Policy on the Menu: How DEI pushback is reshaping the restaurant industryPolicy on the Menu: How DEI pushback is reshaping the restaurant industry

Shortly after taking office for the second time in January, President Donald Trump released a flurry of executive orders targeting diversity, equity, and inclusion programs — touting them as “discriminatory” and in possible violation of “the civil-rights laws of this nation.”

Although most of these laws target federal institutions like the executive order that specifically orders the Federal Aviation Administration to halt “Biden DEI hiring programs,” the private sector will be impacted as well. In the executive order released on Jan. 21, Trump orders “all agencies to enforce our longstanding civil-rights laws and to combat illegal private-sector DEI preferences, mandates, policies, programs, and activities,” though does not outright ban diversity, equity, and inclusion policies.

In response to these executive orders, many companies have already begun to dismantle or change their DEI programs, like Goldman-Sachs, Disney, Google, Amazon, Walmart, Meta, and more, with companies like Meta citing the changing “legal and policy landscape” around DEI, as initially reported by CNBC.

Within the restaurant industry, McDonald’s was one of the first companies to change its DEI policies during the transition to the new presidential administration, with the quick-service chain announcing on Jan. 6 that it would be “retiring” some of its DEI practices, specifically citing the changing legal landscape after the United States Supreme Court ruling in Students For Fair Admissions, Inc. v. President and Fellows of Harvard College in June 2023.

“The Trump administration’s rollback of DEI initiatives could have a chilling effect on diversity efforts within the restaurant industry,” said Jonathan Brown, an attorney with the law firm Pearlman, Brown, and Wax. “While Title VII protections remain in place, the administration’s anti-DEI stance brings increased legal scrutiny to diversity focused employment decisions such as hiring and promotion. Employers who aggressively scale back DEI policies may open themselves up to reverse discrimination claims, adding another layer of legal risk.”

This double-edged legal sword — with Civil Rights protections on one end, and the recent Supreme Court ruling on the other — could create logistical challenges for restaurants and other businesses, especially since the private sector has been strongly encouraged to dismantle its DEI programs.

American corporations began ramping up diversity, equity, and inclusion efforts in mid-2020, around the time that George Floyd — a Black American man — was murdered by a white police officer in Minneapolis, which kicked off a wave of Black Lives Matter protests that swept the nation. Companies first began making pledges to do better to increase the inclusion and diversity of voices and faces in their own organizations, and then many began creating DEI positions and divisions within their companies to make sure those promises were kept.

Within the restaurant industry, companies like Restaurant Brands International, Yum Brands, and Starbucks made commitments to hire a certain percentage of women and people of color at all rungs of the corporate ladder, with several major brands, including Chipotle and Starbucks even tying executive compensation and bonuses to meeting specific standards in diversity of hiring. According to a study released by World at Work, 83% of 656 companies surveyed said that they took action on DEI initiatives in 2021, up 13% from the prior year.

If 2021 was the peak of DEI initiatives in corporate America, then 2023 was the year that the DEI wave began to crest and fall, coinciding with the Supreme Court Affirmative Action decision, and long before Trump took office again. For example, less than four years after Starbucks began linking executive compensation to diversity in 2020 and made the commitment to reaching 30% BIPOC at the corporate level by 2025, shareholders voted to remove the link between diversity and executive compensation after the 2024 annual shareholders’ meeting.

Starbucks is not the only company that has changed its approach to diversity, equity, and inclusion in the wake of legal and societal backlash. As part of McDonald’s announcement that it would be retiring some DEI practices last month, the company changed the name of its diversity division to the Global Inclusion team, stating that, “this name change is more fitting for McDonald’s in light of our inclusion value and better aligns with this team’s work.

“McDonald’s commitment to inclusion and the communities we serve is steadfast,” a spokesperson for the company said when asked about how the company’s approach to DEI has changed. “The critical work of expanding access to opportunity continues because our business thrives when we are shaped by the communities in which we operate.”

While McDonald’s explicitly announced the changes to its diversity programs, other companies in the restaurant industry have been changing their policies more quietly. For example, in August 2020, Bloomin’ Brands promoted Sheilina Henry to the new position of group vice president for diversity and inclusion. In July 2023, Henry was promoted again to president of Fleming’s Prime steakhouse, and her former diversity role was not filled. Instead, Bloomin’ confirmed with Nation’s Restaurant News that “this work and the team [were] transitioned to” the company’s human resources department.

