If 2025 is not the year when Australian companies come to their senses, put that down to a new class of rent-seekers on company boards and in management.
When it comes to deceptively named diversity, equity and inclusion policies, the people responsible for running our big companies have put their heads in the sand. If they read the tea leaves – or even consulted a safe space for progressives such as The Guardian – they’d realise that it’s high time they chose common sense and fairness over fads and ideology.
Earlier this month, Facebook’s parent company announced that it is rolling back its diversity, equity, and inclusion initiatives. AXIOS broke the news of an internal Meta memo that announced to staff the termination of DEI programs in the company’s hiring, development and procurement practices.
“The legal and policy landscape surrounding diversity, equity and inclusion efforts in the United States is changing,” wrote Janelle Gale, vice-president of human resources.
“The Supreme Court of the United States has recently made decisions signalling a shift in how courts will approach DEI. It reaffirms longstanding principles that discrimination should not be tolerated on the basis of inherent characteristics. The term ‘DEI’ has also become charged, in part because it is understood by some as a practice that suggests preferential treatment of some groups over others,” Gale wrote.
Announcing the end to DEI, Gale said that “having goals [for race or gender] can create the impression that decisions are being made based on race or gender”.
You don’t say. Gale told employees that diversity stipulations for suppliers have ended too, along with equity and inclusion training programs. Indeed, like a rock band that’s gone off the rails, the entire DEI team is being disbanded.
Those who value fairness will be celebrating. Meta’s decision to mothball DEI signals a strong trend towards sanity among other big American companies; McDonald’s and Walmart are also rolling back diversity initiatives. Indeed, every week in America another company or university is ditching the DEI fad that has served only to undermine sound and fair employment and education practices.
To be sure, the US Supreme Court decision last year in Students for Fair Admission v Harvard helped American companies see the light, ending employment policies that preferred gender, skin colour and other traits over merit. Donald Trump’s election in November punched a few more nails into the coffin of this misguided progressive shibboleth.
It shouldn’t take a High Court ruling or a Trump-like figure in Australia for companies in our own country to choose fairness over a misguided policy that is anything but fair.
Alas, the single biggest impediment to sanity and fairness in Australian corporate life is a new class of rent-seekers. Those companies with the most iniquitous DEI policies – whether formal or informal – have boards full of DEI beneficiaries whose main recommendation is possession of one or more DEI characteristics.
Just as turkeys never vote for an early Christmas, let alone one at all, a woman who owes her elevation to a quota in favour of XX chromosomes will not be likely to support an end to quotas and other DEI paraphernalia. It might put their own position, and future ones, at risk if the whole DEI shebang is unravelled.
Fuelled by a mushy-minded affection for identity politics, Australian corporates have mandated a class of professional directors, frequently with mediocre to non-existent business careers, who filled, and then reinforced, DEI categories. The old-style ex-CEO types who used to populate company boards were derided as male, pale and stale relics of a past age. Competence, experience and strategic knowledge became ever so passé. Proxy advisers, union-dominated industry super fund investors and professional service firms who grow rich on ever increasing regulatory burdens all conspired to force the new DEI religion on Australian corporates.
The ASX Corporate Governance Council, stuffed to the rafters with these DEI zealots, have ensured that the ASX’s Corporate Governance Guidelines are only a tad shorter than the Tax Act, and far less sensible. OK, I exaggerate the length and complexity of the ASX guidelines, but it’s clear these new “guidelines” where companies risk being shamed for not complying has enriched this new class of DEI devotees.
And with what results? Corporate Australia is regarded as a rather feeble joke by voters, and by both sides of politics. For example, voters were assisted mightily to understand that the voice was a terrible idea when corporate Australia outed itself as a vociferous, and bullying, supporter of the proposal to insert a permanent race-based body into our Constitution. Another example: the ALP pulled the ultimate swiftie on the gullible dopes running big Australian companies when it promised industrial relations moderation and instead delivered a trade union nirvana. Meanwhile, big business abandoned any financial or other support for the Coalition and treated its supporters as unenlightened troglodytes.
Is it any wonder corporate Australia is completely and utterly friendless. Apart, of course, from their fairweather friends in the big four accounting firms, the ASX Corporate Governance Council and the Australian Institute of Company Directors.
The return-to-sanity revolution happening in the US right now can’t get to Australia soon enough. The ASX Corporate Governance Council has ensured that no entrepreneur in his or her right mind, or with any alternative, would list on the Australian stock exchange. If you can raise money from private capital, why submit yourself to the accumulated regulatory excesses of the ASX? That’s why private markets are rapidly supplanting the public markets. Entrepreneurs are voting with their feet.
Another culprit in the process of entrenching DEI is the AICD. This body needs a complete overhaul. Rejigging its leadership team isn’t enough. Enlightened directors who choose fairness over fads will need a new body to help reinstate these values inside companies.
While an overhaul is enough at the AICD and the ASX Corporate Governance Council, dismantling DEI’s reign of terror will require the complete abolition of its key instrumentalities of division. For example, two entities that simply need to be permanently consigned to history are the Orwellian Workplace Gender Equality Agency and the separatist Reconciliation Australia.
The WGEA is an ambitious bureaucracy dedicated to a proposition that neither it nor anyone else has ever proved: that the fact men in aggregate are paid more than women in aggregate stems from inequality rather than deliberate choices. Its claim there is a gender pay gap ignores the fact that it is and has been illegal for nearly 50 years to pay a woman less than a man for the same job because she is a woman. It invents a bogus pay gap by using aggregate figures applicable in a workplace and ignoring pay comparisons on a like-for-like basis. It deliberately offers no clear definition of “gender equality” because that subterfuge enables it to continue to claim women need a leg-up permanently. It wants “gender equity” to remain an ever-receding mirage to entrench its existence and its ability to demand ever larger concessions for its constituents.
Reconciliation Australia is another example of good intentions paving the road to DEI hell. It pursues an agenda of separatism and Indigenous sovereignty under the guise of reconciliation. It wants two Australias, not a single reconciled Australia. Reconciliation action plans foisted on corporate Australia are Trojan horses for division and race-based preferences. Australians have shown that while they strongly support practical help for our Indigenous peoples, and will devote significant tax dollars to doing so, this separatist agenda is anathema.
While analysis of DEI is commonplace in the US, there is next to none in Australia. The DEI bloviators and their useful idiots must be happy. But the blowback is coming. Soon enough, their stubborn attachment to DEI will be exposed as driven by self-interest and injustice, motives that are, in equal measure, ugly and unsustainable.
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