1792 Insights
The 1792 Exchange is committed to delivering sharp, data-driven analysis of corporate America’s political entanglements. Discover what investors, executives, and concerned citizens should know regarding why businesses should return to neutral, mission-focused operations.
Two DEI Settlements, One Clear Warning for Federal Contractors
As the saying goes, “To be forewarned is to be forearmed.” American companies doing business with the federal government have once again been forewarned about the risks of engaging in DEI practices. To ignore these warnings can be very costly for the company, its shareholders, and employees. Just four months ago, IBM paid more than $17 million to resolve allegations that it maintained illegal diversity, equity, and inclusion practices while performing federal contract work. That settlement was the first resolution under the Justice Department’s Civil Rights Fraud Initiative. It was also a clear warning. Last week, President Donald Trump’s DOJ announced that another top federal contractor has agreed to pay $21.5 million to settle similar allegations. The Justice Department alleged that Deloitte violated the False Claims Act by certifying compliance with federal nondiscrimination rules while applying race and sex preferences in hiring, promotions, and staffing. Business units tracked “demographic goals” with color-coded scorecards, and roughly 150 of the firm’s most senior leaders were evaluated, and in some cases compensated, based in part on progress toward those targets. The government further alleged that promotion classes for partners were assigned racial and sex targets, that staffing for federal contracts was managed with a priority toward demographic parity …
High Risk Government Contractors
Companies rated High Risk in the 1792 Exchange Government Contractors database, with total federal dollars committed to each. What “High Risk” means: 1792 Exchange rates a company High Risk when it finds the company yields to DEI activism and/or ESG when shaping its corporate governance, in ways that potentially alienate consumers, divide employees, and harm shareholders. 31 High Risk Companies $186,649,108,331.53 Total Dollars Committed to Them # Company Sector Dollars Committed 1 RTX Defense $25,433,238,417.40 2 Boeing Defense $24,758,962,470.98 3 Northrop Grumman Defense $19,669,506,853.35 4 UnitedHealth Group Healthcare $18,783,399,941.99 5 Leidos Defense $11,789,258,066.34 6 McKesson Healthcare $9,050,183,507.18 7 Booz Allen Hamilton Consulting $8,547,722,731.23 8 BAE Systems Defense $8,333,110,321.96 9 Honeywell International Industrial $7,633,213,844.45 10 Cencora Healthcare $6,091,697,826.62 11 SAIC Defense $5,445,175,403.27 12 Battelle Memorial Institute DBA Battelle Research $4,304,630,074.74 13 Deloitte Touche Tohmatsu Limited (DTTL) Consulting $3,983,960,278.41 14 Dell Technologies Technology $3,428,343,073.05 15 Optum Healthcare $3,309,894,581.24 16 General Electric Industrial $2,997,604,742.81 17 Merck Pharma $2,893,140,940.16 18 Jacobs Solutions Engineering $2,592,607,376.35 19 Parsons Engineering $2,533,637,222.80 20 Sanofi Pharma $1,635,380,052.05 21 United Launch Alliance Aerospace $1,629,701,239.01 22 FedEx Logistics $1,548,586,594.63 23 Oshkosh Corporation Defense $1,467,782,961.82 24 Pfizer Pharma $1,345,771,301.30 25 CGI Technology $1,220,705,109.58 26 GlaxoSmithKline (GSK) Pharma $1,165,068,791.97 27 AECOM Engineering $1,114,301,261.95 …
The EEOC’s mission is opportunity for all, not demographic bean-counting
In the Superman comics, Bizarro World is a place where everything is exactly backward. It is a cube-shaped planet where ugliness is admired, failure is celebrated, lies are preferred to truth, and the normal rules of logic are turned upside down. What is obviously true on Earth becomes false, and what is plainly false is treated as a self-evident fact. Donna Brazile recently accused the Equal Employment Opportunity Commission of abandoning its purpose by proposing to end mandatory annual race-and-sex workforce reporting. Her argument reads like a dispatch from Bizarro World. In truth, the commission’s July 21 Notice of Proposed Rulemaking to rescind the EEO-1 and related demographic reports is a long-overdue course correction that reorients the agency to the actual text and original intent of Title VII of the Civil Rights Act of 1964. Title VII forbids discrimination against any individual based on race, color, religion, sex or national origin. It does not authorize the government to compel every covered employer, regardless of whether a single discrimination charge has been filed, to annually sort its workforce into racial and sex categories and submit the tallies to Washington. That regime, in place for decades, imposed nearly $275 million in annual compliance costs on employers and roughly …
The Federal Bureaucracy Helped Build DEI’s Infrastructure. A New Rule Seeks to Change That.
