The good, the bad and the ugly of DEI
OVER the past two decades, Diversity, Equity and Inclusion (DEI) has moved from the periphery of corporate discourse to become a key concern in boardrooms.
At its core, DEI seeks to ensure that organisations embrace a workforce and leadership that reflect a broad range of backgrounds, experiences and perspectives. Diversity relates to representation across gender, race, age, culture and more. Equity ensures fair access and opportunities for all, while inclusion fosters environments where different voices are valued and heard.
Modern DEI traces its roots to the civil rights movements in the 1960s when the focus was primarily on racial and gender inequality. Over time, its agenda expanded to cover a wider spectrum of identities and social justice concerns, including age, disability, sexual orientation and socio-economic background.
While the foundational aims of DEI were laudable and necessary, its widening agenda and missteps have polarised public opinion in recent years, with tensions coming to a head following the 2024 election of US President Donald Trump.
What began with good intentions has, in some cases, turned bad and ugly. Boards today must chart a course through this increasingly complex and contested terrain.
The good
At its best, DEI drives fairness, opportunity and social progress by dismantling systemic barriers that have historically disadvantaged minority and vulnerable groups.
BT in your inbox
Start and end each day with the latest news stories and analyses delivered straight to your inbox.
Sign Up
Sign Up
Beyond its social purpose, effective DEI practices strengthen organisational resilience and innovation. Inclusive cultures foster creativity, adaptability and engagement – traits critical for success in today's volatile and complex environment.
For boards, the benefits of diversity are well-documented. Studies show that diverse boards are less susceptible to groupthink and better positioned to assess risk and respond to stakeholder needs. Boards that reflect the diversity of their customers, employees and investors also enjoy greater trust, relevance and legitimacy.
Affirmative efforts to address imbalances have yielded tangible results. In Singapore, for instance, women represented only 8.3 per cent of directors on listed boards in 2013, even though they made up 21.2 per cent of senior management ranks (Gender Diversity on Boards, Diversity Task Force, 2014).
Following sustained efforts by regulators and advocacy groups, this figure rose to 18.1 per cent at the end of 2024 (Singapore Diversity Review 2025, Council for Board Diversity, 2025).
The bad
No doubt, there have been challenges in implementing DEI. Chief among them are perceptions of tokenism and concerns over compromising meritocracy.
A case in point is Norway, the first country to introduce mandatory gender quotas. In 2003, women held just 9 per cent of board seats. The government responded by mandating a 40 per cent quota for publicly-listed boards. While the target was met relatively quickly by 2008, studies found that many women directors were drawn from a limited pool, leading to the phenomenon of 'golden skirts' (a small group of women serving on multiple boards), in effect, creating an outcome similar to the traditional 'old boys' network' for men on boards.
Meanwhile, research into the effects of gender diversity on board governance and company performance has proven inconclusive.
Even without mandated quotas, organisations under pressure to demonstrate diversity may appoint directors for appearance's sake rather than capability. This box-ticking approach risks undermining credibility, diluting performance and tokenising diversity.
While diversity brings valuable perspectives, it can also expose fault lines. Without strong, inclusive leadership, it can lead to fragmented discussions and strained decisions – delivering optics without improving governance or performance.
The ugly
DEI drew sharper criticism when it became entangled with 'wokeism'. Once associated with social justice awareness, the term has evolved into a pejorative for perceived overreach, ideological rigidity and enforced progressive viewpoints.
In the corporate sphere, controversy has arisen around issues such as mandatory pronoun policies, expansive gender identity recognition, and ideological diversity training. These initiatives, though often well-intentioned, have at times alienated employees, customers and shareholders.
The political backlash has been swift. Following his re-election and inauguration in January 2025, President Donald Trump issued executive orders limiting DEI programmes within federal agencies and among contractors. His administration also implemented funding cuts to roll back DEI initiatives in universities and research institutions.
Some high-profile companies, including Disney, Meta, Amazon and Verizon, have ended or scaled back their DEI programmes in response to cost and political pressures. Many others have quietly retreated from expansive efforts, wary of political crossfire.
Whither DEI?
Boards now face a delicate balancing act: do too little and risk alienating progressive stakeholders, or do too much and provoke backlash from others.
The era of uncritical DEI enthusiasm is clearly fading. Yet the core principles of fairness, opportunity and inclusion remain essential to good governance.
Boards should respond not with reactive gestures but with thoughtful, principled leadership. They can continue to champion diversity while upholding merit, ensuring that director appointments bring strategic value rather than serving merely symbolic purposes.
