Republican attorneys general from 19 states have delivered a stern warning to Costco, cautioning that its Diversity, Equity and Inclusion (DEI) policies may be breaking the law if they involve racial discrimination.
On Monday, the attorneys general sent a letter to Costco, demanding that the retailer end what they describe as "woke" DEI initiatives. The letter gives the company a strict 30-day deadline to either confirm the repeal of its DEI policies or explain why they have not been discontinued.
"It's time to ditch DEI," Iowa Attorney General Brenna Bird said in a statement. "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."
The letter emphasizes that businesses are required to comply with anti-discrimination laws and makes it clear that the AGs are prepared to take legal action if Costco doesn't comply.
"The Supreme Court has repeatedly warned against using race-based preferences and classifications," the letter says. "Race neutral practices, on the other hand, honor the founding ideals of this country."
"Some companies have been sued over DEI policies. Other companies are under investigation for issues relating to DEI," the letter adds.
Although DEI initiatives have gained prominence in corporate America in recent years, President Donald Trump moved swiftly to shut them down upon returning to the White House. On his first day in office, he signed an executive order designed to aggressively dismantle federal diversity and inclusion programs. He labeled these initiatives as "discrimination" and argued that hiring and promotion decisions should be determined exclusively by merit, without factoring in diversity considerations.
While several major companies -- including Amazon, Ford, John Deere, McDonald's, Meta and Walmart -- have backed away from DEI initiatives, the attorneys general argue that Costco has "doubled down" on its policies. This comes after shareholders rejected a proposal that would have required the company to assess potential risks linked to its DEI programs.
"Although Costco's motto is "do the right thing," it appears that the company is doing the wrong thing — clinging to DEI policies that courts and businesses have rejected as illegal," the letter says. "Costco should treat every person equally and based on their merit, rather than based on divisive and discriminatory DEI practices."
Iowa co-led the letter to Costco with Kansas. They were joined by Alabama, Arkansas, Georgia, Idaho, Kentucky, Louisiana, Missouri, Montana, Nebraska, North Dakota, Ohio, Oklahoma, South Carolina, South Dakota, Tennessee, Texas and Virginia.
Costco has not publicly commented on the letter.