Target's DEI rollback raises questions about the retail giant's philanthropic commitments

[January 29, 2025]  By JAMES POLLARD

NEW YORK (AP) — Target's rollback on diversity, equity and inclusion initiatives is raising questions about the retail giant's philanthropic commitment to fighting racial disparities and promoting progressive values in liberal Minneapolis, where it is based, and beyond.

Target and the Target Foundation have made six-figure donations in recent years to groups working on Black economic empowerment and LGBTQ+ acceptance. “Racial equity” is still listed as a cornerstone of the foundation's local grantmaking. But some fundraisers now wonder whether those types of gifts remain a primary concern for the brand, as Target joins other major American companies in curtailing internal DEI efforts attacked most prominently by President Donald Trump's administration.

“Billions of dollars are spent annually on DEI, but rather than reducing bias and promoting inclusion, DEI creates and then amplifies prejudicial hostility and exacerbates interpersonal conflict,” The White House said in a statement accompanying Trump's executive orders.

Corporations — including Walmart, Amazon and Meta — are retreating from policies intended to counter discrimination, many of which were implemented after the Minneapolis police killing of George Floyd, a Black man, in 2020. Philanthropic advisors say the conservative backlash is also chilling support from some funders who fear that backing race-based nonprofit work could bring legal challenges like the one that successfully shuttered the Fearless Fund's grant contest for Black women business owners.

Target announced Jan. 24 that it would conclude the DEI goals previously set to increase Black employees' representation and advancement, improve Black shoppers' experiences and promote Black-owned businesses. The company plans to stop submitting reports to external diversity surveys and named Human Rights Campaign's Corporate Equality Index as an example. It is also “further evaluating our corporate partnerships to ensure they are directly connected to our roadmap for growth," according to a memo posted on its website.

Target did not share publicly what those changes meant for its philanthropy — which totaled $384 million last year in cash and products from the corporation and its foundation, according to the company. In response to an Associated Press inquiry, the company described philanthropy as “a key way Target engages with communities, whether in our hometown of Minneapolis-St. Paul, in the communities surrounding our stores, or in the countries where our supply chain exists.”

A company spokesperson told AP that the “recent update does not impact Target Foundation giving” but added that, “as always, the foundation will continue to evaluate how it best supports organizations, coalitions and networks.” Also unchanged is the Target Circle community giving program that allows loyalty members to decide which nonprofits the company supports. Target did not say what impact the internal changes might have on its corporate giving.

“Whenever you see corporate leadership making shifts in priorities, it worries folks in the foundation space about what impacts that might have on both existing giving and future initiatives,” said OutFront Minnesota Executive Director Kat Rohn, who said their LGBTQ+ advocacy group is not a Target partner.

A person heads into a Target store Thursday, Jan. 11, 2024, in Lakewood, Colo. (AP Photo/David Zalubowski, File)

The changes have already influenced how one longtime partner sees their relationship. Twin Cities Pride Executive Director Andi Otto said he learned about the changes when he contacted Target about re-upping its sponsorship of his nonprofit's programming celebrating the LGBTQ community. Target had consistently contributed around $50,000, Otto said.

As he pitched Target on recommitting this year, Otto said he was asked to set up a meeting with company leaders. On the call, according to Otto, executives explained that they still wanted to sponsor Twin Cities Pride but let him know they would be removing internal DEI policies.

Otto said he appreciated the “heads up" but chose to reject Target's sponsorship after his board discussed the impact of the company's moves on the community they serve.

Inclusion falls by the wayside when there aren't checks to ensure it, he added.

“It isn’t always just about the money that they give to us as a nonprofit, but it’s about what they are doing for the community in getting small, BIPOC- or LGBTQ-owned businesses into their stores and giving them a platform to do so,” Otto said.

Twin Cities Pride had seen this coming. Otto recalled that Target didn't carry Pride Month merchandise at its stores last June after the collection received backlash in 2023 and said the nonprofit feared things would “just continue down that slope.”

Progressive activists are now calling for a boycott of Target. Nina Turner's working-class advocacy group We Are Somebody is asking customers to instead purchase directly from minority-owned brands. At least one Black-owned brand, Oh Happy Dani, has begun “the process of removing our remaining products from Target shelves," according to a LinkedIn update from founder Danielle Cook Balfour.

Corporate philanthropy can be a reliable source of significant nonprofit funding. Target has long had a very significant presence in the Twin Cities and is notable for its support of education, arts and other diversity efforts. Target and the Target Foundation together were the fifth-largest corporate giver in the state in 2022, according to the Minnesota Council on Foundations.

But Rohn, the LGBTQ advocate and fundraiser, said corporate philanthropy can sometimes put nonprofits in a "tough spot” by pitting their values against the need to sustain their programs. She expects that more nonprofits will step back from corporate relationships — as Twin Cities Pride did — when their missions no longer align with their sponsors.

To that point, Twin Cities Pride shared Monday that more than $50,000 had been raised since the nonprofit cut Target as a sponsor. Individuals donated more than half the total, according to Otto. The Minneapolis Foundation also contributed.

“Right now, all of us in the LGBTQ nonprofit sector are afraid because we don’t know what companies will choose to do and what the outcome is going to be," Otto said. "I think everybody right now agrees that it was the best decision to make, and that (if) we stick together, we’ll see things on the other side.”

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