Last month, Donald Trump’s executive orders on diversity, equity and inclusion (DEI) policies forced multinational firms like Accenture – which has expanded its involvement with the Australian government in recent years – to drop DEI initiatives in a bid to keep US government contracts.
Asked whether Accenture’s decision to drop its DEI initiatives would violate procurement rules related to ethical governance, Minister Gallagher said businesses must adhere to Australian laws and standards.
“People need to follow Australian law. We wouldn’t be seeking to exempt people from those requirements,” Gallagher told Senate estimates last week.
Further probed on what would happen if Accenture maintained its decision to not have any further DEI practices, Department of Finance deputy secretary Richard Windeyer said: “When we or anyone across the Commonwealth is looking to work with Accenture, it will continue to be important that they are able to demonstrate that they are able to support diversity.
“It’s the sort of thing we will certainly look at closely in the context of procurement decisions.”
The concern over Accenture’s decision comes amid a broader shift in corporate governance, with Australia tightening requirements for businesses seeking to work with the government. The Department of Finance’s Commonwealth Supplier Code of Conduct, which took effect in July 2024, explicitly mandated suppliers to prevent discrimination, harassment and support diversity.
In addition, a bill currently before the Senate could impose stricter DEI requirements on companies vying for government contracts, mandating employers with over 500 employees to meet gender equality targets and report progress to the Workplace Gender Equality Agency.
“We’ll use the workplace gender equality reporting framework to make it a rule that, in order to win government work, businesses with 500 or more employees must commit to targets to improve gender equality in their workplaces,” Gallagher said last year.
“These targets will focus on the gender make-up of their boards and the workforce, equal pay, flexible working arrangements, workplace consultation on gender equality, and efforts to prevent and address sexual harassment.”
Meanwhile, also fronting Senate estimates last week, ASIC chair Joe Longo highlighted Australia’s unique approach to DEI, stressing that while the Corporations Act doesn’t explicitly mandate diversity, the country’s values are deeply embedded in its institutions.
“We have a particular culture, a way of doing things in Australia, and we should all be proud of that,” Longo said.
The chair clarified that while Accenture is not breaking the law, it could be seen as violating Australian values by stepping away from its DEI commitments.
“I don’t think you could say ‘the Corporations Act requires diversity in the boardroom’. I don’t think you could put it as bluntly as that. I think it’s more likely to be more subtle,” Longo told Senate estimates.
“If you’re doing business with the Commonwealth then the Commonwealth won’t want to be doing business with an entity that doesn’t subscribe to those values and principles. I can see that way of enforcing this approach.”
Could DEI rollback inspire similar shifts in Australia?
Speaking to InvestorDaily last month, Associate Professor Nathan Eva from the department of management at Monash Business School warned that Trump’s actions to cull DEI could influence Australian leaders and businesses to adopt similar measures.
“This is going to have huge impacts for how we do business worldwide, because, whether we like it or not, as Australia, we do look up to the US as the large English-speaking economy that we do business with on a daily basis,” Eva said on a recent episode of the Relative Return Unplugged podcast.
“Our business practices are informed by them … The DEI initiative, the clean energy initiatives, with lay-offs, there is a chance that that is going to happen here in Australia.”
For Eva, the Trump 2.0 era is reminiscent of the hyper-masculine workplace cultures of the 1980s and 1990s, where fitting in often meant conforming to “ladsy” behaviour and being “one of the boys”.
Eva warned that Australia’s progress towards a fairer, more equitable society could unravel if copycat leaders do, in fact, follow suit.
“We know that this overly hyper-masculine, this really dominant leadership is not sustainable long-term, it does not have long-term financial benefits to organisations. And so, for organisational leaders who are looking at this, saying, ’Do I need to shift my leadership style to this more dominant one’, absolutely not,” he said.
“Trump doesn’t need to worry about long-term performance, he has four years, four years left to be president and to be able to enact his particular agenda.”
To hear more from Nathan Eva, click here.
