Equity’s Turning Tide: America’s souring mood on quotas is a signal for India

 In keeping with the zeitgeist, Goldman Sachs, one of the biggest investment banks in the world, recently went ‘unwoke’. It would no longer look at DEI (diver­sity, equity, inclusion) parameters when deciding who should be on its board. To know how far it has come, one should remember that not many years ago Goldman used to insist that companies whose IPOs it was underwriting must be DEI-compliant. This is another word for quota, and in the US it meant mostly the presence of women and Blacks. First, Goldman removed that policy and now it has struck down the one that governs itself.

There is no surprise in this because the world has changed after Donald Trump became President of the US. Earlier, not being pro-DEI brought risk; now being for it can be costly because the US government does not approve. The two stances are, however, connected. If the cultural and political insistence on DEI hadn’t been so vehement, the counter-reaction which brought Trump to power wouldn’t have been equally intense. Earlier, Goldman came out with reasons, like how DEI compliance in fact made for better business, and now it is as if that does not matter.

There might be a lesson in it for India too, though it is not clear what exactly. Reservations, the Indian version of DEI, have completely overwhelmed the system. How can it not when the majority of seats or positions are termed ‘reserved’, making those who aren’t eligible for them a minority? It is only a matter of time before they become organised enough to start swinging elections, which is why reservations have been so loved by the political estab­lishment so far. And at that point there is really no leeway left to create further sub-quotas to appease agitated groups. This is already evident in states like Maharashtra, where Marathas are refusing to believe the promises of politicians and are in a state of perpetual agitation.

The US has it better because the options are black and white. Next time, when the political winds change, DEI might return in some form. India has it far tougher because the position of ending reservations altogether doesn’t exist on the table.