Following the U.S. Supreme Court’s 2023 ruling to overturn affirmative action in higher education, reports of companies scaling back or entirely scrapping their diversity, equity, and inclusion (DEI) initiatives have become frequent occurrences. Pressured by lawsuits and political forces, some prominent brands have retreated. These stories have perpetuated a misguided narrative that corporate America is abandoning its long-standing dedication to being responsible corporate citizens and actively supporting the communities they operate in and the broader society. However, that’s not the complete story.
Firstly, let’s clarify something: DEI and corporate social responsibility (CSR) are distinct concepts. Although they often complement each other—particularly in areas like employee volunteerism, nonprofit collaborations, and community initiatives—DEI primarily focuses inwardly on aspects such as recruitment practices, leadership advancement, supplier relationships, and organizational culture. On the other hand, CSR is outward-facing, encompassing how companies engage with the world, including backing local communities, investing in education or sustainability, and forging partnerships that align with their values and business objectives. Today, this could span from providing aid and resources in response to natural disasters to supplying internet access to underprivileged students for their educational needs.
Critics who dismiss all these efforts as “woke capitalism” fail to recognize the substantial work and impact being undertaken behind the scenes. Companies are not engaging in social responsibility solely for appearances; they are doing so because it yields tangible business outcomes. Thoughtful corporate social impact initiatives foster brand credibility, attract top talent, fortify communities crucial to their operations, and, importantly, enhance financial performance. In a 2011 Harvard Business Review article, Michael Porter and Mark Kramer coined the term “shared value,” highlighting the mutual success of businesses and communities.
An illustration of this “shared value” approach can be seen in the Minneapolis/St. Paul area, where numerous companies have collaborated to invest in career development and training programs for youths from disadvantaged and diverse backgrounds. Recognizing that the future workforce’s talent pool will emerge from these communities, these companies view their investments in youth education not just as acts of charity but as strategic, long-term commitments to cultivating the skilled labor force essential for sustaining a high-quality workforce in the region, which is home to several Fortune 100 firms.
Corporate social responsibility is not a luxury but a fundamental business imperative. Consequently, leading companies have established enduring corporate social impact strategies that they have nurtured for decades. Regardless of the prevailing political climate or headline news, they are unlikely to abruptly abandon these initiatives. Undoubtedly, the social impact endeavors that companies have championed for years are now under intense scrutiny in America’s political discourse. Corporate leaders are compelled to review their societal engagements critically. However, from my interactions with our members—corporate citizenship professionals responsible for executing this work—it is evident that companies are not relinquishing their commitment to doing good. Instead, they are evolving their approach to corporate citizenship by reevaluating their engagement strategies.
Communities are evolving in how they discuss their work and are measuring the impact to ensure its longevity. Companies are not abandoning their investments in communities; instead, they are adopting a more strategic approach to engagement. The recent pushback is driving companies to develop stronger and more resilient social impact initiatives. A survey of CSR professionals from 141 major companies revealed that despite external changes, 90% anticipate either maintaining or increasing their commitment to corporate social responsibility. This indicates a positive trend of companies adapting and enhancing their strategies to ensure the sustainability of their efforts. While companies are making adjustments in communication and strategy, it is not a retreat but a solidification of their dedication to impactful and enduring work. Despite the attention-grabbing headlines, the data suggests that the majority of companies are reinforcing their purpose with a more strategic and focused approach. The views expressed in Fortune.com articles are those of the authors and do not necessarily represent the opinions of Fortune.
