Disclosureland: How Corporate Words Constrain Racial Progress

The main objective is that corporate public statements, disclosures, ship how we think, we as a society, not just whether you're in the firm or not, how we all think about racial inequality in the United States. Companies touch all of our lives as consumers of their products and services, employees, as shoulders or investors, as business partners or because of where we live or the air we breathe. Disclosure Land helps us to understand how companies use public statements about race strategically and are doing so, benefits, companies, reputations, while often doing little to actually address racial and economic inequality. You're listening to Bite Size Business Law, where we discuss big issues in small doses. This podcast is sponsored by the Fordham University School of Law, Corporate Law Center, which is run by Fordham law professor Richard Squire and me, your host Amy Martella. Okay, let's get down to business. Welcome back to Bite Size Business Law. Today, we're interviewing the author of a new book that explores the significance of corporate words and their impact on racial progress. Tinoa Day-Duran is a professor of law here at Fordham Law School where her research specializes in the intersection between business, law and society. Her new book is Disclosure Land, how corporate words constrain racial progress. Tino, thanks so much for being here today. Thank you so much for having me, Amy. I'm delighted. As our way, so maybe you can start us out with telling us a little bit about what inspired you to write about this inauthenticity, if you will, of corporate words and their impact on racial progress. Yeah, so picture this. It's 2020. George Floyd was murdered just around the summer and almost every institution, including companies, which have been interested in for a long time, thought they had to say something about the murder of disloyalty and what they would do to alleviate the racial inequality within their firms outside of their firms in society broadly. And as a sociologist, I was fascinated by this because it went from a handful of companies at first to hundreds and then thousands, almost overnight, it seemed to me at the time. And as a legal scholar, I wondered about the implications of these disclosures for law or what law would say about it because it seemed like it was everywhere and I was just thinking about what are the legal implications and or what ways can law intervene in what seemed to be happening, at least at that moment, as the change occurred. Yeah, you have some pretty striking graphs and people, if they pick up the book, we'll see there's some pretty really striking graphs in there of that huge uptick after George Floyd in these voluntary disclosures. I mean, it felt like every big company was getting in on it. Yeah, no precisely. Number is in there. Numbers don't lie as I like to say. So we got up to like 98 percent at some point of some of the largest companies in the world. So is this why Tina, I noticed in your book, you kind of cab in most of the action to like a four-year period beginning in 2020? Is that do you do you kind of build it around the Black Lives Matter movement or are there other factors that had an impact here on the timeline? So a really important point actually to raise because the book examines the period between 2018 and 2025. So it's actually an eight-year period. 2018, so that's two years before George Floyd. And the reason why it does that is to see when the change really occurred. Like, is this a Floyd effect or is this something else? And one finding from the book is that prior to 2020, my company's hardly made statements about race. It was so rare. You would see, you know, non-discrimination statements, which companies have had for decades, statements like, you know, we do not discriminate in the base of race, gender, sexual orientation, et cetera, et cetera. But that was often the extent of it. Say for some companies that made EU-1 demographic disclosures available to the public, also not common at the time for those who don't know what EU-1 demographic disclosures are. Basically, the EUC, the federal agency, that basically regulates discrimination within companies of, sorry, sizes, requires this form. But it's not public, right? You just provided to the EUC and they would monitor to see discrimination. Now, that's complicated by this moment because politics have changed in Washington. But that's essentially the mission of the EUC. Now, 2020 was the historical moment that changed all of that in terms of what companies were making available to the public. Companies began to actually say they would take specific steps to improve the conditions their racism is brought on people of color within institutions like theirs. They became extremely open about demographic information too, about people of color going as far as even telling us how many people of color by race are in leadership or in management positions. And the passage just wouldn't provide that to the public, right? They began to make future pledges saying they would hire or provoke people of color by certain point in time. In the future, they also made statements geared towards philanthropic endeavors. So, you know, we will give or we will pledge the commitment to these organizations or for this particular cause that we think will improve racial diversity or the conditions, experiences of people of color. So, this was a huge change that the Scholarland documents over time. Yeah, and this is a small point. You don't harp on it, but I thought it was an interesting and important one. This was also hypercharged by social media and you had Gen Z who they were demanding transparency after this