For companies committed to building inclusive and equitable workplaces, the traditional policy-driven DEI model is not the only way forward. Organisations can embed inclusive leadership practices, integrate DEI into core business strategy, support employee-led initiatives, and foster a culture of belonging that transcends identity politics.
Above all, DEI efforts must be anchored in clear objectives and measurable outcomes – where impact, not ideology, is the primary benchmark.
The writer is Past Chairman of the Singapore Institute of Directors.
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
International Business Times
6 hours ago
- International Business Times
Wall Street Shows Mixed Signals as S&P 500 Down 0.21%, Dow Gains 38 Points as Middle East Tensions Escalate
U.S. stock markets finished Friday with mixed results as traders continued to grapple with new geopolitical uncertainty in the Middle East and further cycles in oil and currency markets. The Dow Jones Industrial Average added 38.47 points, or 0.1%, to end at 42,210.13. The S&P 500, on the other hand, slipped 0.21%, while the Nasdaq Composite sank more deeply by 0.49%. Investor sentiment took on a cautious tone as President Donald Trump postponed taking military action in the wake of recent flare-ups in the Israel-Iran conflict. Markets began the day on a positive note, but worries about what could unfold over the weekend contributed to choppy trades and late-session declines. Energy prices also signaled the market's unease. Brent crude dropped 2.3 percent to $77.01 a barrel, but it was still up 3.6 percent for the week. U.S. crude futures settled at $74.93, down 0.28%, but still up 2.7% for the week, despite a holiday-thinned session on Thursday. "People are holding back from major moves ahead of the weekend. There's still a lot of risk tied to how the situation unfolds," said Rick Meckler of Cherry Lane Investments. Diplomatic Moves and Geopolitical Risks: The United States forged ahead with targeted sanctions on enterprises tied to Iran's defense industry, a diplomatic strategy from the White House. But analysts warn that with Israel and Iran continuing to trade hostilities, any miscalculation would see the crisis ratchet higher and put vital oil infrastructure at risk. "There's always a chance of an unintended spark in these kinds of conflicts," said John Evans, an analyst at PVM Oil Associates. European officials called on Tehran to resume negotiations over its nuclear ambitions after a high-level meeting in Geneva ended without progress. European stock markets closed slightly higher, buoyed by optimism from earlier Asian trading sessions. The MSCI World Index was down slightly by 0.01%, while gains in Hong Kong and Seoul helped balance out losses in the other Asian markets. Fed Talk Spotlights Policy The Gap: Federal Reserve officials spoke publicly for the first time since comments by the Fed's chair, Jerome H. Powell, on Wednesday, indicating that the central bank is likely to cut interest rates this year. But he cautioned that inflation, particularly from Trump's trade tariffs, is a risk. A divide among policymakers is also now visible. Governor Christopher Waller insisted to open the door to a rate cut as soon as the next meeting, and Richmond Fed President Tom Barkin countered that there's no rush to move. Powell, for his part, warned against putting too much stock in forecasts in such a dynamic environment. Waller's dovish take sent bond markets into motion. The yield on the benchmark 10-year Treasuries fell 2 basis points to 4.375%. Strong safe-haven demand, which has been soaring in recent weeks because of global tensions, was another factor contributing to the fall. Currency and Commodity Price Movements The dollar was stronger, reaching a three-week high against the yen. A gauge of the dollar against major currencies inched 0.03% higher on the day and 0.6% for the week. The euro was 0.3% firmer at $1.1528. Gold prices were down 0.13% at $3,365.91, set for a weekly decline despite some strength earlier in the week as a safe haven asset.
