Why is McDonald’s moving away from DEI practices? Reasons explained

McDonald’s has recently announced some changes to its diversity, equity, and inclusion (DEI) practices. The shift is influenced by the U.S. Supreme Court's ruling in July 2023 that banned affirmative action in college admissions.

In a statement on Monday, January 6, 2025, the company announced that it would discontinue its specific diversity goals, encouraging its suppliers to commit to certain DEI targets. It further added that it will no longer be a part of external surveys that measure corporate diversity.

The company’s diversity team will be renamed the “Global Inclusion Team,” a change that will align with its business values.

“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 said in a statement.

The fast-food chain emphasized its decision to foster inclusion in the workplace and it will discuss with its suppliers and vendors to discuss such practices.

“McDonald’s position and our commitment to inclusion is steadfast,” the company added. “Since our founding, we’ve prided ourselves on understanding that the foundation of our business is people. As Fred Turner said, ‘We’re a people business, and never forget it.’”

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When did McDonald’s introduce diversity initiatives?

In 2021, McDonald’s introduced its diversity initiatives which followed a series of sexual harassment lawsuits from employees. It also included a discrimination lawsuit filed by a group of Black former franchise owners, which highlighted the need for improved diversity and inclusion practices within the company.

At that time McDonald’s Chairman and CEO Chris Kempczinski emphasized making measurable progress considering inclusion as one of its “core values”, and treating all individuals with “dignity and respect.”

Chicago-based chain on Monday said that the recent changes (referring to it as a “shifting legal landscape”) came after the Supreme Court’s decision and action of other companies.

A few reports indicated that 30% of McDonald’s US leaders are members of underrepresented groups, which has increased from 29% in 2021. The company previously committed to reaching 35% by the end of 2025.

"Everyone is welcome under our Golden Arches, and this broad-based appeal is why McDonald's is one of the world's most beloved brands," the company said.

Another report mentioned that the company has the highest number of new diverse franchisee applicants in history.

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What are DEI Initiatives?

Diversity, Equity, and Inclusion are the three key components of DEI initiatives. Diversity stands for ensuring a workforce that reflects different backgrounds, races, ages, and genders to make it welcoming for the employees.

Equity refers to treating all the people in the company with fairness and providing equal opportunities to all employees. Inclusion means creating a welcoming environment so that everyone feels safe and heard. Each individual has a right to the decision-making process.

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According to a report on CNN, the Association of Law Firm Diversity Professionals noted that out of the Fortune 500 companies, only 14 made significant changes to their DEI practices as of 2024.

Ford, Walmart, Lowe’s, John Deere, Harley-Davidson, and Tractor Supply are some other companies that have ended some of their DEI practices. The decision was made due to legal threats, online pressure, and customer opposition as reported by CNN.