When I do an online search for “Ellen Pao,” MSN, Fortune, The New York Times, The Huffington Post, USA Today, Wired and many other media sources pop up with stories about her case. Most are now leading with the blow the jury delivered her, finding Kleiner Perkins Caulfield & Byers neither discriminated against her on the basis of her gender nor retaliated against her for speaking up about discrimination. Ellen Pao lost. For a period of time, media outlets and independent bloggers alike will discuss not only how this case will shake up the Silicon Valley, but also how it will help foster a dialogue about gender equality and discrimination in the workplace — where women still earn less than their male counterparts.
Consider this: Pao isn’t the only one who lost. The Kleiner Perkins name is found in the same sentence as “discrimination” and “retaliation.” Being called out as the potential poster child of gender discrimination in Silicon Valley is not a good place to be for companies who want to attract top talent and already have a very public problem when it comes to the number of women versus men in the workplace. Kleiner Perkins was fodder for discussion about the prevalence of sex in the workplace(not in the discrimination sense – in the extramarital affair sense). If you do an Internet search for “Kleiner Perkins,” the results page is plastered with news about Pao’s claims. Yes – Kleiner Perkins won a full defense verdict. That makes for great talking points for its corporate communications department, and it’s a big notch on the belt of their legal team. But at what cost to its corporate reputation?
As a former corporate lawyer, I can imagine the discussions the legal team had with Kleiner Perkins leaders. Kleiner Perkins was probably told they had a good case on the merits, but the media attention would be negative and very distracting to the business. It would cost hundreds of thousands (if not easily into 7 figures) to defend the case, and the question was whether Kleiner Perkins wanted to settle to avoid the unknown trial outcome and negative attention or take its chances based on the perceived strength of its case. Settling has its own downside. Paying off an employee who raises a complaint sends a message to other employees that maybe their employer messed up, and maybe there’s more money to go around. Very few employment cases actually go to trial, because it’s less expensive to settle, business leaders don’t want to spend their time in depositions and testifying at trial, and companies don’t want the corresponding brand or reputational harm.
I look at this and wonder whether Kleiner Perkins could have done something differently. I wonder whether Kleiner Perkins will do anything differently going forward so that they are never placed in this position again. Which company in Silicon Valley (or elsewhere) will be the first to stand up and say that it is learning from what happened here and taking a serious look at its employment practices, performance management systems and processes and its approach to recruitment, retention and promotion? This is a HUGE opportunity to be bold and to proactively and publicly demonstrate a commitment to diversity and inclusion that goes beyond mere words in a statement prepared by a corporate communications team. Three quick tips:
- If your company doesn’t have affinity groups, form them. Studies show that companies who have affinity or resource groups dedicated to bringing diverse opinions into the decision-making process perform better than companies who have no such groups.
- Engage with underrepresented individuals. You want to know whether your diverse talent would recommend your company to other diverse individuals. You probably want to engage an expert here to help with some anonymous dialogue with no fear of repercussion if you really want the truth.
- Act now. Don’t wait for the big lawsuit to prompt you into action. If there’s swirl or churn about feelings of underrepresentation at leadership levels or mistreatment in the workplace, it’s only a matter of time before a potentially brand/reputation-harming lawsuit.