The conversation around diversity, equity, and inclusion (DEI) in corporate America has changed dramatically over the past 12 months. Once a cornerstone of ESG strategies and a prominent feature of sustainability disclosures, DEI has now become one of the most contested topics in the broader backlash against ESG.
What we’re seeing isn’t a wholesale retreat from inclusion, but rather a rebalancing. US companies are recalibrating how they communicate about DEI, shifting from identity-specific terminology to broader, less politicized language. This new approach is less about dismantling DEI programs internally and more about managing external risks in a polarized environment.
Datamaran’s latest research report, “DEI Narrative Shifts in Corporate Disclosures: Responding to Anti-ESG Pressure,” analyzes disclosures from 296 US companies across both sustainability reports and SEC 10-K filings from 2024 and 2025. The findings show how organizations are rewriting their DEI narratives to balance regulatory compliance, reputational risk, and stakeholder expectations.
In this article, we share the headline trends from the research report.
Language Focused on Engagement Not Inclusion
One of the clearest shifts in the data is the rebranding of DEI language.
- 43% of companies changed or downgraded their DEI section headings, or moved disclosures onto their websites rather than sustainability reports.
- 37% removed the DEI section entirely from their 2025 sustainability reports, though most appear to be continuing with the underlying programs.
- 77% of companies that reduced DEI terminology replaced it with broader social framing, particularly around “employee engagement” and “community investment”.
This suggests a deliberate narrative recalibration: rather than abandoning inclusion, companies are choosing more neutral ways to describe it.
Two Narratives: Sustainability Reports vs. 10-K Filings
Another interesting finding is the divergence between voluntary and regulatory disclosures.
- In sustainability reports, DEI references are declining sharply. Mentions of “diversity and inclusion initiatives” fell by 76%, and references to racial and ethnic identity dropped by 62%.
- In contrast, 10-K filings show relative stability. Over 80% of companies maintained or increased references across most DEI categories, indicating that inclusion remains a governance priority when it comes to formal disclosures.
In other words, what companies are saying in their public-facing sustainability reports isn’t always the same as what they’re reporting in official filings.
Softening Commitments & Removing Targets
The research also found that many organizations are backing away from measurable DEI goals:
- 51% retained broad inclusion goals, but often softened or generalized them.
- 43% removed previously disclosed DEI targets altogether, with no replacement.
- Meanwhile, companies continue to use imagery of diverse teams, raising questions about “diversity-washing” due to visual signals without substantive commitments.
This gap between visible commitments and measurable accountability suggests a quieter, more tactical approach to inclusion: keep the programs alive, but avoid putting hard metrics in the spotlight.
Multinationals & Regional Nuances
For companies operating across both the US and Europe, the picture is even more complex. Multinationals followed the general trend of scaling back DEI language, but in some areas, reductions were steeper. For example:
- Mentions of “pay gap” declined by 13% more among multinationals compared to US-only firms.
- Yet other terms, like “gender equality” and “discrimination,” remained relatively steady, reflecting nuanced adjustments based on different regulatory and stakeholder expectations across regions.
The Missed Opportunity: DEI as a Business Lever
Beyond the politics, there's a more fundamental business issue: companies may be undervaluing DEI’s role as a driver of innovation, resilience, and competitive advantage.
In a separate analysis of over 1,800 DEI-related Impacts, Risks, and Opportunities (IROs) from CSRD-aligned companies, we saw that:
- Positive impacts dominate (38.3%)
- Risks are underreported (19%)
- Opportunities are critically underreported (17.4%)
This suggests that while many companies can articulate the reputational and fairness dimensions of DEI, fewer are positioning it as a lever for growth and value creation. The strongest opportunities identified include:
- Attracting and retaining top talent through inclusive workplaces
- Boosting innovation via diverse teams and leadership
- Enhancing employer branding and reputation
- Improving financial results by reducing turnover
In today’s environment of talent scarcity and AI-driven workforce transformation, reframing DEI as a strategic business priority isn’t just progressive, it’s pragmatic.
Where Companies Go from Here
So what should business leaders take away from these findings? Here are some recommendations from the research:
- Align your narrative across channels. Ensure consistency between sustainability reports, 10-Ks, and internal messaging.
- Reframe, don’t remove. Broader umbrellas like “people strategy” can mitigate political risk while keeping substance intact.
- Keep metrics accessible. Even if data moves to annexes or ESG hubs, transparency matters for credibility.
- Treat DEI as a business lever. Innovation, talent, and risk management benefits remain under-recognized.
- Shape the conversation around AI and inclusion. Companies that articulate inclusive approaches to digital transformation will stand out.
Amid mounting scrutiny, the companies that thrive won’t be those that retreat, but those that reframe the challenge into a catalyst for growth.
Turning Pressure into Opportunity
The anti-ESG backlash has put DEI disclosures under the spotlight like never before. But retreating from transparency doesn’t erase expectations from investors, employees, or customers; it only creates risks, from accusations of tokenism to missed opportunities for innovation and growth.
The real path forward isn’t about abandoning DEI, but about telling the story differently. Companies that can balance clarity, credibility, and resilience in their narratives will not only navigate today’s polarized environment but also unlock competitive advantage in talent, innovation, and long-term performance.
Want the full analysis?
The complete research report, “DEI Narrative Shifts in Corporate Disclosures: Responding to Anti-ESG Pressure,” dives deeper into the data from 296 US companies, with detailed breakdowns by disclosure type, sector examples, and practical guidance for business leaders.
Click here to download the full report.
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