Alphabet, Inc. – Board Diversity (2018)
Outcome: Withdrawn following the Board’s action in April 2018 to appoint Sundar Pichai to the Executive Committee of the Board – a step toward expanding diversity at the highest governance level.
Google and Alphabet have come under heavy public scrutiny for the lack of diversity and equal pay amongst its employees. This prolonged and at times dramatic attention has come from the public-at-large, employees, investors, the press, and the government. The Department of Labor is currently investigating Google for violating federal employment laws by permitting pay differences to occur between men and women in the company. In August 2017, the issue reached crisis levels when a Google engineer posted a memo questioning the company’s diversity efforts. The Wall Street Journal described the episode as a “firestorm”.
As the first major Silicon Valley technology company to release diversity statistics in 2014, the Company has gone to great lengths to demonstrate its desire to address its diversity challenges. These efforts include unconscious bias training aimed at improving hiring programs, inclusion policies and practices, education outreach, and community relations. In June 2017 it hired its first VP of Diversity, Danielle Brown. Google CEO Sundar Pichai has emphasized that “A diverse mix of voices leads to better discussions, decisions, and outcomes for everyone.” Google’s Code of Conduct expects “each Googler to do their utmost to create a workplace culture that is free of harassment, intimidation, bias and unlawful discrimination.”
However, these efforts do not appear to be enough and the Company has been unable to make satisfactory improvements. As Google reports, the participation of Hispanic employees in its workforce rose one percent from the previous year to four percent. While black employees comprise five percent of non-tech positions, a one percent year over year increase, Black employees still represent just two percent of its total U.S. workforce, unchanged from 2015 and 2014. And, women represent 31 percent of Google’s global workforce, unchanged from a year ago and up just one percent since 2014.
This is clearly insufficient and Google agrees. As it states on its Diversity website, “When it comes to diversity at Google, there’s more work to be done.”
We believe that the Alphabet Board can provide greater leadership and guidance to management as it expands diversity and equality within the Company. We believe that the Alphabet Board should take further steps to demonstrate a clear and powerful resolve to address this challenge.
Resolved: Shareholders request the Board of Directors take steps to make the Board’s Executive Committee diverse in terms of race, ethnicity, and gender.
Currently Alphabet’s Board Executive Committee is comprised of Board Chair Eric Schmidt, CEO Larry Page, and President Sergey Brin. We believe that expanding diversity on the Board’s Executive Committee by adding a director or directors who are women or people of color can demonstrate the Board’s resolve and provide the necessary leadership and guidance for management.