from companies. They were, and you know, it might seem like even right now they're muted for sure they're coming back. But essentially that moment drew out a lot of activism, if you will, so not just in terms of employees, which would be Gen Z, but also shoulders, et cetera, you know, and so many different groups. And so, particularly younger employees sort of jumped on the moment to push, and then maybe just farms and institutions in general to do more and the way companies responded to that was by saying more. So, you observed, okay, now we have this avalanche of disclosures and that's what you observed. What is the main objective of the book around that? The main objective is that corporate public statements, disclosures, ship how we think we as society, not just whether you're in the firm or not, how we all think about racial inequality in the United States. Companies touch all of our lives as consumers of their products and services, as employees, right, as shoulders or investors, as business partners or because of where we live or the air we breathe, disclosure land helps us to understand how companies use public statements about race strategically and are doing so, benefits companies' reputations while often doing little to actually address racial and economic inequality. Yeah, so, okay, I want to pick up right on that on that last point because you have some really interesting concepts you write about and two really stuck out to me. First is this race conscious image construction. So, tell us about that, how do companies go about building a race conscious reputation and why do they? Right, exactly. So, it's really about reputation. Race conscious image construction is about a company's use of public statements to develop a perception, right, a public persona, if you will, that the company is taking steps to tackle racial inequality or racial inequity. So, it is ultimately about using public statements to develop our reputation that constituent employees, shoulders, even the media, etc. begin to associate a company with carrying about people of color or particular issues. So, it's interesting because one of the things you write in the beginning of this section describing race conscious image construction is that this perception does tend to boost talent, revenue, profit, and have an overall positive impact. So, but I guess your conclusion is, you know, they don't follow through on it. There's a huge inconsistency and that's really the problem. But do we care if it's boosting the company's revenue and profit and it's having a positive impact? How do we think about that? Yeah, that's right. So, what company wouldn't want to boost talent revenue and profit? So, yes, they should use public statements to do so. In fact, this goes to land. It's not seen. Companies should not make public statements at all. I'm agnostic about that. However, they should also do so with a plan on how to actually do the things that clean they would do and not use those statements as a proxy for doing all things related to racial inequality and not needing to address other problems that shoulders or employees raise. This should also not provide some information and leave others that may not be as favorable out. So, here's what I mean. That we saw a lot of companies make what the book calls racial targets. racial targets are pledges to hire a promotion of color, you know, say between 2020 in 2023. That's the period in which companies did this a lot. These companies did not provide the history behind the pledges. Why does a 20% increase in people of color make sense for your company? What kinds of experiences and dare I say discrimination may have occurred prior to the pledges to warrant that? This would be helpful so that if people who don't agree that your company should address racial inequality in this way, query the pledges, you could point to that background context. Without the context, the pledges were difficult to stand behind for a company with constituents who have different views about these issues, for example. So that's just one, right? Not providing context. Just kind of left this pledges hanging and so when pushback from people who don't agree with this came, there was no way to defend them for the most part. I mean, you could defend them legally, but there was no sort of business argument really to defend them for your company specifically. Right. There was no level setting there. And then like when students for fair admission came around, everyone pointed the finger, "Well, we don't, why are you doing racial targeting?" But like you're saying, if we understood the background, that would have been helpful to keep those targets intact. Yeah, that's a good point. And let's just maybe think right now. Okay. You've observed that they make these statements, they conjure up this reputation, and then they don't follow through on it. But how do you know that? Now, you give a really crystallizing example, which I think is helpful. And that is what happens with shareholder proposals. And what happened with those shareholder proposals on racial issues was really telling here. So tell us a little bit about that. This is probably what surprised me the most for my research, that even when companies said they were ready to address racial inequality and their public statements seemed like they would actually do that, they ultimately use those words, those public statements, to push back against other claims that their businesses might somehow perpetrate racial inequalities. So the book provides examples, but imagine a situation where a company makes public commitments to address racial inequalities in its business from 2020 to 2022. So a two year period where it put out a lot of