March 19th, 2025
Morgan Stanley DEI: Adapting to Trump’s Executive Order and Its Impact on Small Businesses
Morgan Stanley, a global financial services firm, has long emphasized diversity, equity, and inclusion (DEI) in its corporate culture. However, President Trump’s January 2025 executive order, targeting what it deems “illegal DEI” practices, has prompted significant shifts. The Morgan Stanley DEI approach is now evolving, with the firm adjusting its language and focus in response to new regulatory pressures.
↗️ Background on DEI in Corporate America
For Morgan Stanley, these initiatives included quantitative goals, such as increasing representation of women and minorities.
However, recent shifts show a move away from explicit DEI language, with the 2025 annual report replacing a diversity chapter with a “human capital” section, mentioning “inclusion” less frequently.
↗️ Details of Trump’s January 2025 Executive Order
On January 21, 2025, President Trump signed Executive Order 14192, titled “Ending Illegal Discrimination and Restoring Merit-Based Opportunity,” aiming to terminate DEI practices deemed illegal under civil rights laws. The order revokes previous executive orders like EO 11246, which mandated affirmative action in federal contracting, and directs agencies to cease promoting DEI in government processes.
↗️ Morgan Stanley DEI Adjustments
As a federal contractor, Morgan Stanley is subject to these changes. Recent reports suggest the firm is de-emphasizing DEI, with its latest SEC filings removing explicit diversity subheadings and emphasizing meritocracy. The company has stated, “Meritocracy is at the heart of Morgan Stanley’s talent development.” This aligns with the order’s focus on rewarding “individual initiative, skills, performance, and hard work,” potentially scaling back programs like the Institute for Inclusion, which previously supported underserved communities.
↗️ Implications for Small Businesses
Small businesses, particularly those with federal contracts, must navigate similar adjustments.
This shift aligns with a perspective valuing individual opportunity and limited government intervention, as small businesses can focus on performance rather than mandated diversity targets.
