The EEOC Investigates Racial Discrimination at Nike

Earlier this week the Equal Employment Opportunity Commission announced that it was investigating Nike for racial discrimination. 

The Equal Employment Opportunity Commission, born of the Civil Rights Act, said it was investigating “systemic allegations of D.E.I.-related intentional race discrimination” against white employees and job applicants at Nike…

The investigation is the most significant legal action that the commission has announced under Andrea Lucas, its chair, who has made diversity, equity and inclusion programs a target since taking the role last year. In a recent interview, she said: “It’s clear that I have priorities to deal with race and sex discrimination coming out of D.E.I.”

“The E.E.O.C. seeks information directly relevant to the allegations that Nike subjected white employees, applicants and training program participants to disparate treatment based on race in various employment decisions, including layoffs, internship programs and mentoring, leadership development and other career development programs,” the commission said in its motion filed Wednesday.

Nike has long made DEI issues a central part of its marketing. Most remember their campaign featuring Colin Kaepernick, the quarterback who refused to stand for the national anthem prior to games to protest racial discrimination. But there have been many similar examples.

In 2019, Nike released another ad supporting the US women’s national soccer team’s “fight for pay equity.”

“Women will conquer more than just the soccer field by breaking every single glass ceiling,” the narrator in the ad said. “One of the spot’s most striking images is of a young girl standing in a stadium, holding a sign that reads ‘Equal Rights.'”…

Following George Floyd’s death in 2020, Nike flipped its famous slogan to “Don’t Do It.” The brand released the following text-only video about supposed racism in America:

“For once, Don’t Do It. Don’t pretend there’s not a problem in America. Don’t turn your back on racism. Don’t accept innocent lives being taken from us. Don’t make any more excuses. Don’t think this doesn’t affect you. Don’t sit back and be silent. Don’t think you can’t be part of the change. Let’s all be part of the change.”

None of that is illegal. Companies are allowed to promote whatever social views they want to promote. Where it might cross a legal line is when race is used as a factor in hiring or promotion.

In 2021, Nike presented a five-year plan for a more diverse work force. Management tied some executive compensation to diversity objectives, which included representation for women in leadership positions and a target of 35 percent representation of racial minorities in its U.S. work force.

Here’s a bit of what that initiative sounded like at the time:

Nike has created a diversity roadmap that aims to reach 49.5% female employees across the enterprise, and to make the U.S. VP leadership consist of at least 29% racial and ethnic minorities, by 2025. The retailer will enforce the Purpose 2025 Targets program by tying diversity, as well as environmental and ethical goals, to executive compensation for the first time.

“As our society continues to reckon with systemic racial injustice, we are committed to standing up for one of Nike’s core values — equality,” said John Donahoe, President and CEO of Nike in a statement

Nike seems to have been aware that this five-year plan might be a problem. Last year they didn’t release an update on their progress.

Last year, after Mr. Trump returned to office, Nike decided not to release an annual corporate sustainability report that was expected to provide updates on those diversity initiatives. The company said at the time that it was still committed to those objectives.

It’s worth noting that the old line about going woke and then going broke seems to hold true here. Nike share prices peaked in 2021, a few months after the new DEI hiring plan went into place. Share prices have been on a long slow decline ever since. In 2024 the company replaced its CEO and announce a reorganization effort intended to get back to basics.

Nike CEO Elliott Hill, who took the helm in October, outlined plans to revamp the sneaker giant in a Thursday earnings call, where he promised investors that the company would shift focus and resources to make “sport our North Star” again…

Hill, a longtime Nike executive, was brought back to help the Oregon based sportswear company regain its footing and revive the brand after “several quarters of weak sales,” which has taken a hit as competitors step in with more innovative footwear…

“We lost our obsession with sport,” Hill said. “Moving forward, we will lead with sport and put the athlete at the center of every decision. The sharpness in each sport is what differentiates our brand and our business and fuels our culture.”

Gee, I wonder what they got focused on besides sports. It’s a mystery.

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