Florida has filed a federal lawsuit against Target, alleging the retailer misled investors by not disclosing potential financial risks associated with its diversity, equity and inclusion initiatives, particularly its LGBTQ+ Pride merchandise line. The case is part of a growing conservative pushback against corporate DEI programs.
Target launched several DEI initiatives in 2020 following the police killing of George Floyd, but recently announced plans to discontinue a program aimed at better serving Black employees, shoppers, and businesses. Other prominent brands like Walmart have also scrapped or reduced their DEI commitments due to criticism from conservative activists, Republican-led states, and the White House.
The lawsuit, filed in Fort Myers, Florida, argues that Target violated the Securities Exchange Act by failing to warn investors about potential backlash from its DEI initiatives. The company’s 2023 Pride collection faced significant conservative boycotts, leading it to remove certain items from stores.
Florida’s State Board of Administration and America First Legal, a conservative advocacy group, filed the lawsuit alongside Attorney General James Uthmeier. The suit claims Target’s actions directly harmed shareholders by contributing to a decline in sales. While some analysts point to economic factors like inflation as contributing to the decline, others attribute it to the backlash from DEI initiatives.
The outcome of this case could have significant implications for corporate governance and the political landscape surrounding DEI policies in the US.
Source: https://www.newsweek.com/florida-sues-target-over-dei-2034175