On the heels of a year that the company described as both “challenging and inspiring,” Nike Inc. is making progress.
In April 2018, after a series of executive departures — widely viewed as the result of management’s need to clean house due to internal behavioral challenges — Nike admitted that it had fallen short in promoting women and people of color. Last July, it announced a plan to raise salaries for 10 percent of its workforce to help correct pay inequity.
In an annual report, dubbed Nike Impact, the brand this week offered an update on its newly accelerated goal of attracting and developing “an increasingly diverse, engaged, and healthy workforce.”
Over the past year, Nike said it increased VP-level representation of women by 4% to 36% globally and VP-level representation of U.S. underrepresented groups by 3% to 19%. The brand also succeeded in reaching global pay equity ratio for men to women, and white to underrepresented groups in the U.S. (In the United States, women still earn about 80 cents to a man’s dollar, according to data from the Institute for Women’s Policy Research.)
Still, CEO Mark Parker said, in an open letter released in tandem with the report, that the company “can do better” and that “incremental change is not enough.”
The make-up of Nike’s workforce, like many of its peers, sees diversity levels fall off at the higher ranks of the organization — whereas lower-ranking staffers tend to be more diverse. For example, Nike’s 2018 report estimates it employs about 7,161 Black/African American employees in the U.S — but only 198 of them are director level and above while just 28 are VPs. Similarly, it employs about 6,115 Hispanic/Latino staffers but only 220 are directors or higher and just 10 are VPs. Meanwhile, of 14,630 White employees at Nike’s U.S. operations, 3,270 are at the director level or higher and 271 are VPs. (In total, Nike has 4,416 director level or higher ranked employees and 344 VPs in the U.S., per 2018 data provided this week.)
To that end, Nike’s chief said the firm will continue to take “intentional action” to increase representation, particularly at the leadership levels.
“That includes continuing to expand our pipeline of diverse candidates … It also includes holistic approaches across our organization — from mitigating potential bias in the interviewing process to increasing training programs that will help strengthen a culture of belonging,” Parker wrote.
The company said it has made a significant investment in its Diversity Sourcing and Programs Team, aimed at developing a pipeline of diverse external candidates at leadership levels. And in June 2018, it launched Amplify, an internal development program for high-potential women and minorities at the director and senior director levels. It also initiated employee mentoring programs in New York, Los Angeles, Memphis, and at Converse headquarters in Boston, with a focus on career development.
Despite progress, Nike will likely have its work cut out for it as it continues to wade through a legal imbroglio that followed the management shakeup last year.
Two former employees, Kelly Cahill and Sara Johnston, filed a lawsuit against the sportswear giant last August alleging that it “intentionally and willfully” discriminated against women with regard to pay and promotions, and that its majority-male executives fostered a hostile work environment at its Portland, Ore., headquarters.
Since then, two more women and former Nike employees — Lindsay Elizabeth and Heather Hender — have been added to the suit as plaintiffs, and all four women’s attorneys have been seeking class action status for the complaint.
A second sweeping suit came in September when three Nike shareholders sued Nike founder Phil Knight, CEO Mark Parker and former Nike brand president Trevor Edwards, as well as the company’s board, alleging that they “facilitated and knowingly ignored the hostile work environment that has now harmed, and threatens to further tarnish and impair, the company’s financial position.” That suit was thrown out without prejudice last month — although the plaintiff’s attorneys said they plan to re-file.
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