Microsoft To Tie Executive Bonuses to Company Diversity Goals

  • Percentage of women drops for second year on phone exit
  • ‘Very modest’ gains in percentage of racial minorities

Microsoft Corp. will tie executive bonuses to workforce diversity goals after the company saw a second consecutive year of declines in the percentage of women employees, owing to its exit from the phone handset market.

The percentage of women working at Microsoft fell to 25.8 percent from 26.8 percent of the company’s workforce as of Sept. 30, largely because the Nokia handset factories that Microsoft divested employed a larger number of women, said Gwen Houston, the company’s chief diversity and inclusion officer. Houston said she’s encouraged by an increase in women in technical and leadership positions, as well as in recent hiring trends.

Gwen Houston

Source: Microsoft

The percentage of African American/Black and Hispanic/Latino employees saw “very modest gains” of 0.2 percent to 3.7 percent of Microsoft’s total workforce and 0.1 percent to 5.5 percent of employees, respectively, Houston said.

“The modest gains for people of color -- those are so slight I really want to see them improve,” she said. “That’s an area of focus that I am really committed to.”

While the total numbers need improvement, Houston said new hires of women and racial minorities has increased. Women represented 27.7 percent of new hires this year and 21.7 percent of those hired for technical jobs. Of the new employees, 6.6 percent were African American/Black and 7 percent were Hispanic/Latino.

See also: Houston's blog on diversity

Chief Executive Officer Satya Nadella, after a bumpy start marked by a gaffe over equal pay at a women in tech conference, has made diversity a key priority for the company. He is expected later Thursday to detail a plan to make diversity goals one of the factors in whether senior executives get their full annual bonuses, Houston said. In addition to training for managers, Nadella talks about the diversity work at each of his monthly question-and-answer sessions with employees, Houston said.

“Diversity and inclusion is something you’ve got to ingrain, you’ve got to keep talking about the business value, you’ve got to keep talking about the impact,” she said. “That’s what Satya has been doing. We, of course, have more to do.”

To boost hiring of women and minorities, the company has added human resources workers with experience in that area, and Nadella funded the tripling of an internship program called Explorer for college freshman and sophomores interested in technology, Houston said. The company is also running focus groups in several U.S. cities with underrepresented groups to ask participants what would motivate them to choose careers in tech. The results will be used to improve advertising and recruiting campaigns.

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