Research shows U.S. diversity rollback is fueling corporate retreat in Canada — researcher explains what HR can do about it
New Canadian research is serving as a signal for employers: President Donald Trump’s second-term executive orders targeting diversity, equity and inclusion (DEI) policies are having international repercussions — and Canadian organizations are not immune.
The research, “The Anti-DEI Agenda: navigating the impact of Trump’s second term on diversity, equity and inclusion” was published last month in the journal Equality, Diversity and Inclusion, and is co-authored by several global experts including Queen’s University professor Eddy Ng.
The study draws clear links between U.S. policy shifts and corporate DEI pullbacks around the world.
“Erasing that, or taking away that [DEI] option, does two things,” says Ng, Professor of Equity and Inclusion, Smith School of Business.
“It erases people's identities … also taking away some of the protections that have been afforded to these individuals, it makes them feel less safe.”
Ng’s research underscores the broad implications of Trump’s DEI dismantling, which include not only the elimination of federal-level protections but a chilling effect that is prompting some companies to quietly shelve or scale back their own DEI efforts.
“It almost appears that the administration is sort of saying that it is okay to delegitimize … to denigrate, to withhold, to disrespect individuals,” says Ng.
“This is a serious assault on so many fronts, from human rights and civil liberties all the way down to what we call common good – access to education, access to health care, access to shelter.”
Spillover effect already showing in Canadian business
Ng’s research identifies early signs of a cross-border effect, particularly among multinational employers.
“We are starting to see some spillover effects up north,” he says, pointing to the recent announcement of more corporate pullouts of funding from Pride Toronto.
According to Ng, the shift in tone is not isolated to corporate sponsorship. Canada’s own public discourse has begun to reflect some of the same scepticism, he says: “We recently had an election, so that's when a lot of things are being put onto the public discourse, and that includes discussions around DEI.”
At the same time, mounting economic pressure is pushing social justice issues off the strategic agenda, adds. “It takes away the focus on social issues, social justice issues.”
HR departments facing competing business priorities may begin to de-emphasize DEI in favour of cost-cutting or risk mitigation, Ng says, stating that some employers may see these programs as a “sacrifice”.
“The other part, of course, is they appointed a lot of chief diversity officers,” he adds. “Now, a lot of those jobs are either erased or eliminated. I think it's important to stay with the course … it's a confluence of a bunch of factors that come together, that sort of see this retreat from DEI initiatives.”
Economic rationale creates a fragile case for DEI
Part of the reason for the retreat is a perceived lack of business payoff, Ng explains, as HR leaders and Canadian employers take stock of profits since widespread DEI adoption after the murder of George Floyd in 2020.
“In short, over the span of five years, not being able to see a concrete, substantive return that they can directly attribute to DEI, that sort of creates the question of whether DEI had been effective in terms of the business case,” Ng says.
While diversity contributes to innovation, problem-solving and creativity, Ng emphasizes that these benefits are not easily measured, meaning benefits can’t be quantified.
“We know that diversity does bring benefits, but it does need to be properly managed to harness that benefit,” he says.
“So just because you have diversity doesn't necessarily mean you stand to gain out of it.”
The "Anti-DEI Agenda" research backs up this view, noting that when economic pressures mount and metrics are unclear, organizations often eliminate programs they perceive as non-essential. “In the absence of being able to connect all the dots clearly, organizations are quick to sacrifice these programs. So that's one of the shortcomings of the business case for diversity.”
Avoid shadow DEI and double down on transparency
Some companies are responding with rebranded or “shadow” DEI efforts to avoid political scrutiny — a move Ng warns can backfire, even if well-intentioned.
“They don't want to be public about this, and yet they want to continue to support marginalized groups,” he says.
“It’s a lot better to be able to have transparency in terms of what you're doing, holding individuals accountable,” he says, pointing to covert changes where job titles are altered without changing the function, or where DEI is folded into general HR without proper resources or recognition.
“The intent is a good one. But of course, at the same time, it does send a message that, ‘Hey, you're not willing to do this publicly.’ So it's almost like telling individuals, ‘you're less valued.’”
The Anti-DEI Agenda article highlights these patterns and notes that shadow DEI can foster employee distrust and reduce program impact, particularly if employees feel their inclusion is conditional or quietly deprioritized.
What HR can do now to strengthen DEI culture
To counter retreat into shadow DEI, and protect the integrity of inclusion efforts, Ng recommends that HR professionals clearly communicate the purpose and value of DEI to both employees and leadership: “Send a message to your existing employees that this is not something that we do because it's fashionable or because it's what everybody else is doing. We do mean it.”
This meaningful action includes specific policies that outline acceptable behaviors, follow through with real resources, and safe spaces in the form of employee resource groups (ERGs).
“Not just create it, but provide not just the space, but resources. I think that's really critical for people to come together,” says Ng.
“Having that ERG is really important. And don't just provide the space, bring professionals in to help them.”
And when it comes to allyship, it needs to go beyond surface gestures. “Have you actually used your own social capital or your privilege to help others?” he says.
“Be willing to make sacrifices.”
Don’t change the name — commit to the work of DEI
Some organizations are removing the term “DEI” from their language altogether, substituting it with euphemisms like “access and achievement,” Ng says; according to him, this tactic is a mistake.
“I think it's important to not change the language, like calling it 'access and achievement', because you know, if it's DEI, it is DEI,” he says.
"It's the language that people understand."
Despite global uncertainty, Ng remains convinced that the long-term arc is one of progress — and that Canadian organizations must resist the pull of short-term retreat.
“Canada has fundamentally changed. There's greater awareness of different types of individual differences… it’s here to stay. So we can’t change that. So that’s a DEI fact.”
