Diversity, equity and inclusion at U.S. Class Is: A status update
6/5/2024
By Julie Sneider, Senior Editor
A U.S. Supreme Court ruling, an economic shift and politicization of organizations’ diversity goals have prompted a backlash against corporate diversity, equity and inclusion (DEI) programs over the past year. As a result, some companies' DEI efforts — which often stem from, or are included as part of, companies’ goals to recruit and retain new talent as the boomer-generation workforce retires — have lost steam over the past year, according to news media and consulting firm reports.
For example, after two years of unprecedented investment in DEI sparked by George Floyd’s murder and the subsequent racial justice movement in 2020, the global momentum around DEI slowed in 2023, according to consulting firm Paradigm’s November 2023 report, “The State of Data-Driven DEI: 2023 Trends & 2024 Opportunities.”
The report cites a number of headwinds that contributed to the shift:
• post-pandemic economic uncertainty that shifted the power balance back to employers, prompting a deemphasis on certain recruitment and retention programs;
• a U.S. Supreme Court ruling in June 2023 that struck down affirmative action initiatives at colleges and universities; and
• political actions and lawsuits designed to reduce or eliminate investment in DEI programs.
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Concerned about lawsuits, some companies are reworking their DEI programs to de-emphasize hiring based on racial or gender goals, The Washington Post reported last month.
Over the past few years, U.S.-based Class Is have publicly talked about their efforts to widen their pool of job candidate recruits to attract younger workers to succeed veteran railroaders moving into retirement. And, as part of their ESG and sustainability initiatives, the companies have promoted their own DEI strategies.
Some Class Is leaders in recent years have stated that the industry’s aging workforce requires them to expand the pool of potential job candidates to include people underrepresented in the current workforce. They’ve also embraced diversity to tap into new ideas and innovations that improve operations, safety and profitability.
To see if their commitment or advocacy of DEI initiatives remains unchanged, RailPrime recently reached out to the four U.S. Class Is to inquire whether they’ve tweaked or changed their DEI policies since the Supreme Court’s affirmative action ruling in 2023.
Norfolk Southern Railway and Union Pacific Railroad did not respond to emails asking for comment. A BNSF Railway Co. spokeswoman said in a telephone call that the company would not comment on its DEI policies but directed RailPrime to the company’s website for information. And a spokeswoman for CSX said in an email there’s been no change in its DEI programs and initiatives over the past year.
Regardless of their response or lack thereof, all four Class Is discuss and/or describe their DEI strategies in annual reports and various places on their websites. Following are a few examples of their statements and positions regarding DEI.
BNSF Railway Co.
The first Class I to appoint a woman to the role of CEO, BNSF dedicates a section on its website to describing efforts and goals toward achieving diversity throughout the organization, including developing leaders who will ensure diversity and inclusion remain a priority.
“On a path of continuous improvement, we have strengthened leader accountability with diversity and inclusion being a part of our leadership model objectives,” the website states. “The success of our journey requires every BNSF team member to value the differences we each bring to the workplace. Diverse perspectives, collaborative environment and open mindedness help drive our spirt of innovation at BNSF.”
BNSF has two employee-led resource groups: the Diversity Council and Women EnRoute; and 10 business resource groups, including the Asian Pacific Islander Network, Black Organization for Leadership Development, Disability Inclusion Alliance, Hispanic Leadership Council, North American Nations, PRIDE+, and Women’s Network.
According to its 2023 Impact Report issued earlier this year, BNSF points out that nearly 40% of its management team is diverse; 26% of its nonmanagement team is diverse; 43.3% of new hires last year were diverse; and 65% of management trainee hires last year were diverse.
The report also mentions numerous awards the railroad received to recognize diversity and inclusion initiatives and for being a “best place to work” for diverse groups.
CSX
In its 2022 ESG Report, CSX discusses how it seeks to advance inclusivity as one of its “ONE CSX” principles that define the company’s workplace culture.
The company was recognized as a best place to work for people with disabilities, for women and military veterans.
“It is an honor to be recognized as an inclusive place to work, as it recognizes the hard work that we have put into making it happen,” CSX Vice President of Human Resources and Chief Diversity Officer Stephanie Noel says in the report. “Inclusion makes us a stronger company by tapping into valuable perspectives and solutions that come from a workforce with a wide range of backgrounds, experiences and abilities.”
