After last year’s reckoning on racial injustice across America prompted a look into widespread inequity within the food and beverage industry, companies appear to be making progress on their diversity, equality and inclusion (DEI) goals, according to a new study by Deloitte Insights and FMI – The Food Industry Association last month. However, despite taking steps towards better racial and gender representation within corporate leadership, the majority of the industry still faces a long path towards reflecting the broader U.S. population.
The survey, which was conducted in April and May as part of a series of reports on the “Future of Work” in the food industry, included over 150 U.S.-based executives at CPG brands, food manufacturers, processing companies and retailers. The report also drew from in-depth interviews with 15 “industry leaders” to “interpret survey findings” and provide additional insights.
According to the report, 68% of respondents said since last year they had added new programs to educate employees on inclusion and inequality, topping the list of general workplace and operational changes companies have made since the onset of the pandemic.
“The people around us are important contributors to how welcoming, comfortable, and valued we feel, so various types of diversity and inclusion training for the workforce at large can increase attractiveness and retention,” the report stated, noting that the training can help create a more welcoming environment for new hires. However, while training may be “a great start,” the report also argued that “it should be combined effectively with a more equitable talent process” that uses metrics to track progress in diversifying the workplace and hold employees accountable for misconduct.
According to FMI, 67% of food companies have introduced quantifiable DEI goals and timelines and 86% of respondents said they were actively working to increase diversity among senior leadership. About two-thirds of executives said they believe the industry is making progress on these initiatives and 70% said they have already been successful in creating “a better workplace for their employees.”
The emphasis on diversity has been seen in recent months across the food and beverage sector through a range of initiatives, from hiring objectives to new programs aimed at uplifting minority-owned companies. Last month, PepsiCo announced Juntos Crecemos (Together We Grow), a $50 million platform that will support Hispanic-owned small businesses including restaurants, bodegas and meat markets. The program includes a course to train entrepreneurs on improving their online presence, delivery logistics, online ordering and marketing, as well as providing store essentials and targeted digital media support.
In June, Keurig Dr Pepper (KDP) announced that it would aim to increase the number of women and people of color in director level and higher positions by 25% by 2025. However, some announced initiatives have proved controversial; this summer shareholders threatened legal action against The Coca-Cola Company’s board of directors after former Coke general counsel Bradley Gayton vowed to only employ outside law firms who agreed to have at least 30% of billed work be done by diverse attorneys. In an open letter, the group alleged the policy violated the Civil Rights Act and the Americans with Disabilities Act.
Despite lofty ambitions, the food industry also lags behind other sectors in growing representation among management, particularly when it comes to top level leadership. An analysis of Fortune 500 board of directors by Deloitte and FMI found just 35% of board seats were held by women or historically marginalized groups, up just 4% between 2018 and 2020. However, non-food consumer staples companies had achieved 47% diversity, up 11% in the same period.
C-suites showed a similar lack of diversity; however, 58% of food retailers and 65% of supplier executives said they were aware their company’s senior leadership “is still not representative of the greater population, while 27% of retailers and 30% of suppliers believed they were sufficiently represented.
Despite some progress in 2020, the report argued companies must be loud and clear in their commitment to DEI initiatives while working to cultivate a diverse talent pool down the ladder.
“Vague commitments to make improvements aren’t as clear as pledging that your workforce will reflect the diversity of the population and the customers you serve with milestones on a timeline,” the report stated. “Implementing management incentives is also a critical factor for making progress. At the end of the day, potential employees, and consumers for that matter, are smart. They know which companies are merely talking and which [are] getting results.”