A look at how the toxic culture and pattern of gender discrimination at Nike is threatening the company’s reputation and bottom line.

Ignore a toxic culture for too long and it will come back to bite you. That’s the clear message coming out after the recent shake-up at Nike. As The New York Times reported, an entrenched culture of sexism that led to women consistently being harassed, overlooked for promotion, and excluded from certain divisions, has been toppled. A female-led revolt has also seen a number of male executives being brought down along the way.

Crucially, complaints made to HR were said to have produced little or no action. As a result, a group of women at the Nike headquarters in Beaverton, Oregon, took matters into their own hands.

After three top female executives left the company, the remaining women decided to collect their own data about the levels of harassment and discrimination they were experiencing. They created a survey sent out to around 50 past and present female colleagues about their experiences in the workplace. The results were presented to Nike’s CEO Mark Parker on 5 March and, following an internal investigation, six high-ranking executives either handed in their resignation, or indicated that they planned to leave – including the head of diversity and inclusion.

A HR failure

In the wake of the high-profile resignations, Nike is said to be reviewing HR policies and procedures, including an audit of reporting practices and management training. Around the time the survey began circulating, the former head of HR David Ayre was fired, allegedly for “condescending behaviour”. His replacement, Monique Matheson unveiled plans to increase the number of women and people of colour in leadership roles through the creation of a diversity sourcing team and “unconscious bias training” for hiring managers.

But is it too little, too late? Some of the questionable HR practices used by the company include an employee being told to publicly discuss – in a cafe frequented by fellow employees on the Nike campus – an incident of her supervisor trying to kiss her. Employees were also reportedly fired by PowerPoint, in a presentation style, in front of others. Another female employee reported to human resources that her male manager called her a “stupid bitch” and threw his car keys at her, after which he remained her boss. It is difficult to fathom why these complaints were overlooked at a globally renowned brand, and it’s troubling that these discriminatory practices appeared to be the norm.

A costly diversity mistake

The lack of diversity at Nike appears to have been negatively impacting the company’s bottom line for a while. In an organisation where half of the employees are women, yet only 38 per cent of directors and 29 per cent of VPs are female, they seem to have failed to understand the impact on their consumer base.

Of Nike’s $34.4 billion generated in revenue last year, only a fifth of that business came from sales of Nike womenswear. Given that female activewear is a $45.9 billion dollar trend and growing, this seems like a huge missed opportunity for the brand. Perhaps it’s evidence that gender discrimination and lack of diversity really doesn’t pay.