The world’s largest asset manager will abandon specific targets to increase the representation of employees in its workforce and will no longer require hiring managers to interview a diverse slate of job candidates, the company’s senior executives said in a Friday memo.

BlackRock, which has roughly 21,000 employees, will also combine staff who were on teams devoted to DEI and talent management into one “Talent and Culture” group.

Chief Executive Officer Larry Fink, President Rob Kapito and Caroline Heller, global head of human resources, said in the memo that the firm is taking action because of the recent “significant changes to the US legal and policy environment related to Diversity, Equity and Inclusion (DEI) that apply to many companies, including BlackRock.”

In its 2023 annual report, the company discussed its DEI practices and said “a diverse workforce with an inclusive and connected culture is a commercial imperative and indispensable to its success.” It disclosed percentages of US employees who identified as Black and Latino.

Its 2024 annual report dropped the DEI term and didn’t disclose similar percentages, and it has walked away from board diversity targets in its shareholder voting guidelines.

‘Avoid Groupthink’

In Friday’s memo, the executives said BlackRock is “conducting an ongoing review of our global practices” and “will adapt” to changing laws.

“We are committed to creating a culture that welcomes diverse people and perspectives to foster creative solutions and avoid groupthink,” they added in the memo.

BlackRock’s move follows diversity U-turns by the biggest financial firms, including Goldman Sachs Group Inc. and Citigroup Inc.. Major companies across the US are dialing back DEI programs, especially those with contracts with the U.S. federal government.

BlackRock has helped manage hundreds of billions of dollars in stocks and bonds for the Thrift Savings Plan, the retirement plan for federal workers and members of the uniformed services. 

In 2020, the asset manager set goals to increase its overall representation of Black and Latino employees by 30% in the US and double the number of US leaders in those groups by 2024. BlackRock’s executives said Friday that they won’t renew the goals.

For years, U.S. Republican lawmakers and conservative advocacy groups have targeted BlackRock for being “woke” because of its promotion of environmental, social and governance, or ESG, investing. States pulled billions of dollars from the firm in response to the firm’s ESG investing, and Fink subsequently opted to stop using the term ESG altogether.

BlackRock has more recently emphasized its retirement products, rather than sustainable investing.