Costco defends DEI programs as business-positive in proxy filing

Costco is defending diversity programs as part of the way it does business, not as a side project. In proxy materials tied to its January 23, 2025 annual shareholders meeting, the company said an enterprise built on respect and inclusion is “appropriate and necessary,” and argued that a diverse workforce helps bring originality and creativity to merchandise offerings while strengthening the customer experience.

That argument drew a clear verdict from shareholders. Costco’s board unanimously urged investors to reject an anti-DEI proposal from the National Center for Public Policy Research, which asked the company to assess the risks tied to its DEI efforts. Preliminary results showed more than 98% of shares voted against the proposal at the virtual meeting, a sign that investors were willing to back Costco’s inclusion message even as a wave of public criticism gathered outside the company.

The backlash came quickly. On January 27, 2025, a coalition of 19 state attorneys general, including officials from Kansas, Iowa and Virginia, sent Costco a letter urging the retailer to end what they called unlawful DEI policies. That put the Issaquah, Washington-based company in the middle of a broader fight over whether large employers should keep formal diversity programs, even as peers have come under pressure to scale them back.

For Costco workers, the important question is whether the company’s public language connects to day-to-day opportunity inside the warehouse and up the management ladder. Costco says its success has been built on service to employees, members and suppliers, and that many members value seeing themselves reflected in the employees they interact with. That is the business case the company is leaning on: diversity is not just about messaging, but about how well the stores and warehouses serve the people walking through the door.

The financial backdrop gives that defense extra weight. Costco said membership fee revenue rose 10% in fiscal 2025, with renewal rates of 92.3% in the U.S. and Canada and 89.8% worldwide. Its latest filings also showed 443,179,176 shares outstanding as of September 30, 2025, and May 2026 net sales of $24.01 billion, up 14.5% from a year earlier, with comparable sales up 12.5%. The company’s 2026 annual meeting was scheduled for January 15, 2026, with shareholders of record as of November 7, 2025 and the proxy statement first made available around December 4, 2025. Costco’s inclusion pitch is now tied to the same metrics that matter most on the floor: traffic, renewal, and the ability to keep its high-wage model working across stores, depots and management ranks.