Other companies kept their diversity, equity, and inclusion leadership in place, but simply changed the names of their roles. For example, Wendy’s vice president and chief diversity, equity, and inclusion officer, Beverly Stallings Johnson, is still with the company, but now holds the title of global chief culture and inclusion officer. Similarly, Yum Brands’ chief diversity and inclusion officer, James Fripp, now holds the role of chief culture, opportunity, and belonging officer. Neither company responded to requests for comment on these title changes.

Whether restaurant businesses began changing their DEI policies quietly or announced the shift outright, the evolution in corporate and cultural attitudes toward DEI is clear. In fact, a recently released survey of 1,000 American companies from Resume.org showed that one in eight companies plan to scale back DEI commitments in 2025, with nearly half citing the political climate as a reason. According to the same survey, 60% of managers believe that “DEI initiatives were primarily implemented for public relations purposes.”

“While no one can say with certainty what will happen next in the DEI landscape, we can all recognize that it is in transition,” said Erika Cospy Carr, new vice president of the Multicultural Foodservice & Hospitality Alliance, an affiliate of the National Restaurant Association Education Foundation. “What makes our industry great is that we welcome people of all backgrounds and all ways of life and that creates a better experience for guests. As for MFHA, it will continue to support our partners and the industry as a vital resource to build culturally intelligent businesses and promote individual initiative and potential, regardless of race, sex, creed or other background.”

The MFHA itself has begun utilizing the phrase “cultural intelligence” alongside more familiar terms like diversity, matching the broader language shift of new DEI titles and divisions at restaurant companies, where words like “culture” have begun to replace the more controversial language of “diversity.”

James Pogue, a diversity, inclusion, and bias consultant and founder of JP Enterprises, believes that DEI needs to evolve with the times.

“Anyone who’s saying that they’re just seeing changes [to DEI] now has not been paying attention,” Pogue said. “Around 2020, you couldn’t find a conference without a DEI speaker on the main stage, and not long after that, you couldn’t find it anymore, not because people didn’t care, but because it was overdone. … I think we need to start looking at things more broadly.”

Pogue said that DEI became a performative “buzzword” over the years, with many companies failing to think critically about the meaning behind the acronym and instead, “repainting their website with a bucket of DEI paint.”

“Language evolves,” Pogue said. “A long time ago, we had civil rights, then that became affirmative action, then culturalism, then diversity, then DEI, and now belonging.”

He added that some of the pushback against and fear of DEI could be connected to leaving out certain (white, male, straight) voices from the DEI decision-making table, and that the next evolution of DEI should be about “bringing people together.”

Even though there has been backlash against the DEI culture that rose up in the wake of Black Lives Matter activism, after President Trump’s crackdown on diversity, equity, and inclusion, there has also been a pushback against the pushback.   

The city of Baltimore, multiple higher education organizations, and Restaurant Opportunities Center United just filed a joint lawsuit against President Trump and the executive branch, claiming that the president’s executive orders against DEI are unconstitutional and create the, “twin evils of chilling speech beyond the scope of what may be legally regulated, and granting unfettered discretion to executive branch officials who will implement the President’s orders.”

Despite many companies in the restaurant industry evolving their DEI programs considering cultural and legal changes, they are still receiving backlash. Starbucks, for example, was just sued by the state of Missouri over its DEI policies, in a lawsuit that accuses the coffee chain of discrimination to achieve hiring quotas based on racial background, ethnicity, and gender.

“We disagree with the attorney general, and these allegations are inaccurate,” Starbucks said in a statement. “We are deeply committed to creating opportunity for every single one of our partners [employees]. Our programs and benefits are open to everyone and lawful.”

Additionally, there have been some companies that have chosen to swim against the tide by sticking to their original DEI policies in the face of opposition, like Costco, which according to media reports, “doubled down” on DEI initiatives, even after being told to end them by 19 attorneys general, in a letter that called the company’s policies “unlawful discrimination.”  

From a business perspective, doubling down on DEI could be a unique way for a company to differentiate itself from the competition.

“If there’s less support for these programs, companies will have to decide if it makes sense to take a stand themselves, which could be challenging but also an opportunity to differentiate themselves in a competitive market,” said John Dorer, CEO of EB3.Work, a company that helps employers fill work positions with workers that have EB-3 visas.

Despite the initial flurry of companies dismantling their diversity, equity, and inclusion divisions, the restaurant industry (and rest of the business world), have a long road to go until the legalities of DEI are finalized, and the cultural backlash settles down.

Contact Joanna at [email protected]