The DEI Dilemma: Double Down or Back Down?

In a year of tests for nonprofit leaders, one of the most challenging decisions is whether to take a public stand for diversity and inclusion.

President Trump’s executive orders aiming to end diversity, equity, and inclusion programs are strategically ambiguous and seem designed to have a chilling effect. Charities are sometimes losing federal grants without much explanation, leaving leaders to wonder if the administration’s anti-diversity crusade is to blame.

Many nonprofits face a choice — double down on support for DEI regardless of the potential cost … or acquiesce and stay under the radar to keep federal dollars flowing until the storm passes.

For charities whose core mission is to help low-income people of color thrive, disguising that mission could be fruitless. The right path might simply be to forgo federal funding and turn to foundations and donors for more support, some experts say.

“The Wayback Machine exists,” says Isaac MacDonald, a nonprofit consultant who specializes in strategic planning, referring to an internet archive. “If the federal government wants to figure out if you have those policies, they can figure that out. We do think it’s a little bit of cutting off your nose to spite your face to try to completely pivot who you are.”

826 Boston, a charity that provides tutors to help students with writing, received an email in February from the Massachusetts state service commission stating that AmeriCorps was taking “proactive action” to ensure the charity was not engaging in DEI activities. At stake was a $250,000 grant — more than 7 percent of the charity’s budget — that paid stipends to 11 AmeriCorps tutors.

The charity’s lawyer said it would need to stop publishing many of its books of student writing to comply with the order, says Corey Yarbrough, the organization’s executive director. One book, The Great Cost of Freedom, features essays by ninth-graders that touch on themes like racism, oppression, and resistance.

After consulting with the charity’s board, Yarbrough decided to let the grant go.

“We are proud of our diversity, equity, and inclusion work,” Yarbrough says. “We think it strengthens us as an organization and as a society, and we didn’t want to pause it for the four years of this administration.”

Yarbrough made a public plea to donors to help replace the lost funds. The campaign raised more than $260,000 — more than the federal grant was worth — allowing the charity to hire six new assistants to replace the AmeriCorps tutors.

‘The Grown-Up in the Room’

Other charities have made a very different decision. They’ve been willing to rewrite some language describing their work to avoid jeopardizing a substantial chunk of their budget.

Chicago Cares connects volunteers to community projects in areas of the city with the greatest disinvestment — the South and West sides.

Rosie Drumgoole, the charity’s CEO, articulates the benefits of diversity and inclusion as well as anyone. Affluent corporate volunteers who volunteer for a day in a food pantry might later reflect on why people are hungry, Drumgoole says, and decide to do more to address poverty.

“Maybe they run for office, right?” Drumgoole says. “Or maybe they donate in a different way. All because they’ve had this experience through volunteerism. And that can lead to systems change.”

But she also realizes that “inclusive” has become a “dirty word” — one that her corporate board members fear will invite scrutiny and even attacks from the Trump administration. While Chicago Cares currently receives no federal funding, the charity does rely on local businesses for volunteers, and corporate donations provide 50 percent of the charity’s budget.

“I’ve got some really seasoned people on my board,” Drumgoole says. “When they say, ‘This is unprecedented,’ I better stand up and listen.”

Chicago Cares hasn’t changed the way it operates, but it has changed the language it uses to reduce or eliminate words associated with DEI. Drumgoole has received some pushback from employees — and she says a few may have voluntarily left the charity in part because they didn’t like the changes. But she remains convinced that revising the language was the responsible way to proceed.

“I’ve got to be the grown-up in the room,” Drumgoole says. “If I have to erase a couple of words off my website to make everybody be able to come to the table, that’s what I’m going to do.”

Michael Smith, president of Eckerd Connects, a work-force-development charity, says nonprofit leaders will miss opportunities if they draw a hard line on language and fail to seize opportunities. He cites the ability to use Pell Grants for short-term job-training programs as one positive development in this year’s tax and spending law.

“We’re going to have to think about changing our language sometimes,” says Smith, who led AmeriCorps during the Biden administration. “Look, at the end of the day, are the people that we care about getting served? I don’t want to get into a fight about semantics and words. Are there dollars that we can move to make sure that people that are hungry are getting fed, people that are cold are getting clothed, people that need pathways to opportunity are getting those pathways?”

Benefits of Transparency

Foundations are also looking to avoid scrutiny, and many are thinking twice before supporting nonprofits that could be linked to DEI. That’s prompting organizations like PeerForward, a mentoring charity, to revamp marketing materials.

Featuring photos of students of color may have helped with fundraising amid the increased interest in racial equity after George Floyd’s death, says Gary Linnen, the charity’s chief executive officer. But the organization’s focus has always been on helping low-income, first-generation college students, and programs in some states, such as Kentucky, primarily serve white students. Today, the charity has moved back toward language that emphasizes how it helps all low-income students, regardless of race.

“I can talk about the racial inequities,” Linnen says, “but I don’t need to lead with it.”

Organizations that go too far in trying to stay under the radar could suffer nevertheless, new research by Candid suggests. A study of public tax filings by nearly 149,000 charities found that nonprofits with greater transparency tend to raise significantly more money than other charities.

“A lot of nonprofits are in this impossible situation,” says Cathleen Clerkin, associate vice president of research at Candid. “You can put more information out there and increase the chances of funders finding you. Or you can stay in the shadows and try to ride out some of the current context. But then I think you run the risk of funders not being able to find you, or they may not feel compelled to fund you because they don’t know the details about your work.”

Fighting Back

One time not to stay in the shadows? When your organization has been swept up in a DEI purge. That’s what happened in April to the National Center for Victims of Crime.

The charity thought it had done enough. Until early this year, its Victim Connect Resource Center had a spot on its website where victims could enter that they were LGBTQ and receive referrals to special services. The charity removed that option in February after being instructed by the Justice Department to comply with the administration’s executive orders. Renée Williams, the center’s CEO, and her board decided too much was at stake to take a stand like 826 Boston.

“Our position is that taking a stand like that is a luxury,” she says. “And it’s a luxury we don’t have. Our mission is to serve all victims — not to serve select victims. If Victim Connect was shut down, we would be helping nobody.”

Despite making the change, the charity still lost five federal grants in one night in April, part of a broad termination of 360 grants through the Department of Justice’s Office of Justice Programs. Those cuts have imperiled victims-rights groups with a narrower focus, and led to the closure of Equal Justice USA.

At the National Center for Victims of Crime, the greatest loss was a grant that paid for the Victim Connect hotline, which received 16,000 calls last year. Williams immediately told 15 employees — a third of her staff — that they were being laid off.

But then she hit the phones. She says she did 12 news interviews, and talked to staff members in five Senate offices, in just one day.

“I went on a bit of a media rampage,” Williams says. “We were just pushing and fighting hard.”

During the calls, she noted that the center serves all victims — not special interests. She pointed out the hypocrisy of Trump claiming to stand up for victims while his administration cuts an essential hotline. But Williams also knew that Attorney General Pam Bondi would have final say over the grants, so she says she was careful to avoid criticizing Bondi or the Justice Department directly.

Within 48 hours, Williams received another email stating that two of the grants had been restored, including the grant that supports the hotline.