commitments. We'll do this and we're going to do that, you know, racial targets, all of this things. And then in 2023, a year later, shareholders of the company asked for an audit, an audit to determine whether there might be racial inequality in pay or other areas of the business. An audit would be conducted by a third party, third party, someone who's not interested in the company, to really look at the operations, to look at the structure, to figure out if there are in fact potential areas within the company that might create disproportionate impact on people of color, for example, or other things could be pay gap issues, etc. So you might think that because the company is in tune with the issue, it would be receptive to this. It's actually been making commitments for a long time. So it makes sense if the shareholders come and say, hey, why don't you look into this? What most companies did was to say, look, look at all our disclosures. So we don't need to address whatever this shoulder complaint is about anymore. And so that would basically end the inquiry for a lot of these issues raised by shareholders. You point out, it's obviously it's not unusual for boards to ask shareholders to reject shareholder proposals, but here the point is it was this 180. They had conjured up, they had made all these efforts at building this race conscious image. And then the only conclusion you can draw from them rejecting or encouraging shareholders to reject these shareholder proposals is that they really just want the image only. That's right. So a lot of shoulder proposals, I mean, a lot of boards recommend that shoulders, you know, vote against proposals. That's kind of routine. It's not just in this area, actually. It is bizarre, though, when a board, a company has been seeing all these things that they're going to do. And then shoulders are raising issues related to this. And they're saying, well, no, we're not going to do, I mean, it just doesn't make sense. Okay. So then came this phenomenon, which you call race conscious retraction. What is race conscious retraction? And what in your opinion was the biggest driver of that? So race conscious attraction is the opposite of race conscious image construction. It is the modification or total erasure of previously made public statement about race or addressing racial inequality. That's what it is. Modification or total erasure. That's what the race conscious retraction is. Now, nothing, nothing as driven race conscious retraction more than the election of President Trump to a second term as president of the United States. Now, the book delineates two kinds of race conscious retraction. One is called partial and the other is complete. So the partial kind is the modification where companies change descriptions of racism, racial inequality, equity, et cetera, and replace that language with words they think are less likely to generate potential pushback or attention. So inclusion, belonging, right? That started before President Trump came to office. That started in late 2024 and the book sort of documents when this shift happened too. Now, the second type is a complete race conscious retraction, which is total erasure. You said this things and you simply delete them like they never happened before. This complete type started only in 2025. This is a President Trump effect. He came into office and then you started to see this. He put out an executive order specifically, which was almost immediately and lots of rhetoric about DEI and named companies and government contractors and others as implicated in this DEI process a problem, if you will. And so that began to generate the complete type, which is a new phenomenon really a year old. And it's so hairy because we saw this also happen with law firms, right? Where he targeted law firms. What do you do as a business? You're the board and you're being targeted by the president of the United States of America. It's a very hairy situation how you continue to try to build and move toward racial progress in the face of all this. For sure. And that's really difficult. December 15th published Q&A with agenda, which is a financial times publication for boards and C-suite members. And part of the conversation there was, you know, what do these people, people sitting in this position? You're in the board of a Fortune 500 company. For example, how do you grapple with all the political changes, which are really difficult actually to pin down because they're swift and mostly unclear. The EUCE has any chair and no one knows what's going to happen there. You have the president saying this things, but it's really applying to federal contracts. You're not a federal contract. What do you do? But then there's a lot of rhetoric sort of again. So companies do DEI. So you're sort of like, okay, we need to be here. I mean, it's really difficult. And that conversation was to say you have to have your pulse and sort of thinking about this. You should have some sort of committee program process to do with all of the information. And of course, rely on legal counsel as well. You have to think about risk on both ends, right? It's not just the president. It's also what does retraction do to you for you as a company. How might that have negative impact as well? So I just interviewed someone, Matteo Gatti, from Rutgers. And he wrote a book kind of about how the government is prioritized the way ours is. It leaves this void. And who steps into it? Corporations. Often. And so I felt like the most, obviously, the most disturbing part of your book. It's not that companies are using words and then retracting them and kind of just giving us cheap talk or there's no revelation that they care about their bottom line the most. The most