From optics to outcomes: how EDI evolved in 2025 - and where smart organisations should go in 2026

Blog posts

6 Jan 2026

Meenakshi Krishnan, Principal Research Fellow

2025 was a turbulent year for equality, diversity and inclusion (EDI). It began with a political shockwave in the United States: an executive order that reframed EDI programmes as ‘illegal discrimination’ and announced cuts to EDI funding and positions. That decision triggered a ripple effect across the corporate world, with many US firms scaling back or dismantling diversity initiatives. The impact was felt on this side of the Atlantic too, as UK employers with US exposure reassessed their own strategies. Some paused programmes or rebranded them under less politically charged language, while others doubled down quietly, embedding inclusion into governance and operations rather than public campaigns.

2025 in review: EDI didn’t disappear, it reset

Through 2025, US companies such as Meta, Amazon, Boeing and Citigroup reduced or eliminated EDI teams, dropped diversity targets or softened public messaging. Investor filings reflected this trend with references to ‘diversity’ and ‘equity’ declining sharply. However, this was not abandonment but a shift away from visible sloganeering to risk management, with more companies disclosing board committee oversight of EDI.

In the UK, organisations took a more cautious approach, maintaining core commitments while adjusting language and emphasis to navigate shifting expectations. While employers like GSK paused or rebranded initiatives to align with the US rollback, others remained committed, with a few even increasing investments. The Financial Conduct Authority and Prudential Regulation Authority decided not to proceed with new diversity and inclusion rules for financial services, citing concerns about burden and overlap.

Language evolved too. Charged terms like ‘DEI/EDI’ became less visible in public disclosures, replaced by softer alternatives such as ‘belonging,’ ‘inclusive leadership’ and ‘culture equity.’ This reframing reflects a desire to reduce political heat while continuing substantive work. The CIPD advised “Resetting EDI and reaffirming inclusion” by aligning EDI with core business objectives, strengthening leadership accountability, simplifying EDI language, tackling AI bias, and embedding inclusion across operations.

Regulators also played a role in shaping the year. What set the response of UK workplaces apart was the legal guardrails provided by the Equality Act 2010. Whatever the political climate, employers are required to prevent discrimination and harassment and to promote equality across protected characteristics. This means that while branding and budgets may shift, dismantling EDI entirely is not an option without significant legal risks. Thus, compliance is the floor, and culture can be the differentiator.

IES’ Rapid Evidence Assessment of what promotes employer behaviour change in relation to EDI found that sustainable EDI progress depends on operational drivers - leadership commitment, recruitment effectiveness, and resource allocation, rather than campaign-led visibility. Another IES research project on Tackling Workforce Inequalities highlighted that the most effective measures include robust complaints procedures and strong senior leadership accountability, not symbolic gestures, celebration days or one-off diversity training. Together, these findings underscore a simple truth: robust systems, coupled with senior leadership commitment and accountability, outperform performative slogans or public relations exercises.

Looking ahead to 2026: a back-to-basics blueprint

After a year of politicised noise and uncertainty, 2026 will reward organisations that treat EDI as core business infrastructure, not a PR device. It will be a year of going back to basics. Organisations that chase a series of campaigns or buzzword trends will fail to generate a return on their investment, but those that recognise its strategic value for workforce engagement, talent acquisition and business growth will continue to invest, and be rewarded for their discipline and focus. Three trends I anticipate for the coming year are:

1. From visibility to value: rebuild the business case

Companies must rebuild the business case for EDI, tying it directly to outcomes that matter: expanded hiring funnels, retention of scarce skills, managerial effectiveness, decision quality and risk reduction. Employers should take a hard look at where they stand, using diagnostics to understand their own workforce realities and labour market conditions. Benchmarking will remain useful, but the priority is to interpret those standards through your own context - focusing on what’s right for your workforce and business.

2. Go deep, not wide: diagnose your starting point and context

EDI investments must be tailored to one’s workforce needs based on organisational context and priorities. A helpful tool for crafting your inclusion journey is IES’ Policy–Process–Practice (PPP) framework. This PPP framework offers employers a comprehensive approach to assess their progress on EDI with multiple entry points for transformation. The starting point is to audit policies, ensuring not just statutory compliance but taking into account employee needs, intersectionality, and wellbeing. Yet, policies alone will not deliver change or inclusion. These have to be supported by substantive people processes – on recruitment, on training, on pay equity, on career progression that bring the policy intent to life.  

The next step is to examine people processes by auditing hiring pipelines and progression systems, strengthening complaints mechanisms with clear service standards and creating feedback loops. However, well-designed processes are not sufficient unless they are enacted through everyday inclusion practices and behaviours of leaders, managers and staff. The final step is to focus on everyday behaviours and practices by building manager capability in inclusive leadership and psychological safety, reviewing cultural norms, and using emerging technologies fairly to prevent bias and exclusion.

Culture doesn’t shift because we say it has. It shifts when systems shift - when our policies, our processes, and our practices change. That’s where the real work lies. This holistic PPP approach, summarised in Figure 1, helps ensure organisations achieve sustainable change and avoid the pitfalls of one-off EDI initiatives.

Figure 1: IES Policy–Process–Practice (PPP) Framework

3. Listen locally: tailor aims to employee voice and labour markets

Success will hinge on listening - really listening - to your workforce and understanding the operational labour market conditions. EDI goals and targets should reflect your organisation’s context, not generic benchmarks or external rankings. Benchmarking can inform, but it must be interpreted through your own realities. This means setting goals that address what matters most to your people and your business. Language will continue to evolve, terms like “belonging” or “inclusive culture” may replace politically charged labels - but substance cannot. Governance, robust complaints mechanisms and leadership accountability must remain strong, ensuring that inclusion is embedded in everyday practice rather than treated as a slogan.

Conclusion: from promise to practice

2026 will not be a year for fanfare, it will be a year for focus. For UK employers, operating under the Equality Act and a sharper regulatory lens on culture, the imperative is clear: treat EDI as core business infrastructure, not a campaign or a compliance tick-box. The question isn’t whether diversity, equality and inclusion matter - they do. This means resourcing EDI properly, aligning it with business strategy, and embedding it into policies, processes and everyday practices.

Inclusion is not about privileging some at the expense of others. It is about fairness of access and removing barriers so that merit applies to all. Done well, it drives trust, talent and growth. In 2026, survival won’t depend on slogans, it will depend on turning promise into practice.

For questions on how you can use the PPP framework in your organisation or any other support on your equality, diversity and inclusion approach, please contact Dr Meenakshi Krishnan at meenakshi.krishnan@employment-studies.co.uk.