Why We Should Maintain Diversity Without The ‘DEI’ Label

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By C200 member Kate Isler

In 2025, businesses are facing an unexpected challenge: how to sustain their commitment to diversity when the term ‘DEI’ has become politically charged. For years, evidence has proven that diverse teams drive innovation, stronger decision-making, and better financial results, but how do we continue this vital work without the DEI label?

As someone who has spent years working to empower women entrepreneurs and build inclusive ecosystems, I know firsthand how essential diversity is to business growth. But at this moment, when the very words we’ve used to describe our progress are being discouraged and vilified, it’s time to rethink our approach, not abandon it.

From Momentum to Backlash

DEI became a corporate buzzword in 2020 as businesses pledged to address inequities in hiring, retention, leadership, and vendor relationships. However, many of these efforts were superficial; policies were made without actionable plans, and little real change followed.

In January 2025, with a new federal administration, the political climate shifted sharply. Suddenly, corporate policies explicitly designed to recruit or retain a broad range of talents with a focus on increasing the appeal to women and minorities were not only under scrutiny but also risked legal penalties. Companies that committed to DEI efforts and made public statements are now pulling back from those policies, editing their websites, disbanding employee resource groups, and quietly abandoning inclusive hiring goals.

The Stakes: Why This Still Matters

Despite the political backlash against DEI initiatives, the need for inclusive teams is more pressing than ever. Companies that overlook diversity risk missing out on top talent, innovative ideas, and the ability to connect with an increasingly diverse customer base. Here’s why it still matters:

1. Women Earn the Majority of Degrees but it doesn’t translate to paychecks or power: According to the WEF Gender Gap Report 2024, women earn 58% of higher education degrees in the U.S. yet remain significantly underrepresented in leadership roles and earn just $0.82 for every $1 men make.
2. Childcare Costs Are Pricing Women Out of the Workforce: inaccessible or unaffordable childcare forces many women to opt out of the workforce or accept lower-paying roles ultimately limiting their career potential
3. Flat Labor Force Participation: Overall labor force participation for women has remained flat since the 1990s, hovering around 56%.

These challenges not only hinder women’s economic advancement but also limit businesses from reaching their full potential. Research continues to show that companies with diverse leadership are more profitable, resilient, and better equipped to meet the needs of both employees and consumers. By prioritizing inclusivity, businesses don’t just do the right thing, they set themselves up for success.

The Customer Connection: Representation Fuels Relevance

We need to adjust the conversation to include customer consideration: today’s customers are incredibly diverse. Across race, gender, generation, income level, and geography, consumers are seeking products and services that reflect their values and lived experiences. That’s not about ideology, it’s about relevance.

And customers notice. They pay attention to whether your team, your messaging, and your products include or ignore them. They also have choices. Inclusive brands don’t just gain loyalty; they grow market share.

We’ve seen this work across industries with both positive and negative outcomes:

1. Costco’s recommitment to DEI policies has won them increased customer loyalty and brand favorability.
2. Nike’s new shift to align with Kim Kardashian for their women’s primer product rather than an elite woman athlete reveals a new strategy and gambles that the trend in hyper-feminism aspiration is more representative of their current female customer base.
3. Fenty Beauty’s wide shade range didn’t just disrupt the cosmetics industry—it redefined what it means to see yourself represented.
4. Target’s decision to withdraw from venture diversity programs is directly impacting its bottom line and customer loyalty.

These aren’t side efforts, they’re core to business success. These approaches reflect business commitment to customer-aligned business strategies and are telling of who they believe their customers to be. Building a team is one of the most powerful ways to reflect your market and meet it where it is. It remains to be seen if these directions will enhance of hurt these influential consumer brands.

The Dilemma for Women Leaders

For women in leadership, this moment can feel particularly disheartening. Many of us worked for years to move the needle, only to see the language of progress politicized. Now we’re being asked to backpedal—or worse, justify our presence.

But we are not going backward. We’re moving forward, just differently. As leaders, we have the tools and insight to adapt. We don’t need the acronym to stay committed to building strong, representative teams. We just need a new framework.

Inclusion by Another Name

If we can’t use the language of DEI, we must reframe the strategy. Here’s how businesses can continue building diverse, high-performing teams without triggering political backlash:

1. Culture Strategy or Team Optimization: Focus on the measurable business benefits of inclusive culture: reduced turnover, higher engagement, stronger innovation.
2. Customer-Centric Hiring: Align workforce representation with the demographics of your customer base.
3. Inclusive Processes: Embed inclusive principles into hiring, onboarding, promotion, and vendor selection without labeling them as DEI.
4. Manager Effectiveness: Train leaders in inclusive behaviors under the umbrella of leadership development and strategic agility.
5. Outcome-Based Metrics: Track business outcomes like performance, retention, and collaboration quality instead of identity-based quotas.

This isn’t about hiding your values, it’s about protecting your strategy so it can thrive.

Keep Doing the Work

I work with women entrepreneurs and leaders every day who are building the next generation of businesses. They understand that reflecting their customer base isn’t about political correctness—it’s about meeting the market. It’s about showing up with authenticity, building trust, and creating better solutions.

The language may have changed, but the mission hasn’t. If we want to build resilient companies that reflect the complexity of the world we serve, we must continue investing in inclusive leadership, practices, and people. The results speak for themselves: sales increase, brand favorability grows, attrition falls, morale improves. The data has never been the problem, only the politics have.

Let’s keep building the diverse, future-ready teams our businesses need. Just don’t call it DEI.

C200 member Kate Isler is the Co-Founder and CEO of TheWMarketplace, a mission-driven company accelerating women-owned businesses in the digital economy. With over 20 years of executive leadership, including global roles at Microsoft, Kate is a fierce advocate for gender equity and co-founder of the nonprofit Be Bold for Change. Her memoir, Breaking Borders (HarperCollins), chronicles her groundbreaking career, from leading in male-dominated tech to living abroad as a trailblazing woman executive. A speaker, author, and lifelong advocate, Kate empowers women to build economic power and close the gender gap.