Women, American Apparel, and the Danger of Advocating for Diversity

This week, two of my co-bloggers shared some great insights on the revamped American Apparel board of directors.  See Marcia Narine quoted in The Guardian article American Apparel adds its first woman to revamped board of directors; Joan Heminway, American Apparel 1, NFL 0. For those not following the American Apparel saga, the New York Times recently reported:

The founder and chief executive of American Apparel, Dov Charney, was fired this week because an internal investigation found that he had misused company money and had allowed an employee to post naked photographs of a former female employee who had sued him, according to a person with knowledge of the investigation. 

Beyond the public relations problems surrounding Charney’s departure, American Apparel is struggling financially as sales have dropped dramatically. As an initial step in trying start a turnaround, the company announced four new board members, including the company’s first female director, Colleen Birdnow Brown, former chief executive of Fisher Communications. 

When I opened the Guardian article quoting Marcia, I had another article open in the tab next to it from the Washington Post’s On Leadership section: For women and minorities, advocating for diversity has a downside.  That article explained:

In corporate America, diversity is about as controversial as motherhood and apple pie. CEOs love to tout the number of women in their upper ranks. Human resource departments like to trumpet their diversity programs in glossy reports.

But a new study finds that for female and minority executives, being seen as an advocate for diversity could actually have a downside. The researchers behind the study, which will be presented at the Academy of Management's annual conference in early August, found that women and minorities who were rated by their peers as being good at managing diverse groups or respecting gender or racial differences also tended to get lower performance ratings. That's because they may be viewed as "selfishly advancing the social standing of their own low-status demographic groups," the researchers write, a no-no when it comes to rating good managers.

Please click below to read more.

This research is, in itself, disappointing, but unfortunately not surprising. Obviously, Ms. Brown has a demonstrated track record of success that led American Apparel to seek her as a director, but this research suggests that her success could be lessened if she advocated for a more diverse board.  That’s too bad, because if that were her inclination (and I don’t know Ms. Brown), people should be listening to what she has to say on a whole host of topics, beyond (but including) who should be on boards of directors.  As an example, she has explained, "Companies need to care about their culture. They need to inspire their people so that everybody knows what is expected, the vision is clear, and the values of the company are established."

It’s worth noting here that it’s not just boards that have a lack of diversity.  The legal profession has long recognized a need for greater diversity among the ranks for partners and other leadership positions.  Recent ABA statistics show the legal profession as 66% male and 34% female.  In private practice, women are just 20% of the partners and 17% of the equity partners.  

For Fortune 500 companies, 21% of the general counsels are women. Such general counsels are overwhelmingly male (79%) and white (81.9%). For Fortune 501-1000 companies, the numbers are even more stark: Just 16% of GCs are female, while 91.7% are white and 83.2% are male. 

And it’s not just professionals; law schools have their issues, too. Female deans hold 20.6% of the positions available (maybe less).  For law schools, the ABA reports (Excel document here) the staff and faculty numbers are 55% male and 45% female, though that is potentially misleading, as men make up 67% of tenured faculty members. There is some progress being made, as the gender divide for non-tenured, but tenure-eligible faculty are 51.6% male and 48.4% female. Diversity numbers are similarly distributed, showing significant progress in the untenured ranks: ethnic minorities make up 16.8% of tenured faculties and 30.4% of non-tenured, but tenure-eligible faculty.

Lastly, for law students, women make up roughly 47% of the student population nationwide, though that number (despite significant effort) is noticeably lower here at my institution. 

In the business world, the legal world, and the academic world, we have made progress with regard to gender and ethnic diversity, but we still have work to do to create institutions that are representative of our nation’s population and the people each sector serves.  With the research suggesting that it harms females and minorities when they advocate for diversity, it seems appropriate that someone else should do it. So, that’s what I am trying to  do.