Tesla CEO Elon Musk has aimed Diversity, Equity, and Inclusion (DEI) initiatives, leading the electric car company to omit all language regarding minority workers and outreach to minority communities in its recent 10-K filing with the Securities and Exchange Commission (SEC). This move comes after Musk’s critical posts about DEI policies and racial discrimination lawsuits against Tesla. Bloomberg was the first to report on the omissions.
Previously, Tesla’s annual 10-K filings for 2020, 2021, and 2022 celebrated the apparent diversity of its workforce and highlighted the importance of integrating DEI principles and practices. The company also mentioned its outreach efforts to Historically Black Colleges and Universities and Hispanic Serving Institutions, as well as its sponsorship of employee resource groups, focused on LGBTQ, Asian Pacific Islanders, and other communities.
However, in the most recent 10-K filing for the 2023 fiscal year, Tesla removed these references, along with any mention of DEI, a diverse workforce, or a majority-minority workforce. Musk has expressed his belief that DEI is “just as morally wrong as any other racism and sexism,” as he tweeted in December. This stands in stark contrast to the response of many corporate America leaders four years ago, who made public commitments to DEI following the social unrest sparked by George Floyd’s murder.
Even before Musk’s criticism, Tesla had faced challenges related to race and equity. Last year, the company was ordered to pay $3 million in a racial discrimination lawsuit brought by a former employee who experienced racial slurs and witnessed racist incidents at its assembly plant in Fremont, California. Additionally, the California Department of Fair Employment and Housing received numerous complaints from workers alleging racism and harassment at the same factory.
The Supreme Court’s decision to limit affirmative action in 2023 and the public ousting of Harvard’s first Black woman president, Claudine Gay, have turned DEI into a political firestorm and a contentious topic in corporate America. Billionaire investor Bill Ackman, who played a role in Gay’s removal, published a lengthy opus arguing against DEI, which was shared by Musk on social media.
Musk has been vocal in his criticism of DEI, stating that it is “just another word for racism” and claiming that it discriminates based on race and gender, making it both immoral and illegal. However, despite the opinions of Musk and Ackman, a survey conducted by employment law firm Littler revealed that hundreds of C-suite executives in the United States remain committed to or have increased their efforts in diversity, equity, and inclusion since 2022.
Notable figures like Mark Cuban, billionaire businessman and minority owner of the Dallas Mavericks, have pushed back against Musk’s stance. Cuban defended DEI as beneficial for businesses and their workers, emphasizing that having a diverse workforce representative of stakeholders is good for business.
In conclusion, Tesla’s recent omission of references to diversity, equity, and inclusion in its 10-K filing reflects CEO Elon Musk’s critical stance on DEI initiatives. Despite the company’s previous commitments and efforts, Tesla has faced racial discrimination lawsuits and allegations of racism and harassment. While Musk’s views have garnered attention, many C-suite executives in the United States continue to prioritize and invest in DEI efforts.