The future of corporate Diversity, Equity and Inclusion (DEI) programmes remains in the spotlight, largely driven out of the USA where the re-election of President Donald Trump and the subsequent flurry of executive orders targeting DEI has hastened the discontinuation of DEI initiatives by some major US-based companies.
Since then, litigation both targeting and defending DEI in the USA has continued apace. But what does the DEI backlash mean for Australian employers, boards and company directors with obligations under Australian laws?
In light of these important developments, the KWM Employee Relations and Safety group have prepared a two-part featured insight, which aims to cut through the noise in order to assist Australian employers and their boards to reach a considered position in relation to DEI in 2025 and beyond.
Key takeaways
- The DEI debate will continue to be a matter of interest to employers, boards and investors, as well as employees and unions, throughout 2025. Major US based companies winding back DEI initiatives, and opposition among a reportedly growing cohort of Australian workers, will guarantee prominence. Against this, organisations must consider initiatives necessary under Australian regulatory regimes and their importance for other reasons, including an organisation’s strategic direction.
- Australia’s legal - and cultural - landscape is different in significant ways to that of the USA, meaning it is unlikely that DEI initiatives will be subject to the same degree of unwinding here. Importantly, these differences include Workplace Gender Equality Agency reporting obligations and the positive duty under the Sex Discrimination Act 1984 (Cth), requiring employers to take proactive measures to eliminate direct and indirect sex discrimination, which often overlap considerably with DEI initiatives.
- A key question will be the extent to which Australian businesses with related US-entities will be impacted by President Trump’s executive orders in relation to DEI. However, entities operating in Australia, and their directors, will nonetheless need to continue to comply with ongoing obligations under Australian safety and Respect@Work laws.
- The debate suggests that the key principles and benefits of DEI are often either poorly understood, or misunderstood. If those benefits – including more productive, innovative and happy workforces - are to be realised, there remains a significant communication challenge for organisations in explaining the rationale for DEI and bringing workers along on the journey.
Part 1 of our featured insight is available here. Part 2 is available here. You can also listen to our recent podcast on DEI backlash with David Glasgow, KWM alumnus and NYU Adjunct Professor of Law and Executive Director of the Meltzer Center for Diversity, Inclusion, and Belonging, a renowned expert in DEI whose career in this space has spanned both Australia and the US. The podcast is available on Apple Podcasts and Spotify.
