Is Microsoft Right to Scale Back its DEI Commitments?

Microsoft has altered its employee performance assessment criteria, removing diversity and inclusion metrics that have been part of its review process for five years. 

The adjustment means employees are no longer required to create annual goals related to diversity and inclusion or to document their contributions in this area for their performance evaluations.

Previously the company operated a system where every employee was required to set a DEI Core Priority. 

This involved choosing focus areas such as building inclusive products, participating in employee resource groups or practising allyship. 

These objectives were discussed with managers and assessed during annual performance reviews, with staff needing to show how they had furthered Microsoft's diversity aims. 

The updated structure simplifies this to focus on goal-based outcomes. Security is now the only mandatory component for all staff members. 

While employees can still pursue inclusion efforts voluntarily, these activities are not scored in performance reviews or formally tracked.

Shifting performance and reporting standards

In addition to the changes in performance reviews, Microsoft has stated it will not release a diversity and inclusion report in 2025. 

This ends a practice of annual disclosures that has been in place since at least 2015. 

The report for October 2024, which was 44 pages long, provided detailed data on workforce demographics, pay equity analysis and information on employee turnover across various groups.

When it was released, Microsoft's Chief Diversity Officer, Lindsay-Rae McIntyre, called it "our most global and transparent report to date", highlighting it as Microsoft's sixth consecutive annual global diversity report. 

Frank Shaw, Microsoft's Chief Communications Officer, explained to Game File that Microsoft was moving "to formats that are more dynamic and accessible – stories, videos and insights that show inclusion in action" instead of a traditional report. 

He added: "Our mission and commitment to our culture and values remain unchanged: empowering every person and organisation to achieve more."

A broader industry recalibration

Microsoft's revised approach is consistent with a wider trend among major technology firms, several of which have scaled back their formal DEI commitments. 

In March, Google updated its Responsible AI and Human Centred Technology team webpage, removing references to diversity and equity. 

Terms like "marginalised communities" and "underrepresented groups" were replaced with more general language such as "varied”.

Meta also confirmed this year it would reduce its DEI efforts. 

In an internal memo, Jannelle Gale, Vice President of Human Resources, wrote that the term DEI had become "charged" and that related initiatives were under greater scrutiny in the current legal climate. 

The memo alluded to a 2023 Supreme Court decision that reversed affirmative action in university admissions, a ruling that has created uncertainty for corporate diversity programmes aimed at supporting socioeconomically disadvantaged groups.

Tracking progress and accountability

Without formal reporting and mandatory performance metrics, observers have questioned how diversity and inclusion progress can be effectively tracked and maintained. 

Microsoft has stated that its cultural expectations for inclusion continue, even if they are not formalised in review processes. 

The change from required goals to voluntary action raises questions about whether employees and managers will keep the same level of engagement when this work is not linked to career progression.

Microsoft's October 2024 report had indicated small increases in representation, with women making up 31.6% of the core workforce and 5.7% of global employees self-identifying as having a disability. 

The report also noted a 270% rise in employees voluntarily taking diversity and inclusion training courses after the DEI Core Priority system was introduced.