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Amazon's Board Hiring Policy: Appropriate or Short-Sighted?

In an article for Harvard Business Review, Stefanie K. Johnson discusses a recent decision by Amazon to not update its board hiring processes for board of director positions to formally require the consideration of women and minority candidates. What would prompt such a move? Johnson makes two interesting points, backed up by research from herself and colleagues on diversity hiring.

One Is Not Enough

Johnson compares the rejected shareholder proposal to the so-called “Rooney Rule” in the NFL, a policy implemented in 2003 that required every team to interview at least one minority for open head coach or general manager positions.

Johnson points to data showing that while the Rooney Rule had some positive impacts, such as raising diversity and inclusion to greater awareness within the league, interviewing a single woman or person of color is often not effective in getting those groups represented when the hiring decision is actually made.

That’s because the token minority or female candidate sticks out so prominently among the list of candidates. They are perceived primarily based for their race or sex, because they are the only one. On the other hand, the likelihood of a minority or woman being hired increases significantly if there are at least two within the pool of applicants.

Playing to Win Versus Playing Not to Lose

Johnson also notes that fear of change often leads to aversion to policies like the one recently rejected by Amazon. “My research found that CEOs who did push for diversity on their boards were very focused on the benefits it would bring, while CEOs who did not tended to focus on the things they would lose (like the current group dynamic) or the risks they would encounter (like that people might think the candidate is a token hire),” she writes.

Johnson points to a theory by psychologists that distinguishes these two perspectives as follows, and writes: “A focus on playing to win (what’s called a promotion focus) can result in growth and improvement in business outcomes, but a focus on trying to avoid losing (prevention focus) tends to result in stagnation.”

Amazon’s decision against updating its hiring policies to require the consideration of women and minority candidates created a great deal of backlash, both internally and externally. It’s worth noting though, as a parting thought, that of Amazon’s current 10-person board of directors, all are white and seven are men.

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