Iowa Attorney General Brenna Bird, joined by attorneys general from 18 other states, issued a strong warning to Costco, urging the company to eliminate what they describe as illegal and discriminatory “Diversity, Equity, and Inclusion” (DEI) policies.
The coalition of states is demanding Costco repeal these practices within 30 days or provide an explanation for its refusal to do so.
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The letter comes after Costco’s board of directors unanimously recommended shareholders vote against a proposal requiring the company to report on the financial risks associated with its DEI policies. Instead of reconsidering its approach, Costco has doubled down, with one board member advocating for an expansion of DEI initiatives.
Attorney General Bird and her counterparts argue that Costco’s policies run afoul of the recent U.S. Supreme Court decision in Students for Fair Admissions v. Harvard, which struck down race-based affirmative action in college admissions. Bird also cited President Donald Trump’s recent executive order instructing companies to end race-based and sex-based DEI programs and return to merit-based practices.
“It’s time to ditch DEI,” Bird said. “While other companies right the ship and abandon their illegal, woke policies, Costco has doubled down. I’m putting Costco on notice to do the right thing and eliminate discriminatory DEI. No American should be denied an opportunity because they don’t fit the woke mold.”
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The coalition’s action against Costco follows successful efforts to persuade major companies, including Amazon, Ford, John Deere, McDonald’s, Meta, and Walmart, to abandon similar DEI policies. State attorneys general have warned that DEI programs prioritizing race, gender, or other non-merit factors could violate anti-discrimination laws.
Costco’s refusal to reconsider its stance has drawn sharp criticism, with Bird and other attorneys general calling on the retailer to follow the law and abandon DEI practices that they argue unfairly disadvantage individuals who do not conform to certain demographic criteria.
The coalition’s letter demands that Costco notify the states within 30 days of its plans to repeal its DEI policies or provide justification for failing to do so. Failure to comply could result in legal action from the states involved.
The letter was co-led by Iowa and Kansas, with additional support from Alabama, Arkansas, Georgia, Idaho, Kentucky, Louisiana, Missouri, Montana, Nebraska, North Dakota, Ohio, Oklahoma, South Carolina, South Dakota, Tennessee, Texas, and Virginia.
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This action is the latest in a broader push by Republican state officials and the Trump administration to curb what they describe as “woke” policies in the corporate world, emphasizing a return to merit-based practices and the removal of race- and gender-based preferences.
As the 30-day deadline approaches, all eyes will be on Costco to see whether the retail giant will adjust its policies in response to the growing pressure from state leaders.
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