While President Donald Trump continues unraveling the discriminatory DEI practices throughout the federal government and society, a recent lawsuit is calling Illinois to task.
In January, the American Alliance for Equal Rights filed a lawsuit against Illinois challenging a law that requires nonprofits to publicly disclose the demographic makeup of their board of directors. Such demographics – which include board members’ race, ethnicity, gender, disability status, veteran status, sexual orientation and gender identity – remain publicly available and easily searchable for three years. And this week, Trump’s Department of Justice, led by Attorney General Pam Bondi, joined the lawsuit, continuing their pledge to roll back policies that encourage discrimination.
Philanthropy Roundtable has been closely monitoring this issue since last spring when it passed in the Illinois state legislature, months before the law’s effective date January 1, 2025. Mandating the disclosure of nonprofit board demographics poses significant concerns for donors and the philanthropic community. Such requirements compromise the privacy of board members by compelling them to share sensitive personal information publicly.
This invasion of privacy may deter qualified individuals from serving on boards, consequently limiting a variety of perspectives essential for effective governance. Moreover, imposing demographic reporting mandates distracts nonprofits from their core missions, forcing them to focus on compliance rather than community impact.
Megan Schmidt, senior director for government affairs at Philanthropy Roundtable, says nonprofits must retain the autonomy to advance True Diversity, which values people based on their unique skills, backgrounds, perspectives and personal experiences that align with and advance the organization’s mission. She says imposing arbitrary government mandates on board composition erodes this freedom, forcing organizations to prioritize arbitrary demographic mandates over the qualifications that truly drive impact.
Similarly, Edward Blum of the American Alliance for Equal Rights says such mandates compromise the integrity of board selection processes by shifting the focus from individual merit – such as talents, expertise and genuine interest in the nonprofit’s cause – to fulfilling superficial demographic quotas. This approach risks diluting the effectiveness of nonprofit leadership and perpetuates a reductive view of diversity that prioritizes appearances over substantive contributions.
Demographic mandates are not only unconstitutional but are also fundamentally opposed to America’s founding principles. While the philanthropic sector values and strives to celebrate diversity, requiring the disclosure of board demographic composition undermines these efforts. Nonprofits are most effective at supporting their communities when they have the freedom to focus on innovative solutions and strategies, unburdened by mandated checkboxes. Legislation such as this Illinois bill hinders the vital work of charitable organizations, creating unnecessary obstacles that ultimately do more harm than good. The Roundtable will continue to monitor the new litigation and push back against government DEI mandates on philanthropy.
Philanthropy Roundtable’s True Diversity initiative is an equality-based, holistic framework for embracing diversity. It values every person as a unique individual and empowers charitable organizations with the freedom and flexibility to advance their missions and help those in need.
