Black Experience

Nike Has Problem with Hiring, Promoting Women, Minorities to Senior Levels

Nike Inc.’s HR Chief Monique Matheson informed employees on Wednesday that the company has failed in both promoting and hiring women and minorities to senior-level positions.

But this is not surprising as Nike’s executive leadership team is predominantly white and male. Mark Parker, the company’s chairman, president and CEO since 2006, apparently has not made diversity a priority.

“While we’ve spoken about this many times, and tried different ways to achieve change, we have failed to gain traction — and our hiring and promotion decisions are not changing senior-level representation as quickly as we have wanted,” Matheson wrote in the memo obtained by CNBC.

The world’s largest footwear maker plans to begin change with increasing the representation of minorities at the vice president level in order to spur a “trickle-down effect,” the memo said.

“Twenty-nine percent of Nike vice presidents are women, and in the U.S. 16 percent are people of color,” according to CNBC. “Nike only tracks race and ethnicity information in the U.S.”

In comparison, at DiversityInc Top 10 companies the percentage of women in level four management (three reports removed from the CEO) is 44.8 percent, and people of color represent approximately 28 percent (6.7 percent Black, 7.3 percent Latino, 14.7 percent Asian).

Despite the lack of diversity in senior-level positions, Nike continues to promote a façade, through its advertisements and endorsements, that it believes in diversity and inclusion. For example, tennis great Serena Williams, a longtime advocate for women and girls, has a line of clothing with Nike. And NBA stars LeBron James and Kevin Durant are both Nike-sponsored athletes.

These athletes will have to decide if they will hold Nike accountable to its claim that it will increase the representation of woman and minority executives.

But despite the endorsements of outstanding American athletes, in 2017, Nike’s sales in North America, its largest market, steadily declined.

A parallel can certainly be made between the lack of diversity in the company’s leadership and its struggle to stay relevant in the North American market.

For the past 17 years, DiversityInc has recognized the nation’s top companies for diversity and inclusion management. These companies excel in hiring, retaining and promoting women and minorities. Nike has never participated in DiversityInc’s Top 50 process.

“Research shows that these most diverse companies tend to actually perform better financially than the overall market,” CNBC reporter Bertha Coombs said during DiversityInc’s event in 2017.

“The [DiversityInc] Top 50 stock index, analyzed by CNBC’s market services group, shows that longer term, three to five years, those companies on the DI Top 50 list of the most diverse companies outperform the overall market by a healthy margin.”

While the one-year return of nearly 10.4 percent for the Top 50 index is slightly lower than the S&P’s 11.8 percent and Dow’s nearly 14 percent, it’s certainly competitive, Coombs said, adding that the DI Index three-year return of nearly 28 percent outperforms the S&P 500’s 26 percent and the Dow’s 25 percent.

“When you look at the five-year long-term return, the DI Index totally outperforms,” she explained. “79 percent, compared to S&P’s 69 percent, and the Dow, only 57 percent.”

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