In 2025, consumers are standing on business and forcing companies to pay attention. Since the Trump administration launched its campaign on DEI rollbacks, customers have become more mindful of where they spend their hard-earned money and are participating in Target “fasts” and boycotts in response to major retailer—like Target and Walmart—publicly changing their diversity, equity and inclusion practices and policies.
While Target has admitted that these boycotts have contributed to a decline in sales and foot traffic, it is only one of the many brands warning investors about the customer and legal repercussions and risks of rolling back on diversity, equity, and inclusion (DEI) and environmental, social and governance (ESG) initiatives.
According to CNN, in addition to traditional reports on economic downturns, tax changes, and data breaches, companies are including new risk disclosures in light of the polarized political climate.
“The heightened debate on DEI and climate, in particular, has driven the inclusion of these disclosures in the last few months,” Matteo Tonello, the head of benchmarking and analytics at The Conference Board, told the outlet.
“Often, boycotts catch companies by surprise,” Lawrence Glickman, a historian at Cornell University specializing in consumer activism, added. “Recent boycotts have been successful enough that (companies) are worried about them.”
For instance, Walmart, which ended some of its diversity programs earlier this year, reports that its positions are “subject to heightened scrutiny from consumers, investors, advocacy groups and public figures, potentially leading to consumer boycotts, negative publicity campaigns, litigation and reputational harm.”
“Strong opinions continue to be publicly expressed both for and against diversity, equity and inclusion and ESG initiatives,” Walmart continued in its annual report, per CNN.
Similarly, Target noted the varied and sometimes conflicting opinions and expectations of shareholders, customers, and employees about DEI and ESG in its annual report published in March
“We have previously been unable to meet some of those conflicting expectations, which has led to negative publicity and adversely affected our reputation,” Target shared.
“Companies face a Catch-22 situation,” Kristen Jaconi, director of the Peter Arkley Institute for Risk Management at USC explained. “Consumers may be dissatisfied if a company takes a particular position on a social issue or if a company takes no position at all.”
As the Trump administration opens investigations into what it calls “illegal” DEI efforts, corporations feel pressure from all sides. Now, companies must navigate a new normal: a consumer base that demands action, and a political climate that punishes it.
