A coalition of state Attorneys General sent a letter to Costco this week after the bulk grocery store chain’s leadership publicly doubled down on their diversity, equity and inclusion policies.
Costco’s shareholders voted to retain their DEI policies earlier this month. That decision came after President Donald Trump took a series of executive actions to shut off the flow of federal funds to DEI policies in the federal government, including government contractors.
Major companies around the country such as Meta, Walmart, McDonald’s, Target and others have cut back on their DEI programs in recent weeks.
But Costco is among the few publicly defying the trend. Costco board member Jeff Raike has publicly defended the company’s DEI policies, including in an op-ed in Forbes.
“Attacks on DEI aren’t just bad for business – they hurt our economy,” he wrote on X. “A diverse workforce drives innovation, expands markets, and fuels growth. Let’s focus on building a future where all talent thrives.”
Now, a coalition of state attorneys general have sent a letter to Costco saying it must “end all unlawful discrimination imposed by the company through diversity, equity, and inclusion (‘DEI’) policies.”
“Although Costco’s motto is ‘do the right thing,’ it appears that the company is doing the wrong thing – clinging to DEI policies that courts and businesses have rejected as illegal,” the letter said.
As The Center Square previously reported, Costco’s board pushed shareholders to vote to support DEI, a admonition they followed.
Iowa Attorney General Brenna Bird and Kansas Attorney General Kris Kobach led the letter, which said the policies violate the law.
The anti-DEI effort has been bolstered by a 2023 Supreme Court ruling against affirmative action policies on college campuses. The legal implications of that ruling, though, are mostly uncharted waters.
“Inexplicably, Costco has doubled down on DEI…” the letter added. “Costco’s position runs contrary to the Supreme Court’s recent decisions and raises concerns about Costco’s compliance with State and federal laws.”
Supporters of DEI have pushed back, calling on corporations to stand up to the Trump administration. But critics say DEI’s time is up.
“Costco is on a senseless mission to insult and antagonize its customers nationwide,” Will Hild, executive director of Consumers’ Research, said in a statement. “Its stubborn devotion to racist and outdated DEI practices not only hurts consumers, investors, and employees but also may be downright illegal…”
