• Costco's commitment to diversity and inclusion is facing fresh scrutiny from Republicans.
• In a letter to CEO Ron Vachris, 19 attorneys general urged the company to end its DEI programs.
• Costco shareholders last week overwhelmingly rejected a proposal to report on potential DEI risks.

Costco appears to have a target on its back.

The wholesale club's commitment to DEI is facing fresh scrutiny from 19 Republican attorneys general who say the retailer is "clinging" to "divisive and discriminatory DEI practices."

Led by Iowa's Brenna Bird and Kansas' Kris Kobach, the group sent a letter to Costco CEO Ron Vachris urging him to "end all unlawful discrimination imposed by the company through diversity, equity, and inclusion" policies.

The letter also cites President Donald Trump's executive order from last week that encouraged private companies to end DEI-related initiatives while moving to end the programs at federal agencies.

"Costco should not have policies that discriminate in hiring based on race or gender," the letter said.

The attorneys general did not identify in their letter any specific allegations of discrimination that had occurred at Costco as a result of its diversity-related policies. However, they said that several companies had faced lawsuits related to DEI policies and that ending them would reduce Costco's legal exposure.

Last week, 98% of Costco shareholders rejected a proposal from a conservative think tank to report on any legal and financial risks arising from DEI policies.

"The overwhelming support of our shareholders' vote really puts an answer to that question," Vachris said following the news.

The attorneys general said Costco had 30 days to either notify them that it had ended its DEI policies or explain why it had not.

Many companies, including Meta, McDonald's, and Walmart, have decided in recent months to roll back or end their DEI programs. Target said on Friday that it was ending multiple DEI programs in an effort to stay "in step with the evolving external landscape."

Others, like Costco, have publicly supported DEI. JPMorgan CEO Jamie Dimon recently defended the bank's diversity initiatives.

"We are going to continue to reach out to the Black community, the Hispanic community, the LGBT community, the veterans community," Dimon said.

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