Helping Companies Be Accountable

What should an organization do when it’s not measuring up on diversity, equity, and inclusion (DEI)? Companies face increased pressure around transparency and accountability in operationalizing their DEI commitments—not just posting on social media or making donations, but also engaging in the long-term, sometimes painful work of applying DEI to all aspects of business.

That’s where Stephanie Lampkin, MBA ’13, comes in. In 2015, she founded Blendoor, a diversity analytics firm that helps companies improve DEI. Most don’t even know where to begin. “The analogy I give is that when we first started Blendoor, it felt like we were selling scuba diving equipment to people who didn’t know how to swim,” she says. “We’ve had to take a step back and really figure out how to give the fundamentals.”

Blendoor recently conducted a “State of DEI in Tech 2021” survey using diversity reports, proxy statements, and organizations’ websites. They found that 240 major tech companies lagged behind their Black Lives Matter pledges. There were significant drop-offs for men and women from underrepresented groups moving into leadership positions. Only 15 percent of named executives were women, who on average were paid 21 percent less than their male counterparts; none of these women were Black.

While the results aren’t promising, Lampkin’s goal is not to shame companies but to work with them. Blendoor identifies an organization’s public-facing BlendScore—like a FICO score, but for DEI. Using private and public data, the BlendScore measures how a company is faring relative to its peers. Then, Lampkin’s team offers targeted recommendations.

“All of these companies made Black Lives Matter statements, but some of them aren’t even measuring the percentage of Black employees in their company. So, how could you care about something you aren’t tracking?” she asks.

“We don’t really care if your numbers are bad. Most companies’ numbers are bad. We have a lot of social constructs in this country that we’re reckoning with that explain why those numbers are bad. Institutions are not going to solve inequity overnight. But the fact that most public companies aren’t even measuring their diversity speaks volumes. So, at a minimum, public companies should measure and publicly disclose their diversity statistics, because public disclosure at this stage will be the most significant signal that this is something a company cares about.”

In August 2021, the SEC approved new rules about public disclosures around DEI, which means that diversity is now a fiduciary responsibility. Blendoor vocally supports the legislation, and they’ve opened an office in Washington, D.C. Soon, Lampkin hopes that an organization’s corporate social responsibility officer will be as important as a CFO and that Blendoor will become the de facto standard for DEI ratings and governance, potentially as part of an investment tool like Morningstar.

“It’s governance, risk management, and compliance kind of like Sarbanes-Oxley,” she explains. “Staying up to date, de-risking, and ensuring that you aren’t putting your company in a particularly bad position for an adverse event related to pay inequity, sexual harassment, or discrimination.”