Business Times
10 hours ago
- Business Times
Taiwan central bank says US debt rising too fast may impact trust in Treasuries
[TAIPEI] Taiwan's central bank governor warned on Saturday (Jun 21) that rapidly rising US debt could be 'unfavourable' to the outlook for US Treasuries and that US President Donald Trump's trade policies have made investors cautious. Taiwan's US$593 billion in foreign exchange reserves are more than 80 per cent made up of US Treasury bonds, according to the central bank, which said earlier this month that Treasuries were 'sound' and still favoured by investors. It added that there were no worries about the US dollar's position as the leading international reserve currency. Governor Yang Chin-long, in a speech posted on the central bank's website, said Trump's repeated criticisms of the US Federal Reserve's monetary policy have caused concerns about its independence. 'In addition, Trump 2.0's trade policy has made investors hesitant about holding US Treasury bonds; Trump's budget, the 'One Big Beautiful Bill Act,' may cause US debt to expand too quickly, which is unfavourable to the outlook for US sovereign debt,' he said. 'All of these have had a significant impact on the international monetary system centred on the US dollar and based on US creditworthiness.' Trump's sweeping tax-cut and spending bill is the centrepiece of his domestic agenda. BT in your inbox Start and end each day with the latest news stories and analyses delivered straight to your inbox. Sign Up Sign Up The bill would lead to a larger-than-expected US$2.8 trillion increase in the federal deficit over the decade, despite a boost to US economic output, the nonpartisan Congressional Budget Office projected on Tuesday. Trump, in his first few weeks in office, also announced sweeping tariffs on a broad swathe of countries and trading partners, including Taiwan, only to pause them for 90 days in April to allow for talks to take place. Yang said Trump had been hoping the tariffs could resolve the US trade deficit. 'However, the tariff policy not only fails to solve the structural problems, it will also impact the US economy, and threaten to further affect the outlook for global trade and the economy.' REUTERS
AsiaOne
11 hours ago
- AsiaOne
Thailand's economy teeters as political turmoil threatens recovery efforts, Asia News
BANGKOK - Thailand's economy is already on the ropes. Consumption has remained tepid despite a government stimulus programme, few of its economic engines are firing, and uncertainty wrought by US President Donald Trump's reciprocal tariffs means that the Thai economy could grow just over 1 per cent this year. Now, Southeast Asia's second-largest economy faces a fresh challenge: a new round of political chaos that can bring down Prime Minister Paetongtarn Shinawatra or her ruling Pheu Thai party. "We are currently in a period of economic downturn, with many issues affecting us," Visit Limlurcha, vice chairman of the Thai Chamber of Commerce, told Reuters. "This could make things even more complicated." The most significant short-term concern is the passage of a 3.78 trillion baht (S$148 billion)budget for the 2026 fiscal year, which starts on Oct 1, that must pass through parliament over the next few months. That process could get stalled if Paetongtarn, who is under siege for her handling of a festering border row with neighbouring Cambodia, dissolves parliament and triggers fresh elections. "If parliament is dissolved before the budget is passed, the process will be delayed significantly," said Prakit Siriwattanaket, managing director of Merchant Partners Asset Management. Finance Minister Pichai Chunhavajira told reporters on Friday that he was optimistic the budget would be approved by parliament by October. "I'm confident that those who are in charge of this matter know that the budget is very important for Thailand," he said. Thailand's economy has lagged regional peers as it struggles under high household debt and borrowing costs, and sluggish demand from China, which is also a key tourism market. It expanded 2.5 per cent last year, and growth could be further halved this year due to US tariffs, Pichai said last month. Thailand's stock market has been the worst performing bourse in Asia so far this year, down 23.4 per cent. Industrial sentiment also hit its lowest in eight months in May, even as consumer confidence dropped to a 27-month low. There is a clear need to press ahead with government spending, which has dropped by over 38 per cent annually during April-May 2025, OCBC economists Lavanya Venkateswaran and Jonathan Ng said in a report on Thursday, warning of a "double whammy" for the economy if both government expenditure and exports weaken. Protests and tariffs Amid the ongoing tumult, Paetongtarn may be able to hang on to her premiership and a coalition led by her Pheu Thai party could retain its majority, albeit in a weaker position compared to its previous grip on the parliament. [[nid:718615]] Such an arrangement will prolong political instability and raise the spectre of street protests, which have been part of previous crises and could hit one of Thailand's key remaining economic engines: tourism. "I'm worried. I don't want the situation to cause people to take to the streets," Thienprasit Chaiyapatranun, President of Thai Hotels Association, which represents around 1,000 hospitality establishments, told Reuters. "If they take to the streets, it will hit tourism." Activists - including those who have in the past agitated against Paetongtarn's father, the divisive former premier Thaksin Shinawatra - met on Friday to plan a major protest next week, and demanded the prime minister's resignation. A government lacking full authority may also struggle in ongoing trade negotiations with the United States, which has threatened to impose a 36 per cent tariff rate on imports from Thailand, said Natapon Khamthakrue, an analyst at Yuanta Securities. "The United States certainly would not want to talk to a government without full power or with few votes," he said. Trade negotiations with Washington will not be concluded in a short period, Finance Minister Pichai said. "Negotiations are never simple for any country, and countries that have begun talks still haven't reached a conclusion," he told reporters. Some business chambers and analysts are, nonetheless, holding out hope that a political resolution can be found quickly, minimising damage to the Thai economy, which has been rattled by multiple coups in the last eight decades, including two against governments led by the Shinawatra family. "Although the economy is no stranger to political uncertainty," OCBC's economists said, "the timing could not be more inconvenient considering external headwinds."
