - Raikes argued that attacks on DEI are detrimental to business and the economy, emphasizing that a diverse workforce drives innovation, expands markets, and fuels growth [8] Political Context - President Donald Trump has criticized DEI as "discriminatory" and "absolute nonsense," issuing executive orders to ban DEI in the federal government [9]