Experts share how to fix energy industry’s diversity problem
- Several energy companies have responded to the death of George Floyd by circulating memos, publishing statements, and making donations.
- Those words are helpful, but they should be followed by meaningful action, experts say.
- A new organization called the Energy Diversity and Inclusion Council is launching on June 15. It seeks to be the premier D&I resource for the industry.
- Visit Business Insider’s homepage for more stories.
Energy companies were among the cadre of corporations that sent memos to their staff and published statements this week in the wake of George Floyd’s death last Monday.
“I find the events deeply upsetting, heartbreaking, and unacceptable,” Gretchen Watkins, president of Shell’s North American operations, said in an email to her employees reviewed by Business Insider.
Statements like these are helpful, said Dennis Kennedy, founder of the National Diversity Council, a nonprofit dedicated to fostering diversity and inclusion (D&I) in the workplace.
But the industry at large — long known for its limited representation of women and black Americans — still has a long way to go in its D&I efforts, he said. Some companies are further along than others, he added, but in general energy companies should focus on increasing community engagement and allocating more resources to D&I.
About 8% of the energy industry workforce is black, according to a recent report by the nonprofit Energy Futures Initiative, while women make up between 23% and 32%. And a 2017 report from the University of Massachusetts, Amherst found that black oil and gas workers earned 23% less than white workers in comparable roles.
There’s also an important history to consider: Pollution from the oil and gas industry has disproportionately impacted black Americans.
“The energy industry is really challenged around diversity and inclusion,” said Kennedy. “That’s unfortunate, but these organizations now have an opportunity to be inclusive.”
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Kennedy is working on a new effort that could help.
On June 15, he’s launching a new organization called the Energy Diversity and Inclusion Council, which will provide training sessions and other consulting services for energy companies, largely in the oil and gas sector, around D&I.
“We seek to be the premier resource for D&I for the energy sector,” he said.
Initially, the council will operate under the auspices of the National Diversity Council, he said, but once the board is in place, the organization will become an independent nonprofit.
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Business leaders are expected to respond
Protests swept the nation this week in the days after the death of George Floyd, a black man who died shortly after a white police officer, Derek Chauvin, knelt on his neck for almost nine minutes as he gasped for air. The officer now faces charges for murder in the second degree.
Floyd’s death has fueled the global movement for racial justice. And corporate leaders won’t do well by sitting on the sidelines, said Lanaya Irvin, president of the Center for Talent Innovation, a nonprofit that helps workplaces become more inclusive.
“There’s an expectation for business leaders to be visible, vocal, and willing to use their access and power to renounce racism and injustice,” she said. “There is a risk to saying nothing because the world is watching.”
Silence is seen by some as apathy, no matter what sector they represent or where they’re based, Irvin said.
“You’re facing a country that’s experiencing collective unrest, so it’s really difficult to uphold the assertion that the outside world is not relevant,” she said.
Energy companies share memos to staff
This idea doesn’t elude the largest energy corporations, many of which responded to Floyd’s death this week.
Shell, Chevron, Exxon, Duke Energy, and Dominion Energy all responded to Business Insider’s request for comment with some kind of statement or memo, while bp’s chief shared what he wrote to his staff on LinkedIn.
Of the six responses, four mentioned George Floyd by name and two mentioned Breonna Taylor or Ahmaud Arbery. Taylor, a black woman, was killed by police officers who entered her apartment, and Arbery, a black man, was shot by two white men while he was out for a jog.
“We can’t predict how this journey will unfold, but we all know how it must end: with all Americans confident in the belief that they will be treated as full and equal partners in our society,” Lynn Good, CEO of Duke Energy, said in an email to the company.
In response to a request for comment, NextEra Energy said it doesn’t share its internal communications and did not return a follow-up request for a statement on the protests. ConocoPhillips did not respond to a request for comment.
Speaking from his home base in Houston after marching himself earlier this week, Kennedy said words are important, and he commends the companies that have responded. But he’s quick to add that “it’s not what organizations say, it’s what organizations do” that matters.
“What are they doing?” he said. “My hope is that from their responses there will be action.”
Bridging the gap
The oil and gas extraction industry employs a lesser proportion of black people than most other industries, according to data from the Bureau of Labor Statistics reviewed by Business Insider. It also employs a small share of women, as we previously reported.
Kennedy isn’t sure exactly why the industry has struggled with diversity for decades, but he and Irvin have some ideas for how to fix it that go beyond public statements.
It starts with community engagement, they said.
“There’s no formula or roadmap, but there does need to be authentic engagement with your employee base, with clients and stakeholders,” Irvin said. “The companies who get it right will be those who are willing to lean in, be visible, be vocal, and admit when there are opportunities for growth.”
Companies should also consider bringing on board members of color and allocating substantial resources to D&I initiatives, Kennedy said. Many of them have, he added, such US oil giants Chevron and Occidental Petroleum and the power company NRG Energy.
“I tip my hat off to those individuals that are championing D&I internally because it’s an uphill climb for a lot of organizations,” he said.
A new organization focused on D&I in the energy industry
Kennedy has dedicated the last 15 or so years of his life towards making the business world more inclusive and diverse, he said, first by starting a diversity council for Texas and then taking it national.
Now, he has his eyes focused on The Energy Diversity and Inclusion Council. It will bring together top companies to share ideas and offer training and other consulting services.
The organization, which will be based in Houston and initially housed within the National Diversity Council, will launch on June 15, Kennedy said. At that time, he’ll be reaching out to the top energy companies, most of which focus on oil and gas, and asking them to join the board.
“We have an opportunity today,” he said. “My hope and my prayers are that they’ll address these issues.”