Business leaders reject U.S. push against diversity
The U.S. government has sent letters to companies in Portugal that provide goods and services under federal contracts, urging them to dismantle their diversity, equity, and inclusion programs.
Portuguese business leaders are pushing back against recent pressure from the Trump Administration, which has instructed companies with U.S. government contracts to dismantle their diversity, equity, and inclusion (DEI) programs.
The U.S. Embassy in Lisbon confirmed to ECO that it is conducting a review of contracts involving U.S. suppliers, requiring companies to certify compliance with Executive Order 14173, signed by former President Donald Trump in January.
This executive order mandates the elimination of DEI programs across U.S. federal departments and agencies, citing concerns that such programs could foster discrimination and undermine merit-based opportunities.
The order specifically targets policies that involve racial and gender-based preferences, which it claims may violate civil rights protections and national unity by rejecting traditional American values such as hard work, individual achievement, and meritocracy.
The letters sent to businesses in Portugal have sparked reactions from executives and associations asserting that the U.S. should not dictate the policies of European companies.
Call for European strategic autonomy
Armindo Monteiro, president of the Confederation of Portuguese Employers (CIP), emphasized that “the United States should not determine the rules in Europe,” underlining that Europe has its own history and civilizational context.
Monteiro further argued that Europe, with its rich historical legacy, should chart its own course instead of following Washington’s dictates.
Álvaro Mendonça e Moura, president of the Confederation of Farmers of Portugal (CAP), echoed Monteiro’s sentiment, stressing that it should be Europe defining its policies rather than following the whims of U.S. political shifts, especially in the current political climate.
“Europe needs to increase its strategic autonomy, particularly in the context of food sovereignty,” Mendonça e Moura said, drawing attention to the importance of securing Europe’s independence, particularly in critical sectors like agriculture and food production.
Carla Tavares, president of Portugal’s Commission for Equality in Labor and Employment (CITE), expressed deep concern about the U.S. actions, calling them an “unacceptable interference” in European internal affairs.
Tavares warned that this pressure could signal a “retreat in human rights,” and expressed concern over the potential erosion of social progress made in Europe over the years.
The Portuguese Diversity and Inclusion Association (APPDI) also voiced its alarm, with Mónica Canário, the organization’s project coordinator, describing the letters as “a lack of respect for the sovereignty of countries and organizations.”
The association emphasized the importance of maintaining DEI policies to ensure equal opportunities for all, regardless of background, and rejected the idea that they could be dismantled under external pressure.
Despite the backlash, the Portuguese government has largely remained on the sidelines of the controversy.
When asked about the U.S. pressure during a recent meeting of the Council of Ministers, Economy Minister Pedro Reis responded evasively, choosing not to take a firm stance on the issue.
“In a time when the world needs bridges and investment, not tariffs, I won’t contribute to any rhetoric that distances us,” said Siza Vieira, focusing instead on the need for Portugal, the European Union, and their businesses to strengthen their relationships rather than finding points of contention.
Companies concerned
Despite the push back, companies expressed concern about the impact of the measure in Portuguese exports.
Several Portuguese companies with U.S. government contracts, including major corporations such as Vodafone Portugal, Mota-Engil, and Galp, are now grappling with the dilemma of whether to comply with U.S. directives to abandon their DEI programs or risk losing vital contracts.
While many companies have declined to comment on the matter, some, speaking anonymously, expressed surprise at the directive and growing concerns about how it might affect their operations and reputations.
The dilemma is compounded by the fact that these companies have implemented DEI initiatives often in response to requests from other international partners, not just the U.S. government.
This leaves them in a precarious position, as they must weigh the potential fallout from either complying with the U.S. directive or maintaining their commitment to diversity and inclusion, which could lead to reputational damage and loss of business opportunities in both Europe and the U.S.
It also raises critical questions about the sovereignty of European countries to set their own policies and the influence of global powers like the U.S. in shaping corporate practices across the world.
As these discussions unfold, it remains to be seen whether Europe will maintain its commitment to DEI principles or yield to external pressures, particularly in the face of growing diplomatic and economic tensions.
A Legal and Political Grey Area
Can the U.S. legally impose these restrictions on European companies?
Speaking to ECO, José Luís Cruz Vilaça, a lawyer with Antas da Cunha Ecija and former EU Court judge, argued that the U.S. can, in practice, condition its contracts based on its own legal framework.
“Those who don’t comply are simply not accepted as suppliers,” he told ECO.
However, he noted this places European firms in a difficult position, caught between EU directives promoting DEI and U.S. federal rules seeking to dismantle them.
“This is fundamentally a political issue, where legal principles clash with power dynamics. Eventually, EU governments and institutions may have to step in — and even retaliate if necessary,” he warned.
But not all legal experts agree.
Márcia Martinho da Rosa, from MMR Legal Services, argues the letters have no binding legal force within the EU, calling U.S. interference in internal DEI matters “inconceivable.”
Luís Couto, a partner at SPCB Legal, offered a more nuanced view.
He explained that the enforceability of the executive order depends on which legal framework governs the contract, U.S. or European law.
“If the contract is governed by U.S. law, then yes, the executive order can apply. If not, the imposition becomes much harder to justify,” he said.
Protest draws parallels with April 25 Revolution
Meanwhile, on Saturday, hundreds of Americans expats gathered in several locations across Portugal to protest against the Trump administration.
The demonstration, organized by activists living in Portugal, was filled with references to the April 25 Revolution and the importance of freedom of expression.
Caryl Hallberg, 73, a Democrat who chose Portugal as her home after four years of traveling across Europe, was one of the protest organizers.
According to Observador, she told Lusa: “It’s a special place. During a dinner, some friends told me about the story of the Carnation Revolution, and I thought, 'This is where I want to live.’”
Although she distanced herself from the party, Caryl has always been involved in activism, having joined the Democratic Party to support former President Barack Obama's candidacy for the White House.
Caryl believes it’s possible to combat Donald Trump’s policies from abroad, alongside fellow Americans who are alarmed by the current direction of U.S. politics.
“We know what fascism is, and that’s what is happening,” she said, expressing concerns about cuts to pensions, which she claimed have already affected some Americans living in Portugal.
She also criticized Trump for “destroying trade” through tariffs and for causing the depreciation of the U.S. dollar, which she notices every time she exchanges dollars for euros.
Holding up signs under the slogan “Hands Off,” demonstrators urged the Trump administration to “keep its hands off” the U.S. Constitution and civil rights.
“We will continue to protest peacefully. We follow the example of Portugal,” Hallberg assured.
Jaiy Conboy, 72, also participated in the protest, playing a song he composed for the occasion, titled “I Will Not Be Silent.”
Conboy, an academic who has spent much of his life working with Portuguese universities and is married to a Portuguese woman, expressed his outrage over Trump’s actions.
“I am appalled by what he is doing to the world economy, by befriending enemies like Putin, and by how he is ignoring the Constitution,” he said.
According to the organizers, around 700 people participated in the protest, holding up signs, some featuring carnations as a nod to the Revolution, and slogans about freedom of expression. The message to Americans was clear: "What America needs, Portugal knows."