The rapid rise of Equality, Diversity and Inclusion (EDI) roles, strategies and mandates is the product of state intervention and government action, rather than consumer or business demand or rising prejudice, according to a new paper published by the Institute of Economic Affairs.

"EDI Nation: The growth of the equality, diversity and inclusion bureaucracy and its costs", by Alex Morton, argues that legislation such as the Equality Act’s concept of “indirect discrimination”, the Public Sector Equality Duty, and the purchasing power of the state have pushed organisations into EDI bureaucracy regardless of its value.

Quangos such as the Financial Conduct Authority and UK Research and Innovation have embedded EDI requirements far beyond their original remit, pressuring businesses, universities, and charities to follow suit. Companies have been forced to expand EDI by Government mandate rather than choosing to do this to boost productivity or as part of a meritocratic strategy.

Morton warns that this state-sponsored expansion is damaging productivity, creating division, and eroding meritocracy. While past research has estimated the direct cost of EDI roles and training in the public sector at £557 million a year, with wider costs to the economy potentially in the tens of billions, the paper stresses that the bigger danger is the replacement of merit-based hiring with identity-based quotas and targets.

One assessment found that the number of diversity and inclusion managers grew by 71% from 2015 to 2020 globally.

The paper recommends a reset, including:
Removing the legal concept of indirect discrimination
Ending EDI mandates within the public sector and procurement
Outlawing quotas and targets in hiring
Reform or abolition of the public sector equality duty
Clarifying that aims to hire more or less of specific groups is direct discrimination
Clarifying what charged topics such as racism and bullying consist of

Alex Morton, author of the report, said: “Far from reflecting market demand or rising intolerance, EDI has been driven by government policy and quango activism. It is costly, divisive, and undermines meritocracy - one of the pillars of modern economic success. Rolling back state-imposed EDI is essential if Britain is to restore fairness, efficiency, and economic dynamism.”