The Fall of DEI

In the beginning, there was diversity and inclusion, then the acronym expanded and became DEI. From the earliest results, Google or artificial intelligence translates it as: diversity, equity, and inclusion. These three concepts represent a fundamental strategic approach to promoting a fairer, more inclusive, and respectful work environment and society, where all people feel valued and have equal opportunities.

Beautiful, it would even be normal - could it be possible that this didn’t happen naturally in such a civil and highly evolved society as ours? Possible. In fact, it didn’t happen, and there was much work to do. So were the areas of interest ghettos? Did corporate ghettos exist? More or less: cultural diversity, then religious, then racial, then even generational differences became diversity, now called ageing. Then came sensitivities: I’m young and insecure, the company climate is toxic. From that point on, in a whirlwind of multiplying training courses - many virtuous and just as many useless - it became unclear where the path should lead.

Call it what you will, the organization was very diverse. Some even hired a diversity manager. Others said “inclusive culture” at every meeting and that was it. The lexicon changed, and with it the posters in corporate cafeterias. So, while in Italy we ask ourselves, “Is this the end of diversity in the company?”, over there, where the wave of progress started, the word has become radioactive.

In the less impulsive continents (like ours), DEI policies have evolved more sensibly, turning into compliance matters. So to the question, “Is diversity over?”, the answer can be both intelligent and bureaucratic: no, because now it’s a legal obligation, reporting requirement, and part of corporate governance. Culture doesn’t get there, but markets do. Better than nothing.

Saying “it’s the end” isn’t even the right phrase. There has been, yes, a solemn rhetorical cooling - and thank goodness. Corporate sustainability has stepped out of the bubble machine of storytelling: it has become mandatory reporting.

Example: EU Directive 2022/2381 on gender balance on boards. Member states should have adopted it by December 28, 2024; companies have until June 30, 2026, to meet the targets: at least 40 percent of non-executive directors or 33 percent of the entire board must belong to the underrepresented gender.

Against predictions, Italy arrived very early, in fact - you could say - first: the 2011 Golfo-Mosca law raised female board membership from 7 to over 40 percent in a decade. By the end of 2023, women held 43 percent of positions on the boards of listed companies. CEOs? No, still not in decent percentages (around 2 percent). The picture from Consob: the 40 percent minimum quota is a done deal, executive leadership much less so.

The usual managerial fashion process followed: starting with some foolish enthusiasm, then institutionalizing with policies, KPIs, and dedicated committees, and then - at worst - evaporating. Like “total quality” in the 1990s, corporate social responsibility, which was mentioned with shrugs and slight embarrassment by those sitting in the important meetings.

Today we are at a phase transition. Well-intentioned conferences are over, and compliance has arrived. European regulations, Efrag guidelines, ESG reporting directives: do you like it when ideals become obligations? You better like it.

With ESRS S1 Own Workforce, companies must disclose dozens of metrics: workforce composition by gender, percentage of people with disabilities, fair wages, pay gaps, and so on. Saying “we are inclusive” is not enough; documents are needed. Measurements must be made and published.

The latest push (interesting): the EU directive on pay transparency (2023/970). By June 2026, member states must introduce rules requiring companies to report on gender pay gaps, provide information rights on pay levels, and conduct joint evaluations when the gap exceeds certain thresholds. No more well-kept secrets in companies.

Partial conclusion: even if the leading D has fallen out of fashion in corporate language, the legal infrastructure not only holds but grows. In the United States, meanwhile (2025), a federal executive order has mandated the dismantling of DEI programs in the public sector, with universities as the first front, and the unpleasant results we’ve seen are ongoing.

In the private sector, surveys and analyses show companies reformulating or reducing programs, changing the terminology (now “belonging” and “culture” prevail), and in some cases cutting back. This is called selective walk-backs and rebranding. What does it mean? That “DEI” as an acronym is retreating in the U.S., but the goals of managing human risk (litigation, reputation, talent) remain - they’re just renamed and justified differently. In Europe, the goals have rules behind them and compliance requirements for fostering the rare flower of cultural difference are quite boring. Tables, thresholds, audits are needed.

Let’s define “worked.” If it means more women on boards, Italian numbers—thanks to the law—say yes: over 40 percent. CEOs? No, still mostly men. If “working” means reducing the gender pay gap, the road is long. ISTAT finds still wide gaps: more marked among graduates, 16.6 percent, and even 30.8 percent among managers. If “working” means inclusion of people with disabilities, Italy has had a law since 1999 (number 68) with mandatory quotas for companies with more than fifteen employees. Here too, effectiveness depends on the rigor of inspections and actual quality of hiring. The next round of ESRS S1 - which requires publishing the percentage of employees with disabilities - will suddenly make this topic visible.

American legal and public affairs teams first understood that certain words attract litigation, so it’s better to take lateral linguistic paths: thus companies reformulate, move to compliance. But they don’t stop managing discrimination, reputation, and talent risks. Meanwhile, European institutional investors ask for the numbers (commitment is not enough). Those operating across jurisdictions learn a lesson that’s almost intuitive: the same practices, identical, but told differently.

The sensible question that remains, among all that fall away, is not “Is the era of diversity over?” but “What was the era of diversity?”

For years, diversity was a PR metaplan, a set of ceremonies and glosses that had to be pretended exciting (panels, pledges, ambassadors, horrid slides), good intentions, and metaphors about good living. Now the fairy tale book is closed and infrastructure has begun. Board quotas, certified KPIs, disaggregated and published pay gaps, disability metrics, standardized reporting. It has lost the boast of producing an immediate cultural revolution - how can you? Invent it? - and local civilization. Because now stakeholders want verifiable trajectories: by 2026, European boards will have minimum quotas, companies will publish pay and disability gaps. Obviously, reward systems for high virtue rates.

It’s plausible that, while I write this, artificial intelligence systems are already in advanced development by competitive engineers in very dark rooms. In a not-so-distant horizon, the drafting of corporate plans for a beautiful, enlightened, sustainable company might be entrusted to Archie the Little Robot. He will guarantee correct percentage distributions, without discretionary residues or the need to write three-page rationales. After that, Archie and his brothers will take more and more assignments and desks, and we’ll become the diversity quota, until they tell us “go home, we’ll do it.” And the best or worst of possible worlds will begin—we’ll see.