Shareholders at Walmart (WMT) and PayPal (PYPL) voted Thursday to reject proposals aimed at reshaping the companies’ approaches to diversity, equity, and inclusion (DEI), signaling a continued shift in corporate America away from contentious social and political matters.
At Walmart, shareholders voted down a series of proposals targeting the retailer’s DEI efforts. Similarly, PayPal investors overwhelmingly rejected a measure that would have required the company to evaluate the risks associated with its charitable donations.
One anti-DEI proposal at Walmart, submitted by the National Center for Public Policy Research’s Free Enterprise Project (FEP), called on the board to explain why it delayed changes to its DEI programs until after vocal criticism from DEI opponent Robby Starbuck. The group also accused Walmart of simply rebranding, rather than dismantling, its DEI initiatives.
At PayPal, FEP requested greater transparency into how its charitable contributions might affect company risk—pointing to affiliations with groups like the Human Rights Campaign, which they say could raise concerns over discrimination based on speech or religious beliefs.
Walmart has already faced internal backlash over scaling back its DEI programs. Earlier this year, more than 30 investors managing a collective $266 billion in assets expressed disappointment to CEO Doug McMillon, calling changes to the retailer’s DEI strategy “very disheartening.”
Late last year, Walmart moved to reduce its diversity programming and announced it would stop using the term “DEI” altogether.
Despite that, some shareholders pushed for stronger diversity commitments. Advocacy group United for Respect encouraged investors to support a proposal focused on improving racial equity and inclusion, stating that Walmart had not adequately addressed “the need of [a] diverse workforce.”
However, Walmart’s corporate secretary Rachel Brand urged shareholders to reject the proposal.
“We do not make employment decisions on the basis of race or gender,” she said, emphasizing that Walmart hires broadly and that its diversity is reflected in its public data.
This year, a growing number of companies have faced proposals from both critics and supporters of DEI. Some, like Alphabet (GOOG, GOOGL), Meta (META), McDonald’s (MCD), Amazon (AMZN), JPMorgan Chase (JPM), Target (TGT), and Tractor Supply (TSCO), have chosen to scale back or adjust their public DEI commitments.
Additional shareholder votes on DEI measures are scheduled this week at Netflix (NFLX) and Alphabet.
Tractor Supply, for example, is seeking to exit the DEI debate entirely. CEO Hal Lawton told Yahoo Finance on Wednesday that the company’s aim was to “remove” itself “from any sort of discourse that people viewed to be political or social in its orientation.”
Retailers have also seen DEI-related tensions spill into their customer base. According to Placer.ai, Walmart’s foot traffic declined 0.1% year over year during the week of May 26. Target experienced a steeper 2.8% drop.
In contrast, Costco (COST)—which has maintained support for DEI and was recognized by the NAACP in its “Black Consumer Advisory”—saw foot traffic rise 3.8% over the same period.
Target’s first-quarter results reflected consumer pushback. The retailer reported a 3.8% drop in same-store sales, which CEO Brian Cornell attributed in part to reactions to “updates [it] shared on belonging in January.”
Cornell added that consumer sensitivity to DEI updates had compounded existing economic headwinds, including tariff-related uncertainty and weaker discretionary spending.
During Walmart’s shareholder meeting on Thursday, one investor asked CEO Doug McMillon whether the company still supported the LGBTQ community and whether it would continue offering Pride merchandise.
“What we continue to try and do is to be a Walmart for everyone … We want everyone that works for the company to be excited about being here, and that’s what we’ll continue to work towards,” McMillon said.
Pump Radar
Stock Alerts