Costco Wholesale has come under fire across numerous states after standing up to Donald Trump as it opts to keep its Equity, Diversity, and Inclusion (DEI) policies. At the same time the company is desperately trying to save its bottom line from the president’s tariffs.
No doubt Trump is expelling steam from his ears right now over literally losing to a wholesaler. But it turns out not everyone can be bullied into submission so easily.
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Costco and DEI
While other American based businesses are scaling back the DEI hiring, Costco made the bold call to continue the current hiring policy it has rather than fall in line like the rest. According to an article from Fortune, shareholders rejected a proposal from a think tank which advised the wholesale company to re-evaluate its DEI initiative.
Earlier this year conservative think tank: The National Center for Public Policy Research, proposed that Costco’s DEI policy could pose risks including “litigation, reputational and financial risks to the company, and therefore financial risks to shareholders.” Despite the apparent risks, the board of directors voted unanimously to ask shareholders to reject the proposal.
Commenting on the situation the board explained that they would be sticking to their guns, “our commitment to an enterprise rooted in respect and inclusion is appropriate and necessary.” The message to shareholders also explained the positives that come with having a diverse workforce.
Republican attorneys general are coming after Costco
Costco’s defiance has seen the company in the crosshairs of 19 Republican attorneys general Newsweek reports. A letter sent to the Costco CEO stated that the company’s decision to double down on its DEI policies goes against the Supreme Court ruling. The letter went on to say that, “every person equally and based on their merit, rather than based on divisive and discriminatory DEI practices.”
Conservatives have long been critical of DEI hiring policies, accusing the practice of being “discriminatory” towards people who are not in a minority group. Trump has also ordered federal agencies to enforce the anti-DEI policies, meaning Costco could be in trouble for not complying.
Costco and the tariffs
Outside of all this DEI business, the company is also grappling with the scary new reality of international trade underneath Donald Trump. The tariffs have hit businesses across the U.S. hard and the wholesaler is trying to pressure suppliers in mainland China to cut prices and mitigate the harmful effect of Trump’s nonsense trade policy. Of course, this will cost the suppliers who have been dealing with the challenges of tariffs and slim profit margins for years.
While tariffs are undoubtedly having an impact, Costco Executive Vice President, Gary Millerchip claimed that the company had prepared for it by pulling forward inventory purchases.
Regardless, Costco no doubt has a battle on its hands with the tariffs and pressure from Republicans. Will the company give in to Trump’s policies if/when the coming months and years bring financial strain? Or will it continue showing the rest how it’s done by sticking by its principles?
Published: Mar 20, 2025 09:33 am