Costco has emerged as a rare corporate holdout against the Trump administration’s push to roll back diversity, equity, and inclusion (DEI) initiatives, with CEO Ron Vachris firmly stating he is ‘not prepared to change’ the company’s policies. This stance, coupled with a lawsuit challenging Trump’s tariffs, positions Costco as an unlikely risk-taker in a climate where most large companies are aligning with the administration.
Ron Vachris, who started as a forklift driver in 1982 and became CEO in 2024, leads a company renowned for its humble leadership and strong customer loyalty. Costco’s decision to maintain its DEI efforts followed a shareholder vote in January 2025, where over 98% rejected a proposal to assess financial risks, with the board arguing that diversity fosters creativity and business success. This contrasts with companies like Target and Walmart, which have scaled back DEI programs under political pressure.
In response, 19 state attorneys general, led by Iowa’s Brenna Bird and Kansas’s Kris Kobach, sent a letter to Vachris in late January 2025 urging Costco to repeal its DEI policies, citing concerns about legal compliance after Trump’s executive order targeting DEI. The letter gave Costco 30 days to respond, highlighting the escalating legal challenges for companies resisting the administration’s directives.
Beyond DEI, Costco has taken a bold legal step by joining a lawsuit against the Trump administration over tariffs imposed under emergency powers. The company is seeking refunds for tariffs paid, contending that the administration overstepped its authority. This move is notable as few major corporations have publicly contested Trump’s policies, with most opting for quiet compliance to avoid backlash.
Costco’s ability to defy the administration without significant blowback is attributed to its unique business model and loyal base. With over 90% membership renewal rates and low employee turnover due to competitive wages, the company enjoys bipartisan support, insulating it from political controversies. Analysts suggest that Costco’s reputation for value and fair treatment makes it less vulnerable to retaliation.
The broader corporate landscape shows a trend of retreat from DEI, but Costco’s defiance has garnered praise from progressive customers and civil rights leaders. This positioning allows Costco to appeal to a wide range of consumers while standing firm on its principles, a rare feat in today’s polarized environment.
Looking forward, Costco’s stance will continue to be tested as legal battles over DEI and tariffs progress. The company’s response to the attorneys general and the outcome of the tariff lawsuit could set important precedents for corporate resistance. Despite the risks, Vachris and Costco’s leadership remain committed, emphasizing the long-term benefits of diversity and fair trade practices for sustained business success.
