Last week, Amazon’s board recommended opposing a shareholder proposal aimed at increasing the board’s diversity. This week, they’ve changed their tune.
After outcry from employees, shareholders, and even Congress, Amazon’s board has reversed an earlier decision against the adoption of the “Rooney Rule,” as proposed by CtW Investment Group. The rule would require the board to interview at least one woman or minority for each opening. Named after Dan Rooney, the former owner of the Pittsburgh Steelers and the former chairman of the NFL’s diversity committee, the rule has succeeded in changing the culture of the league, if not necessarily achieving full representation among its coaches and managers.
After Amazon employees aired their grievances on internal email threads, the Congressional Hispanic Caucus and members of the Congressional Black Caucus sent letters to the board on Friday urging them to reconsider. In response, the board announced on Monday that the Nominating and Corporate Governance Committee will adopt a new policy requiring them to see a diverse field of candidates for each opening, though they claim this policy was already informally in place.
In explaining its reluctance to support the proposal last week, the board cited the “complex considerations” involved in nominating new directors and argued that the rule “would not be an effective and prudent use of the Company’s time and resources” given its existing commitment to equality. All 10 members of the current board are white. Seven are men and three are women.
While the adoption of the Rooney Rule signals progress, some fear it’s not enough. The Harvard Business Review points out it creates a risk of “tokenism” or “box checking” and can actually reinforce status quo bias. Members of the Congressional Black Caucus who wrote to Amazon said “the Rooney Rule should be the floor, not the ceiling.”
Of the 17 companies Amazon identifies as peers, all have at least one board member who is a person of color.
