Is your organization’s leadership team rethinking the future of your DEI initiatives and objectives?

The recent Executive Order (EO) entitled “Ending Illegal Discrimination and Restoring Merit-Based Opportunity,” which was issued early February 2025, directly impacts federal government agencies and federal contractors. While it is not directed at private organizations, the EO also encourages private industry to end “illegal” DEI practices.

Now is a good time to assess this key area of business, determine compliance applicability and possible impacts on your culture, and adjust where necessary for ensured continuity and sustained mission impact.

For nonprofits, there are recommended actions to take, particularly if federal grants are a revenue source. For those organizations who are grantees or federal contractors, the highest priorities are likely to be making adjustments to your initiatives and programs where needed and certifying compliance with federal non-discrimination laws. If your mission is focused on delivering technical solutions, products and services focused on DEI, looking at internal programs is necessary in addition to determining where any adjustments may be needed for your external presence. Though all organizations may not be directly subject to the order, now is a good time to proactively minimize the risk of disrupting efforts toward advancing your mission. Considering the many ways elements of DEI are at play within your organization, this should be an ongoing agenda item over the next few months.

It is also important to note that discrimination remains illegal in the same ways that it did previously under Title VII and other federal and state laws. For these reasons, it remains imperative that organizations ensure they are treating employees in accordance with these laws and, of course, providing a safe and respectful workplace.

DEI Woven Through Organizational Strategy

Employers with successful strategies focus on advancing their mission; ensuring financial sustainability; attracting, retaining, engaging, and maximizing performance of their employees; and providing excellent service to their stakeholders. It has been shown that embedding elements of DEI through these areas is a driver for organizational success.

For instance, data shows a positive correlation between having a strong workplace culture grounded in fairness, trust, and belonging, with strong business outcomes. In particular, there is a substantial amount of research on the relationship between belonging and employee engagement, and these remain areas where organizations can continue to focus energy to enhance the employee experience and organizational outcomes. Organizations that are mindful of the communities, members, clients, and customers they serve still need to identify strategies to ensure that their workforce and, ideally, their governing bodies reflect these groups. Some organizations operate under shared values aligned with their mission, which drive how they serve their stakeholders and treat their staff. Many also recognize that diversity of thought and life experiences brings innovation and other benefits to achieve their mission.

Given how elements of DEI are embedded in organizational strategy, you will want to be strategic and intentional when thinking through your objectives and goals so that your organization continues to thrive.

DEI Program Review

The EO on DEI focuses on ensuring access and benefit to all regardless of protected characteristics and specifically providing opportunities based on merit. If your DEI efforts have been aligned to the most progressive best practices, rooted in systems theory and designed with “universal benefits” in mind, it is likely that you are already compliant with these newly explicit guardrails. As a proactive measure, you should review your programs and practices to assess how they align with these provisions.

One of the key elements to consider when developing or reviewing programs is through the lens of fairness. This can be achieved through consistency in how you administer a policy or program. You should also determine if everyone has equal access to the opportunity it provides.

Asking questions such as: Can everyone benefit from the program? Is it bias-free? Is there clarity and effective communication about the reasons policies, practices or programs have been adjusted to ensure that everyone understands, trusts and can benefit from the policy or program? All employees benefit when these elements are taken into consideration in talent management programs and practices, and many of these questions are the same questions that would have been asked before the recent EO was in place.

If your programs meet these criteria, you are not only building a strong culture that meets the expectations of today’s workforce, but you are reducing the possibility of scrutiny of your talent management practices. For example:

• Do you have a compensation philosophy and structure that is communicated to all employees? Is the process for how to advance in pay or position transparent and clear and based on merit?
• Are your professional development opportunities available and communicated to all staff?
• Do you employ a consistent hiring process that seeks to identify and reduce biases? Do these practices assist hiring managers with understanding and identifying the connection between skills, experience and the requirements of a role?
• Are training and education programs designed to provide value and benefit to all staff across the organization (such as effective communication, conflict resolution, enhancing cross-cultural competency, reducing bias in decision-making, fostering a culture of belonging, and others)?

Recommended Next Steps

More than likely your talent leaders have many of these talent management practices in place. The key is to uncover opportunities to communicate both internally and externally the core aspects of these practices and the benefits they provide for the entirety of the organization’s workforce. Help stakeholders understand the business case and how they align with your organization strategy for success.

As practical next steps, you should:

• Perform due diligence on your DEI practices to maximize outcomes for all staff.
• Consult legal counsel and DEI experts when in doubt.
• Broadly communicate about your programs and practices so they are universally accessible and the benefits are understood.

If your programs are built with a strong foundation grounded in fairness, trust, and belonging, you will be able to continue advancing your mission and ensuring a strong workplace culture that benefits all.

As federal policies, rely on our team of compliance leaders to help you stay on top of key actions, pending legislation, and regulatory changes that may impact your organization. Visit OneDigital's resource page for real-time updates: Federal Policy Updates for Employers: What to Watch in 2025.