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For all the advances Amazon has made, it still can’t seem to figure out diversity. The $800 billion tech giant employs more than 600,000 people and serves millions, but its leadership has one core demographic. Besides CEO Jeff Bezos, there are five other figures at the top of the company who make consumer-facing decisions, and each of them is a white man.
According to reporting this January from Eugene Kim at CNBC, of the 48 executives in Amazon’s upper ranks, almost all of them, like Bezos, are white men. (There are two other Jeffs as well: Jeff Blackburn and Jeff Wilke.) Kim found that four of those 48 executives are women, and Bezos’ only female direct report is Beth Galetti, Amazon’s senior vice president of human resources. There are no African-Americans among its VP-level executives, and only a few are of Asian descent.
OneZero reached out to Amazon about its leadership. A spokesperson declined to comment on the record.
While Bezos asserted Amazon’s commitment to diversity in the wake of the 2016 election, the company has resisted calls to make progress — including some from its own shareholders. In April 2018, a proposal from CtW Investment Group, an Amazon shareholder that works with union-based pension funds, asked Amazon to put in place a “Rooney Rule” — a policy borrowed from the NFL that requires teams to interview minority candidates for coaching and operations jobs. CtW similarly wanted Amazon to codify a rule requiring the company to interview candidates, including women and people of color, for director positions. In response, Amazon’s board recommended a vote against CtW’s proposal.
“Our processes for nominating directors involve complex considerations that are designed to advance the long-term interests of shareholders,” the company said in a statement, which immediately set off internal revolt among Amazon employees. “What exactly is the complex process that we currently use to find and vet talent that we are so proud of?” one employee rhetorically asked an Amazon communications representative.
Amazon ultimately did an about-face, agreeing to adopt a practice to include women and minorities when considering new board candidates. Facing increased pressure to diversify, Amazon became the latest major tech company to have a black board member, naming Starbucks exec Rosalind Brewer earlier this month. Brewer is the second black board member in Amazon’s 24-year corporate history; the first, Myrtle Potter, the former president and COO of Genentech, was appointed in 2004 and stepped down in 2009.
Neither Brewer nor Potter responded to a request for comment.
But Amazon’s diversity problems extend well beyond Bezos’ closest confidantes: A 2018 Bloomberg piece found that according to numbers the company submitted to the government, 73 percent of Amazon’s corporate employees — those who do not work as contractors or in the company’s warehouses—are men, as are 78 percent of senior executives and managers. Besides the hard numbers, this lack of diversity is reflected in other ways. In 2015, Jacob Demmitt at GeekWire obtained public records indicating that Amazon headquarters employees’ most consistent complaint to the Washington State Department of Labor is that there weren’t enough bathrooms to accommodate male employees. At weekly Amazon Web Services meetings, Bloomberg reports, there are only ever a handful of women present.
In 2019, corporate diversity is more than box-checking. And there are ample reasons why diversity makes business sense. Diversity improves management, experts say, and a greater variety of perspectives and backgrounds has been shown to result in better decision-making.
A McKinsey study last year found that companies with diverse executive teams posted bigger profit margins with better financial returns than less diverse companies, and a 2014 study conducted by MIT economist Sara Ellison found that gender diversity in office settings boosts productivity. One potential reason: “Men and women employees tend to bring different life experiences, skill sets, and interest sets to the workplace,” Ellison tells OneZero. “If you have a workplace with both men and women in roughly equal numbers, you’ll have a wider portfolio of these life experiences and interests. Maybe just having that wider portfolio can be valuable.”
“If you aren’t reflective of your customer base, and you’re not representing your worker base, you’re not building the best company possible.”
“Amazon was established at a time when women were leaving the study of computer science,” Ellison tells OneZero. “I think it was maybe not so unnatural, if that was the pool you were drawing from, for your pool to be sort of white and male. Our research suggests that having a more diverse workforce, not just in terms of gender but in terms of other demographics, can enhance your firm’s bottom line.”
Richard Warr, head of the Department of Business Management at North Carolina State’s Poole College of Management, co-authored a 2018 study that came to similar conclusions: Being inclusive makes a company more innovative in terms of product innovations and patent creation.
“Our main finding is that firms that promote diversity tend to have, all else equal, greater innovations in the future and that these firms tend to be more valuable,” Warr says. “This finding occurs throughout the economy and isn’t restricted to the tech sector: As long as the firm is in an industry where innovation matters, then we can say that diversity should matter, too.”
No one could argue that Amazon hasn’t been a massive business success. But Ellen Pao, the former Reddit CEO who co-founded the diversity nonprofit Project Include, says that it’s in spite of its lack of diversity. Pao filed a lawsuit against her former employer, the storied venture capital firm Kleiner Perkins Caufield & Byers (now Kleiner Perkins), and lost the case in March 2015 when a jury found Kleiner Perkins not liable for all four of Pao’s claims, including retaliation and failure to prevent retaliation. A few months later, she dropped the suit and decided not to appeal.
“All these companies have increasing stock prices,” Pao tells OneZero. “You wonder, though, how much more value they could have generated if they had been inclusive from the start. If you aren’t reflective of your customer base, and you’re not representing your worker base, you’re not building the best company possible and the best business possible.”
Pao says criticism of Amazon in recent years — including employees in Amazon warehouses complaining about not being paid a living wage or working in hazardous environments — comes, in part, from the fact that the company isn’t inclusive at the top and isn’t making decisions that reflect varied groups of people.
“You look at what’s happening with Airbnb, Nextdoor, Google, and Facebook,” says Pao, referring to issues like charges of racial profiling and privacy concerns. “The problems are generated by the fact that they don’t have people of color leading or shaping these products. There are so many opportunities out there that people are missing. It’s so broken, it’s hard to articulate.”
Both Airbnb and Nextdoor have grappled with issues pertaining to racial profiling on their respective platforms. Some people of color who have uploaded profile pictures on Airbnb’s platform have been turned away from multiple Airbnbs when requesting reservations, while Nextdoor grapples with posts targeting people of color. Industry onlookers and critics have noted that such instances are potential downstream effects of a lack of diversity.
Meanwhile, both Google and Facebook are basically as white and male as they’ve ever been: According to its fifth annual diversity report, issued last year, Google reported that women make up 30.9 percent of its global workforce, one-tenth of a percentage point higher than in 2017; the company is also 2.5 percent black and 3.6 percent latino in its U.S. offices, both a one-tenth percentage point increase from 2017. Facebook’s numbers are similar: As of July 2018, women made up 36 percent of the workforce, and black employees made up 4 percent of the total head count, while Latinos made up 5 percent.
Pao notes recent unrest at companies like Amazon, where employees have protested the company’s work with the Department of Homeland Security and the lack of diversity on its board, and Google, where employees held a walkout in November to protest the company’s handling of sexual misconduct allegations. Over the long run, experts say that ignoring those employees will hurt the bottom line.
“Is that the company you want to build?” Pao says. “All your friends are in a close, tight-knit circle at the top, but underneath you, everyone is churning. It’s widely talked about that at Amazon, you can poach an employee after two years, because they just grind them out.”
A more diverse company, especially one where women and people of color are represented both in the workforce and executive ranks, isn’t just a good thing in terms of social justice or economics or productivity. It may also make for employees who are more happy and less likely to leave after a year or two. And it makes some of the most important companies on this planet — the ones shaping how we do business and communicate — more reflective of the billions of people they serve.