disturbing part is it's actually not just words. All of these things actually truly do restrain and constrain racial progress. So tell us about how that really is a serious and real impact. Disclosure Land has a specific definition for racial progress, which is a company taking steps to facilitate advancement for the next generation of minority communities by breaking cycles of racial subordination. So making commitments without providing background history and context makes those commitments weak from the start. Making commitments and then using them as evidence of addressing racial inequalities in a company or its business and taking back commitments all do negative things to advance the minority communities. And it does not help to break cycles of racial subordination. If anything, it can further cement those cycles, especially with retraction. The pledges have not yet been met and then you pull them back which would signal Otherwise, to the public, you're basically, if you make a commitment, right, why would you pull it back unless you've met it or the problem is resolved? The act of actually pulling it back is a negative because you're seeing either it was an important before, it's no longer important or really like you shouldn't have made it, right, whatever it is. Either way, it doesn't help the cause. And if you're seeing that you are committed to this, then you really aren't. And I took from your book like, it has to be more than words, like you can say and create a target. It's how you do it. You can't put people, like you can say 20% more people of color, but you can't just put them in low level roles, but that is your point. It's how they're doing it. That is really going to move us forward. That's right. And part of it is there was a lot of racial targets and some companies did hire a lot of people of color. I would tell you a lot of them have been fired now, but there was a two year period in which they did. But a lot of them were in entry level, low level positions and you probably heard the phrase last hired first fired. And so when a lot of changes happen both economically and also politically, they were the first to be fired, a lot of DEI officers have lost their jobs, a lot of those positions have dried up, like all of those things are connected to this problem. So Tina, are there any instances that you observed or researched where a corporation says they care about racial progress and they do the right things to show that they generally do care about racial progress or not really? I mean, as I said, there was a lot of hiring, for example, that did happen and a tiny fraction of companies did hire people of color into their sea suite. So we can celebrate those and say, yeah, they said that we're going to do something and they did do it. You can look at this. Some companies decided to open, you know, branches of their firm in cities. There are majority of minority like Atlanta, Georgia, okay, and that sort of drew in more people of color specifically more black people, but without really thinking about what the roles are, do they really have any power influence in the company or they just low level employees, you know, if you're thinking about progress and the long term, all of those things matter. So we have little nuggets of things, but now, you know, we're in a reverse state. So we have to think about the implications of this political moment, too. Is this sustained? This is what I'm saying. If you had hired them, perhaps in leadership positions and then they had some say or ability to influence decision making, perhaps you, you know, you can retain that. Why is that? I think, Tina, that racial progress is, it seems like it's somehow different in the ESG world from other things. Like, when I look at like Patagonia, who just made this, we have one shareholder and it's the earth, the urban in Jerry's, which seems very dedicated to sustainable sourcing and all that, it feels like it's somehow different from other ESG issues, race is a harder nut to crack here. Like, why is that? I think this is right and this was the problem, which many scholars sort of raised about the lumping of all these things into the ESG moniker. What does that really mean? And in particular, this is the problem with lump and race into ESG and even the problem with lump and race into DEI or not saying, not saying that you really mean race when you say DEI, even though you do. And this is why disclosure land is focused on race. I could have written this book about DEI, I could have written about DEI in my other work, but I wanted to focus it here because I know there is something distinctively different. The United States has a complicated history with race and that history permeates all institutions, public and private and companies do take steps to show that they care about racial progress. The problem is that even when they do, other things are usually the driving forces. So much so that if it becomes inconvenient, challenging or difficult, issues of race are sideline quickly, even though other issues may not be. So issues of climate change or the environment or even gender are still okay to deal with or to address, but race will be quickly sideline. Such has been said about this, but when some of these conservative politicians say DEI, they really do mean race, but I just want us to call it what it is. Let's be clear on what it is that we're talking about. And that's what disclosure land does. It's really about racial inequality, which is, again, wrapped up in this DEI term, which sometimes has become unclear what it is that one is talking about. No, absolutely, I actually thought it was great for you to isolate race and just write about that. It was kind of much easier