Companies Grapple With Diversity Questions After U.S. Election

  • Hundreds of employee emails ‘raising concerns’ at one company
  • Trump will name new heads of EEOC, Labor, Justice departments

Apple CEO Tim Cook.

Photographer: David Paul Morris/Bloomberg

Chief executive officers at some of the largest U.S. companies, from General Electric Co. to Apple Inc., are reassuring employees they support workplace diversity as a salve to anxieties caused by the bruising presidential election.

Jeffrey Immelt affirmed GE’s commitment to “people of all races, genders and sexual orientations” in an internal blog post Wednesday musing on the election. That echoed Apple CEO Tim Cook’s message to workers that the tech giant welcomes everyone, “regardless of what they look like, where they come from, how they worship or who they love.” Oscar Munoz of United Continental Holdings Inc. said in a message to employees that they represent “every creed and conviction, background and belief.”

Diversity issues have come to the fore as the presidential campaign exposed and deepened bitter divisions on matters such as the treatment of women and minorities; the rights of lesbian, gay, bi-sexual and transgender workers; and gender disparities on the job. Following Donald Trump’s surprise victory over Hillary Clinton this week, companies now are grappling with how to ease tensions and move forward.

Thousands of people in cities including Boston, Chicago, Seattle and New York have marched, shut down highways and burned effigies of Trump to protest the electoral shift to the right.

‘Areas of Angst’

Starting about midnight on Tuesday, Karyn Twaronite, global diversity and inclusiveness officer at consulting and accounting firm EY, said she received hundreds of emails from employees “raising concerns, thoughts and observations” as well as “areas of angst.”

“I’m actually hopeful, because there’s so much dialog. We’ve been able to have conversations about subjects people never talked about before, like racism and sexism,” Twaronite said, adding that about two-thirds of EY’s employees are millennials.

There’s still cause for concern. Advocates of diversity see major changes in workplace regulations if Trump follows through with his pledge to rescind Barack Obama’s executive orders, which could include the ones in the table below. And it’s still legal in 28 states to fire workers because they are gay.

DATEEXECUTIVE ORDER
July 21, 2014Amendments to Equal Employment Opportunity Executive Orders 11478 substituting “sexual orientation, gender identity” for “sexual orientation” and to 11246, substituting “sex, sexual orientation, gender identity, or national origin” for “sex, or national origin”
Aug. 18, 2011Establishing a coordinated government-wide initiative to promote diversity and inclusion in the federal workforce
Mar. 11, 2009Creating the White House Council on Women and Girls: Includes assisting women-owned businesses to compete internationally and working to increase participation of women in the science, engineering and technology workforce

Trump will appoint his own attorney general and can name a new general counsel and chairman for the Equal Employment Opportunity Commission, as well as change the leadership of the Department of Labor and National Labor Relations Board. The NLRB exerts broad influence over workplace issues, and the Department of Justice wrote key guidelines this year requiring the government to treat sexual orientation and gender identity as protected under the Civil Rights Act.

During Obama’s two terms, the Justice Department and EEOC have taken the lead on discrimination cases involving religion, gender identity, sexual orientation and race -- including high-profile diversity lawsuits against McDonald’s Corp., Abercrombie & Fitch Co. and AutoZone Inc.

Aggressive Enforcement

“The biggest effect will be in the agencies -- the NLRB, DOL and EEOC -- that have all been very aggressive in enforcing the laws,” said Cliff Palefsky, a civil-rights lawyer at McGuinn Hillsman & Palefsky in San Francisco. “I suspect we’re going to go back eight years, to when those agencies actually worked to undermine the laws. That’s unfortunate.”

Matt Maloney, head of food-delivery company GrubHub Inc., generated controversy after the election with an email to employees decrying “the nationalist, anti-immigrant and hateful politics of Donald Trump” and said workers who don’t support a culture of inclusiveness should “reply to this email with your resignation because you have no place here.” In a statement posted Thursday on the company’s website, he clarified that GrubHub welcomes people of all political affiliations and the initial message was not meant as an attack on Trump voters.

Move Past Rancor

Many CEOs sidestepped specific comments on Trump and instead asked workers to try to move past the partisan rancor of the campaign. Starbucks Corp.’s Howard Schultz, who endorsed Clinton, told employees in a letter that “we have a choice in how we treat one another,” regardless of which candidate they supported.

Companies increasingly recognize the need for employees to reflect their customers, and recruiting more women, minorities and people of different sexual orientations can help them stay competitive and innovative.

“It’s a business imperative,” said George Nichols, senior vice president of government affairs at New York Life Insurance Co. “Businesses that don’t invest in diversity efforts will increasingly be at a competitive disadvantage, regardless of the political landscape.”

The company held a town-hall meeting Thursday at which CEO Ted Mathas reiterated its commitment to a diverse workforce, Nichols said.

Timothy Ryan, U.S. chairman at PricewaterhouseCoopers LLP, encouraged employees to talk about their feelings the day after the election. “We’re doubling down” on diversity, he said in an interview. Some 44 percent of the new partners PwC named this year were women or minorities, while 47 percent of its workforce is female and 33 percent are minorities, he added.

More Innovation

“We and other companies understand the importance of diversity and inclusiveness to get more innovation, better answers to problems and to reach more customers -- and that’s not going to change,” he said.

Trump’s candidacy inflamed racial tensions as he demonized Mexicans as rapists and Muslims as terrorists while also expressing support for police practices such as “stop and frisk,” which some consider a form of racial profiling disproportionately targeting blacks and Hispanics. Trump also was criticized on gender grounds, particularly following the release of a recording in which he makes vulgar comments about groping women.

Corporate boards have been unforgiving with some top officials who engaged in arguably less crude behavior that could paint the company in a bad light or put it at legal risk.

Read more: Sex, the C-Suite and Trump

While the tone from the campaign was “disturbing,” it may not stop the progress toward a more diverse workforce, said Natasha Lamb, director for equity research and shareholder engagement at Boston-based Arjuna Capital, who filed nine diversity-related shareholder resolutions at technology companies this year.

“Investors are part of a greater groundswell that is emboldening corporations to plot a more diverse and successful future,” she said. Following the election, “our work on gender equity is more important now than ever.”

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