Banning legacy college admissions could provide a much-needed boost to employers’ hobbled DEI efforts

Good morning.

When the Supreme Court struck down race-based admissions at U.S. universities last year, it was only a matter of time before attention turned to legacy admissions—the practice of giving preference to applicants whose family members are alumni. Sure enough, Connecticut lawmakers are now advancing a bill to ban the use of legacy and donor preferences in admissions to all colleges and universities across the state, including Yale University. Virginia’s ban on legacy admissions at public universities was signed into law last week. (Colorado banned the practice in 2021.)

The popularity of legacy admissions has everything to do with brand. These are coveted slots because they are proven catalysts for success. The practice of giving legacy candidates a boost is especially prevalent among elite private institutions. At Harvard, for example, legacy students make up less than 5% of applicants but are around 30% of those admitted. It’s been a successful loyalty program that’s increasingly perceived as toxic to the brand. Harvard is now being sued over its legacy policies, having been targeted for race-based policies.

For companies that have been struggling with the implications of affirmative action rulings on DEI, chipping away at legacy admissions could be a good thing. Many of the CEOs I talk to want to increase diversity in their companies and address inequality in society. The challenge is that it’s become harder to talk about and legally trickier to pursue. Many leaders felt forced to scale back race-based hiring programs after the Supreme Court ruling, with some removing racial criteria for applicants altogether. Recruiting from schools accused of bolstering privilege doesn’t help in this environment.

Competitive schools tend to attract high-performing students who can be terrific employees. Those students suffer when people think they’re there because of mom or dad. Employers suffer when it looks like the system is rigged. The erosion of legacy admission could strengthen the credibility and diversity of top-tier schools, from which many employers recruit.

Let’s face it: There are a lot of great schools out there that groom a lot of great leaders. Of the 2023 Fortune 100 CEOs, only 11.8% attended an Ivy as undergrads, and only 9.8% hold an Ivy League MBA, according to Dartmouth professor David Kang.

The data underscores a point that Jack Welch, the former chief executive of GE, made in one of my first interviews with a CEO. He preferred to hire people who were at the top of their class in a public university than an Ivy League grad because he felt it was a sign of talent and grit. There’s plenty of talent and grit at Ivy League schools. Without legacies to cloud the debate, it’s easier to see.

Diane Brady
@dianebrady
diane.brady@fortune.com

This story was originally featured on Fortune.com