Attorneys general from 19 US states have demanded that Costco abandon its diversity, equity, and inclusion (DEI) policies, arguing that such practices are discriminatory and illegal. The Republican officials, led by Texas Attorney General Ken Paxton and Iowa Attorney General Brenna Bird, gave Costco 30 days to repeal the policies or explain why they are being retained.
In a letter to Costco CEO Ron Vachris, the officials accused the retailer of violating merit-based principles and federal law. Kansas Attorney General Kris Kobach stated, 'Racial discrimination is both immoral and illegal; hiring violates state and federal law.' The pressure follows Costco's recent shareholder vote to uphold its DEI initiatives, defying President Donald Trump and conservative activists.
Costco has defended its policies, with CEO Ron Vachris arguing that a diverse workforce and supplier base help attract top talent, foster innovation, and enhance the shopping experience. Over 98% of shareholders voted against a proposal from the National Center for Public Policy Research to investigate the risks of DEI policies.
Conservative activists, including Robby Starbuck, have pushed for boycotts of 'woke' companies, but Starbuck noted that Costco was not his focus as 'they are not the worst of the worst.' Meanwhile, Rev Al Sharpton led a 'buy-in' at a Harlem Costco to show support for the company's DEI stance.
Costco is banking on its loyal customer base to weather the controversy, as retail expert Neil Saunders noted that the company views its DEI programs as integral to its strong business performance.
