The US Supreme Court opinion striking down affirmative action in college admissions could open the door to legal challenges to corporate DEI and ESG policies.
the United States Supreme Court struck down affirmative action in college admissions. While the opinion was limited to public universities, it could open the door to legal challenges to corporate DEI and ESG policies.
The majority opinion was given by Chief Justice John Roberts who was joined by Justices Thomas, Alito, Gorsuch, Kavanaugh, and Barrett. It focused on two features of the admission process: the tracking of the racial composure of the student body and the use of race in considering admission. The Court found that Harvard’s Admissions Committee process began with a review of “how the breakdown of the class compares to the prior year in terms of racial identities.” The Committee would then “trac[k] how each class is shaping up relative to previous years with an eye towards achieving a level of racial diversity.”
The Court concluded that this process is a violation of the Equal Protection Clause of the Fourteenth Amendment. The Court did not change the precedent of Grutter v. Bollinger, the previous case which upheld affirmative action in college admission, rather it determined that Grutter had run its course and considering race in college admissions was no longer necessary or allowed. Affirmative action came to an end.
It didn’t take long for commentators to begin to draw parallels between the affirmative action ruling and corporate diversity, equity, and inclusion programs. DEI is focused, in part, on creating a more diverse workforce, generally based on gender, race, and sexual orientation.
DEI, while a standalone issue, is typically included in a company’s environmental, social, and governance report. ESG is a type of investing where non-financial factors are considered in making investment choices.
