When governance speaks: Shareholder voting and market responses to DEI program elimination

• Extending Evans and Nochebuena-Evans (2025) through mid-2025, we incorporate shareholder proposals supporting further reductions in DEI-related practices and the associated voting outcomes. • Using an event-study framework, we show that DEI elimination announcements generate positive abnormal returns only when shareholders subsequently reject anti-DEI proposals. • Firms that do not experience such votes exhibit weak or statistically insignificant market reactions. • Markets condition their response to DEI reversals on shareholder governance signals rather than on managerial actions alone. We examine how financial markets price corporate diversity, equity, and inclusion (DEI) program eliminations once shareholder governance outcomes become observable. Extending Evans and Nochebuena-Evans (2025) through mid-2025, we incorporate shareholder proposals supporting further reductions in DEI-related practices and the associated voting outcomes. Using an event-study framework, we show that DEI elimination announcements generate positive abnormal returns only when shareholders subsequently reject anti-DEI proposals. Firms that do not experience such votes exhibit weak or statistically insignificant market reactions. Overall, our findings indicate that markets condition their response to DEI reversals on shareholder governance signals rather than on managerial actions alone.