GSK, a London-based FTSE 100 pharmaceutical company, has temporarily suspended certain diversity, equity and inclusion (DEI) initiatives for its UK employees. This decision stems from the company’s interpretation of US regulatory requirements. The US is GSK’s largest market.

The Guardian reported that the company has also revised its website, removing explicit references to “diversity” in some sections, focusing instead on “inclusion.” This action follows executive orders issued by US President Donald Trump, which aim to restrict federal agencies and contractors from implementing DEI targets. While some of these orders face legal challenges in the US, numerous companies, including Goldman Sachs, Walmart, McDonald’s, Ford, Amazon, Meta and BlackRock, have adjusted DEI policies.

GSK, led by CEO Emma Walmsley, justified its decision in internal communications by emphasizing that the US is the company’s largest market and the US government is its main customer. It seems all DEI policies are under review, and related activities are paused. However, efforts to ensure diversity in clinical trials, crucial for understanding drug efficacy across different populations, will continue.

Initiatives affected

Specifically, mentoring programs for women and a UK-based social mobility program, designed to assist students from disadvantaged backgrounds, are among the initiatives affected. Charitable activities with a diversity component are also being reviewed.

In its annual report, published last week, GSK said it had largely met previous targets on increasing diversity in ethnicity and gender in leadership. However, “going forward, we will make changes in several areas related to inclusion and diversity to ensure continued compliance with the law and being respectful of our operating environment, including no longer setting aspirational targets for our leadership and supplier programs.”

GSK also announced last week that Walmsley’s potential compensation package could double to $27m within three years, citing the need to remain competitive with a US-based pharmaceutical firms.

The future for DEI

GSK’s approach contrasts with that of its UK pharmaceutical competitor, AstraZeneca, which maintains its existing DEI policies despite its significant US presence (see AstraZenica’s annual report). Danish drug maker Novo Nordisk also stated last month that the company remains committed to its DEI program.

We asked Harriet O’Brien, consultant at Danesmead ESG, for her observations on what may happen next to DEI policy. She lamented: “It is disheartening to see big companies crumbling to pressure from Trump’s executive orders, and the risk of cascading impacts, ie other companies following suit, is very real.

“However, the truth remains that more diverse companies are more profitable and better able to attract talent so this decision seems fairly short sighted. It remains to be seen if companies will truly abandon their DEI ambitions or just simply rebrand them to avoid scrutiny.”

O’Brien set out a fuller exposition of her thoughts on this subject in a recent GRIP article entitled Is this the end for DEI?