WASHINGTON – The U.S. Securities and Exchange Commission sided with Alliance Defending Freedom attorneys and denied tech giant IBM’s request to withhold a Diversity, Equity, and Inclusion shareholder resolution from the proxy ballot at its upcoming annual meeting. The latest victory makes ADF 9-for-9 at the SEC over the past three years.
The denial means that IBM shareholders can vote on a resolution filed by The Heritage Foundation calling on IBM’s board of directors to issue a report about the effects of the company’s DEI policies at IBM’s annual shareholder meeting, which will likely be held in late April. IBM had requested permission to keep shareholders from weighing in on the proposal, but the SEC denied the request after ADF attorneys called particular attention to the company’s “absurd” claim that it was unable to properly understand or define DEI.
“Publicly traded corporations like IBM should not hide the truth from their shareholders,” said ADF Senior Counsel and Senior Vice President for Corporate Engagement Jeremy Tedesco. “Decisions about hotly contested topics like DEI affect every shareholder, customer, and employee. And President Trump’s recent executive orders on DEI in federal contracting take direct aim at policies like IBM’s. It is clearer now more than ever that DEI policies introduce steep legal, operational, and reputational risks that far outweigh any perceived benefit. That’s why it’s critical that IBM comes clean and provides its shareholders the transparency they need to make their own decisions about how to exercise their rights as owners in the company.”
Discriminatory DEI policies have been a primary point of discussion in business, politics, and culture over the past year or more—reaching a fever pitch with President Trump’s executive actions meant to root out DEI at government entities, government contractors like IBM (whose federal contracts are worth over a billion dollars per year), and throughout the private sector. Portions of the order, including those applying to federal contracts, are currently enjoined while litigation challenging the orders proceeds.
Major companies ranging from Amazon and Meta to Target and Walmart have all scrapped DEI policies over the past several months. Most recently, financial titan Blackrock announced it is also cutting ties with DEI, while Apple CEO Tim Cook indicated during his company’s annual meeting that Apple is also distancing itself from discriminatory DEI goals—a statement immediately amplified online by Trump.
Heritage’s resolution highlights leaked remarks of IBM’s CEO that have led to a high-profile lawsuit initiated by the state of Missouri. Released by undercover journalist James O’Keefe, the footage shows CEO Arvind Krishna and Paul Cormier, chairman of IBM’s subsidiary Red Hat, responding to an employee’s question about IBM’s DEI commitments. In the video, Krishna states that hiring managers’ bonuses hinge on their meeting internal DEI hiring requirements. Cormier even boasted about “multiple leaders over the last year plus that were held accountable to the point that they’re no longer here at Red Hat.”
So far this year, ADF has gone 4-for-4 at the SEC, successfully backing resolutions at John Deere, Starbucks, and Apple, where all four proposals on the ballot originated from ADF’s shareholder coalition and allies.
“Discriminatory DEI policies have no place in our country,” said Heritage Foundation Vice President of Finance and Accounting, and Treasurer John Backiel. “Heritage has a vested interest in the long-term fiduciary health of IBM. Publicly traded companies like IBM belong to us, their shareholders. That’s why the SEC was right to deny IBM’s request and ensure that we can join this crucial conversation. IBM leaders owe us insight into the business decisions that not only jeopardize our investment but fly in the face of our organization’s stance on issues of human dignity that affect every American.”
Alliance Defending Freedom is an alliance-building, non-profit legal organization committed to protecting religious freedom, free speech, parental rights, and the sanctity of life.
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