CSX has been collecting data on its workforce, including information on race, ethnicity and identity affinities. As of Dec. 12, 2022, a breakdown of the railroad’s workforce of 22,542 employees showed that:
• Under-represented employees made up 22% of the total workforce, 45% of management new hires, 37% of union new hires and 35% of management promotions;
• People of color made up 18% of the total employees, 28% of management new hires and 31% of union new hires; and
• Women made up 5% of the total workforce, 21% of management and 2% of union.
In 2022, CSX recorded “incredible growth” in employee and community programs and a focus on development and expansion of its business resource groups BRGs. Those groups held over 40 events with over 2,000 employees involved.
“From professional development and personal interest activities to community engagement initiatives, the CSX BRGs helped drive a more supportive and inclusive workplace in 2022,” the report states. Also in 2022, CSX relaunched its Hispanic Origin/Latin American BRG.
Moreover, in August 2022, CSX signed the White House Talent Pipeline Challenge pledge, an initiative aimed at strengthening the nation’s infrastructure and supply chains by training and hiring skilled, diverse workers. Signing the pledge led to CSX increasing collaboration with Historically Black Colleges and Universities, the Congressional Black Caucus Foundation and the National Association of Black Accountants to build a more diverse talent pipeline.
Also in 2022, CSX announced $700,000 in funding for the diversity in business program at the University of North Florida’s Coggin College of Business.
Norfolk Southern Railway
On its website, NS describes its efforts to champion diversity and value inclusion. The company’s Inclusion Leadership Council is made up of members from diverse backgrounds, roles and locations across all departments who help spread a culture in which employees feel valued.
In a statement, NS observes the connection between a diverse and inclusive workforce and the company’s success: “An inclusive workplace where everyone’s experience and perspectives are valued makes for a stronger company with a brighter, more innovative future. We are dedicated to advancing diversity, equity and inclusion because our people and communities are at the heart of what we do — and because a diverse, inclusive workplace culture is critical to our success.”
Like the other Class Is, NS encourages employees to join one of its employee resource groups. In addition, NS leadership has promoted the value of DEI by signing the CEO Action for Diversity & Inclusion pledge; and President and CEO Alan Shaw has supported “open dialogue on complex, and sometimes difficult, conversations about diversity and inclusion,” as well as expanded unconscious bias education throughout the company.
Union Pacific Railroad
UP has been vocal about its DEI strategy, even announcing that it set goals to increase the number of women and people of color who work for the company by 2030. In 2022, UP released its first “We are One” Human capital report, in which it reported steps taken to create a more diverse and inclusive UP workforce. Included in the report were highlights of those DEI initiatives, including that nearly 50% of UP’s new hires were people of color and 13% were female; and that 50% of the company’s board is made of up diverse individuals.
This year, UP combined its "Climate Action Plan" and "We Are One" reports into its 2023 Building America Report. The other two were reported separately in 2022.
Within the 2023 Building America Report, UP discusses DEI initiatives as part of how it invests in its workforce. There, it describes DEI as “promoting a culture of equal opportunity, equitable employment and fairness to all irrespective of gender, race, religion, sexuality or disability.”
The report notes that DEI is not the job of just one department but the responsibility of all employees. In describing the company’s efforts to foster an inclusive culture, the report states: “We set aggressive diversity goals in 2020: to increase our people of color population from 29.4% to 40% and double our female population to 11% by 2030.”
UP reports the company made steady progress in 2023 by increasing its number of employees of color by 1%, “yet progress toward our female representation remains flat and challenging.”
The Class I will continue to work toward its goals by reviewing attrition rates by department; developing candidate pools reflecting broader market availability; removing predispositions from the hiring process; “creating an environment of belonging, so we do not erode our diversity through attrition;” and engaging department leaders so they understand the demographics of their departments and execute diversity action plans.
UP’s report also states that it embraces the notion that diversity “starts at the top” and actively seeks out highly qualified women and other diverse candidates for consideration as nominees to its board of directors.
In 2023, UP hosted nine employee resource groups and one business resource group, which are designed to promote a diverse environment. Combined, the groups claim more than 5,200 members — which rose 52% in 2023 and now includes all executives.