to digest than like, what is this amorphous DEI that everyone has been obsessed with? Now I don't want to give the ending away, so to speak, because people will pick it up and see what your recommendation is, how we get there. But I did want you to just say a very briefly, because you talk a lot about a functioning government. That's what this will take, a functioning government, because, of course, at the end of the day, these are corporations who really care mostly about their bottom line. It's really inefficient to ask a corporation to count on them, to spearhead all of our social issues. So tell us why it's so important you think for the government to get back on its feet. As you said, the book really sort of lays out what this future government could do. It's really, you know, I know a lot of a lot of history about researching this book about how companies have engaged with issues of race over time in the United States. I'm familiar with what and how companies have responded to issues of race from at least the 1920s until the present. I will tell you that really, really, no progress has been made in this country without the federal government being involved. And so even when the federal government, you know, sort of implementation of its own laws and/or push to drive companies to do more, I've been weak, they've at least done something. And you can think of this moment, we have a moment where we're not dealing with a progressive, if you will, federal government. We're dealing with one that is not really interested in racial equity. But you can see how its push companies the other way. So either way, the federal government is critical. If the goal is going to be racial progress, we need the government to step in to help us track and think about the ways in which companies are using public statements. Right now there is absolutely no accountability structures at all. Companies can see whatever they want, whenever they want, pull them back wherever they want, modify whatever they want, completely, you know, delete them wherever they want without any consequence at all. And or explanation for why they're making the changes when the government could become at this sort of conduit between the people and the company or the firm. Of course the book talks about in the meantime, since we don't have that, what might other groups be able to do. So consumers, we've seen this, we target and Costco, that can be useful. Where consumers basically react and can put pressure, I'd not saying that always works, but it is, it is noteworthy when it happens, shareholders, of course, have some power as well to step in and try to do something, certainly, you know, the book talks about other groups as well, including the media and sort of how the media should be thinking about this. The media is not being great about how it's reported this thing. So a little bit some guidance on how to think about this from someone who has studied thousands of companies and how they react into this and nonprofits also might be able to help in the meantime. But certainly, you know, the government needs to come back. I know the book you mentioned previously, you know, is really focused on when there is no government. That is not sustainable, at least considering the history of the U.S. and race. Yeah, people will love your chapter on the importance of the government here because you're right, either way, no matter what they do, whether they're supporting civil rights or acting as they are now, it is what impacts corporations so, so, so much. So Tino, when you look into the future, do you see another cycle? At some point I know you've got all the history down, since like you said, the 20s. Do you see if we have another moment like we did in 2020? Do you see corporations going back to that rhetoric and saying, oh, yes, no, no, we really support this. We want to make racial targets and all that, you know, well, just keep ebbing and flowing like that. So I talk about cycles of discourse. and retraction, right? And I see another time when companies would need to grapple with issues of racial inequality. We are in America. It is we have a race problem and whether it's muted, retracted, being disclosed, whatever it is, we have a race problem. And when I see it happening even more so as this administration tries to reverse what little progress companies made between 2021 and 2024, what I don't know is when that would happen and at what scale and what the backlash from that would look like at that point. So all of those things are we just have to see. But I know this is not the last we're going to hear of this. And so this actually, you know, as sad as it is because it's sad that we have this race problem. But it means that disclosure land would probably become relevant again, like decades from now when this happens again, because this is not going to be the last. Absolutely. We have the blueprint coming out on January 15th, Tino, Adedir on disclosure land, how corporate words constrain racial progress. This is a fascinating read. Everyone should pick it up. And thank you so much for your time today. Thank you so much for having me. Thanks to everyone at Fordham Law School, especially the Dean's Office and our corporate law center donors for supporting this podcast. Bite-sized business laws produced by Weed at Podcasts. Listen and subscribe to Bite-sized business law on Spotify, Apple, or wherever you get your podcasts. The information in this podcast is for educational, informational, and entertainment purposes only, and does not constitute legal advice. Nor is it intended to promote the organizations with which our guests are affiliated. For more information, check out our show notes, and thanks for listening.