1792 Exchange Executive Vice President Greg Scott was referenced by the Daily Signal regarding a proposed rule from the Equal Employment Opportunity Commission (EEOC) that would rescind some of the required annual reporting from businesses categorizing employees’ race and sex. 1792 Exchange supports the Commission’s proposal as a long-overdue course correction that reorients the agency to the actual text and original intent of Title VII of the Civil Rights Act of 1964. This change would reduce unnecessary regulatory burden, reaffirm equal opportunity for all, and allow businesses to get back to the work of creating value. Every American business has been treated as a potential suspect, and every employee has been reduced to an overly simplified data point in a group identity spreadsheet. Read the full story at the Daily Signal
As You Sow Misleads Readers about Anti-DEI Proposals
Earlier this summer, as the 2025-2026 proxy season came to a close, leading progressive shareholder group As You Sow intentionally misled readers about the success of anti-DEI proposals. As You Sow suggested that voting results on anti-DEI shareholder proposals at 43 companies this season, including Disney, Costco, Visa, and Apple, proved that 99% of investors are opposed to anti-DEI measures. As You Sow claimed that the universal failure of these proposals sends an “unmistakable message” to corporate boards that DEI is a “financial asset” that directors need to prioritize for the needs of the company, labelling anti-DEI efforts as a “political threat.” A 0-43 record for anti-DEI proposals does appear striking at first. However, no ESG proposals won majority support in the 2025-2026 proxy season, which includes pro-DEI proposals at 0-10 with an average support around 13%. According to Broadridge’s 2025 ProxyPulse report, voting by retail investors “declined to 28% of their shares owned in 2025,” which is the lowest level of participation in 9 years. Low retail investor participation is the historical norm, as proxy votes are disproportionately cast by large institutions on their behalf, not by individual investors. As You Sow knows this. Furthermore, for As You Sow to suggest that “[d]iversity is not a liability to be managed, it is a dividend to be captured” when companies like IBM and Nike have recently faced intense scrutiny for their DEI practices is absurd. To learn more about the Myth of Shareholder Democracy, consider reading Stefan Padfield’s piece titled: Proxy Voting and the Myth About Shareholder Democracy.
DEI by Another Name
In response to legal, political, consumer, or shareholder pressures, companies are increasingly replacing “DEI” terminology with broader terms such as “Inclusion,” “Culture,” or “Belonging,” while providing little explanation as to whether the changes are substantive or primarily cosmetic. For example, CVS Health renamed its public-facing DEI page to ”Inclusion & Belonging” without issuing a public statement explaining the change. The company also stopped referencing a diversity pay metric for leadership in their annual 10-K filing. Similarly, Home Depot quietly removed its DEI webpage and replaced it with a ”Living Our Values“ section. While these changes alter the public branding, they do not necessarily clarify whether the companies’ underlying policies or priorities have materially changed. From a shareholder perspective, this lack of transparency can create uncertainty about a company’s strategic direction and how it intends to approach politically and socially contentious issues going forward. It is in companies’ best fiduciary interest to clearly communicate whether they are maintaining, modifying, or discontinuing DEI-related initiatives rather than simply changing terminology. Providing that clarity allows shareholders and other stakeholders to better understand the company’s priorities and evaluate whether its policies remain focused on advancing its core business objectives and long-term fiduciary responsibilities. Home Depot’s Previous DEI Page vs Its “Rebranded” Page