Netflix, McCormick Uphold DEI to Investors After Trump Directive

Corporate America has been put on guard by President Trump’s call to ferret out diversity programs, but an early batch of annual reports shows companies aren’t all buckling yet.

Streaming platform Netflix Inc., spice maker McCormick & Co., and homebuilder Lennar Corp. are among businesses that underscored the need for diversity, equity, and inclusion policies in 10-K financial statements published in the wake of a Trump executive order asking federal agencies to flag corporate diversity programs for potential investigations and lawsuits.

Signs of the corporate schism over DEI, however, are also showing up in annual reports. Meta Platforms Inc., in a 10-K filed Thursday morning, re-upped and explained its recent decision to disband its DEI team and retool diversity efforts as a means to “reduce bias.”

Those companies maintaining their diversity efforts, so far, are telling shareholders that such initiatives are essential for their bottom lines.

Companies that have pointed to diversity programs for years as a crux of their business are unlikely to end that refrain, said Atinuke Adediran, an associate professor at Fordham University School of Law who researches corporate disclosures on diversity.

“It’s really hard for you to just erase everything you’ve been saying for the past three years and just get rid of it—I think that’s very bizarre,” she said.

Diversity Disclosures

The annual reports from Netflix Inc., McCormick & Co., and Lennar Corp., all describing the use of DEI to manage their workforces, came less than a week after Trump’s Jan. 21 order targeting corporate diversity initiatives.

Netflix works to “build diversity, inclusion and equity into all aspects of our operations globally,” according to its 10-K. McCormick believes “diversity, equity, and inclusion are at the core of our values and strategic business priorities,” the company said in its 10-K. And Lennar’s “’Everyone’s Included’ mantra relative to inclusion and diversity within our company anchors our unique culture,” the firm said in a 10-K section focused on DEI.

Of the three, only McCormick included diversity, equity, and inclusion among its business risks. A failure to “adequately address potential increased scrutiny of our diversity, equity and inclusion initiatives could impact our ability to achieve our business objectives and adversely affect our future success,” the company said in its 10-K.

Even before recent changes in DEI priorities, companies were signaling to investors that keeping those programs could be risky. A raft of companies disclosed DEI as a “risk factor” in their 10-K filings last year, flagging that they could face lawsuits or dings to their reputations.

The 10-K reports, often published around February, are required for public companies so that shareholders can scour through them for financially pertinent information as well as glimpses into a company’s culture and priorities. Businesses filing their 10-Ks now likely had them mostly wrapped up by the end of last year or early this year, but they could have changed some of the language if they felt it was necessary in the past week, Adediran said.

A Netflix spokesperson declined to comment. McCormick and Lennar representatives didn’t immediately respond to requests for comment.

Corporate Battle

The administration’s edict will further galvanize corporate diversity rollbacks that gathered speed in recent months, including how businesses talk about DEI. Companies had already been renaming or rebranding their DEI programs amid mounting conservative attacks. Trump’s order directed agencies to look for such language shifts, telling them to probe DEI programs “whether specifically denominated ‘DEI’ or otherwise.”

Conservative groups have been targeting diversity initiatives because they say such programs don’t promote equality, and instead discriminate against White or male employees by offering specific opportunities for marginalized groups.

“Trump’s executive orders are noisy and will make people think our well-established laws about sex, race and sexual preference discrimination have evaporated,” said Ann Olivarius, chair and senior partner of McAllister Olivarius. “Companies don’t want to have Trump coming after them, but they also don’t want their workers to think their bosses are racist, sexist or cowards.”

While it’s unclear how most companies will address diversity in their 10-Ks this year, every business will be considering their unique customers, employees, and shareholders as they do so, Adediran said.

It’s possible that some companies will abandon a portion of the DEI language that they included last year.

At least one company made significant changes to how it discussed its diversity initiatives in its 10-K released this week. Sirius XM Holdings Inc. no longer mentioned engagement with Historically Black Colleges and Universities and black professional events. The satellite radio provider also didn’t include language about how it’s “focused on increasing the representation of women and people of color at all levels of our organization,” among other changes from the report it issued in 2024.

A Sirius XM representative didn’t immediately respond to a request for comment.

Meta also said it would include diverse “political views” as part of its hiring objectives.

Still, those backing DEI indicate that while diversity efforts may be blunted, they aren’t going to be eradicated in corporate America.

Meta’s big tech peers Microsoft Corp. and Apple Inc., along with Wall Street titans like longtime JPMorgan Chase & Co. CEO Jamie Dimon, have stood by their diversity policies as a core business practice. At Costco Wholesale Corp.’s annual meeting last Thursday, Tony James, the company’s CEO, defended its diversity efforts against an attack from a conservative activist, reiterating that its position on diversity “is not new.”

The upshot is that the executive order has placed employers in a difficult position, Olivarius said.

“Of course, employers want stability, and it used to be that the government tried to provide this,” she said. “Not now.”