Pinterest Discrimination of Employees (June 2020)
Company Background
Pinterest is a social media company that started in 2010 with CEO Ben Silbermann and “With Instagram off the market following a 1 Billion dollar sale to Facebook, Pinterest is not the hot social media startup in Silicon Valley” (Founder). So, from the start, the company had lots of different eyes on it which made growth fairly easy “going from 5,000 users in August 2010 to 17 billion in 2012” (Founder). Silbermann got his start by working at Googleplex where he grew to a point where he didn't enjoy his job anymore and then his girlfriend encouraged him to quit. After he quit his job he started an “App development company, Cold Brew Labs” (History).
From this company, he and his high school friend developed an app called Tote. With Tote “Users could browse apparel and other goods from 30 retailers, save items as favorites, and receive push notifications when those items reduced in price” (History). This app sounds similar to what Pinterest developed into but it never got the traction due to people not really catching up with the transition to online shopping. But with the data of Tote Silbermann noticed a trend “ Users were browsing for products and saving them using Tote’s saving feature” (History). Using the data helped the development of Pinterest they took some of the base data from Tote and expanded on the save features and allowing people to search for things they want and be able to add them to a board to look at later. After years of trial and error with betas and testing, they finally launched their app to the public. “Most companies experience periods of intense growth … for Pinterest that was 2011”(History). This due to it being available on the Apple app store and helped them net more users than they thought possible. In 2012 it was time for a big round of funding so they had “raised 100 million dollars as a part of its Series C” (History) that gave them a net worth at the times that were higher than recently acquired Instagram. Until the recent turmoil, it seemed like Pinterest was bound for nothing but success.
Case
Banks has stated that she has reported these events to HR several times but they deemed that “Hale did not act inappropriately” (discrimination) which is kind of shocking due to the fact of him making multiple racist remarks. Banks kept finding herself doing stuff that was outside of her pay grade so she asked for promotion guidance in which “ It took weeks for him to respond and when he did he mentioned needing a certain number of years tenure to get a bigger title” (discrimination). Banks was unaware of this since she was just told to kill it and she would receive a raise and her ranks would increase no matter how long she was with the company. One of the biggest things Banks said she had to overcome was the retaliation every time she would write something up and send it in it was met with a different opinion.
Banks had crafted a policy to allow them holiday pay to all employees. According to the company “ they were going to adopt that policy but later Banks learned that the proposal; had embarrassed an upper manager” (Discrimination). After this Banks said she had fired all the consultants due to the fact of them misleading the senior executive about involvement in the policy. It was all downhill from that point “Banks was stripped of her responsibilities” (Discrimination) and all the promotions that were in talks were gone and her career was put at a standstill. She was so depressed that her doctor prescribed her antidepressants which she had never taken before in her life.
Moving on to Ozoma’s side of the story her troubling experience began nearly one year into her time with Pinterest. “One of the long-standing issues with the tech industry is the seniority level that women and minorities tend to be assigned… Men are more likely to begin a job in a higher position with larger pay than women are and that's one of the many reasons they are paid up to 20% more” (Discrimination). She was given many high reviews by employees and people of higher ranks so she asked for a pay raise which she received but still not satisfied she wanted to be credited with a higher rank and she was denied. She ended up hiring a lawyer to get her rank increased in which she did which came with another pay raise.
Later Ozoma’s personal documents were leaked by another employee; it had “linked her name to a far-right political group and shared personal information… she received death and rape threats and random people showed up at her house” (Discrimination). In ordered to get it straightened out Pinterest overfeed to send security to her house which she thought was “absolutely ridiculous” she wanted all of the information wiped off the web but Pinterest wouldn't do that so she had to call former employees at Facebook and Google to aid her in this process while also working with a news intelligence agency. Both Ozoma and Banks ended up quitting in May of 2020 and filed separate DFEh complaints but when they saw the company speak up about the Black Lives matter they decided it was time to put their story out to the public.
The future of most companies relies on their stakeholders and the people who invest in the company. These people help fund big projects companies might be working on and allow them to stay in business. Pinterest had just gone public approximately a year before this whole situation happened; they were valued at around 10 billion dollars and they were to be sold at around 15 to 17 dollars a share. “ Pinterest will use a dual-class structure to concentrate on voting power among major stakeholders including co-founders Ben Silbermann and Evan Sharp. These stakeholders will own class B shares and the rest class A shares” (stakeholder). This system will better help the decision-making system and give the major stakeholders more power to make decisions.
Stakeholders
Some of the major players in the Pinterest stake start with “Andreessen Horowitz who owns approximately 43,500,000 shares which is 9.6% valued at 696,621,296.00 dollars. The next major player would be the company's CEO Ben Silbermann who owns 51,600,000 shares which equates to 11.4% and is valued at 826,107,456.00 dollars. The biggest stakeholder in the company is the Bessemer Venture Partners who own about 59,500,000 which is 12.1% and is valued at over 951,330,000.00 dollars” (Stakeholder). There are several other class B stockholders but those are the 3 most important with the most to gain and lose due to the treatment of minorities at Pinterest.
One of the four major ethical topics that I will discuss is Utilitarianism. A utilitarian has a very different outlook on ethical theories than the other three. So concerning this Pinterest case, a utilitarian would view this case as unethical. “Business actions should aim to maximize the happiness in the long run for all conscious beings that are affected by the business action” (Heather). With Pinterest not treating each employee equally in terms of pay and position and some employees making racist remarks, it doesn't fit the outlook of maximizing everyone's happiness.
When looking at the case I'm not sure how much of this gets up to the higher-ups and the CEO but Utilitarianism is considered “an excellent theory that takes a stakeholder approach” (Heather 19). So this approach would mean they care very much for the people that are invested in the company but after news like this getting out into the public, it hurts everyone involved so it is more of a reason for this to not line up with the utilitarian approach.
Utilitarianism
The utilitarian approach also states that “ utilitarians are concerned about long term costs and benefits of actions. This systematic and long-range perspective can help the business avoid short-sided thinking that often boots profits momentarily but leads to a quick demise” (Heather 20). If this case were to get some major publicity in the news it could be a long road ahead for the future of Pinterest especially nowadays with the social injustice that the world is facing. I think as a company they knew this was a possibility so they reacted as quickly as they possibly could and put out articles saying that they were hiring more minorities in the company and making sure stuff like this doesn't happen again.
The next major point of Utilitarianism is “Business should aim to maximize happiness in the long run for all conscious beings” (Heather 17). In this case, the way the two employees get treated I'm sure doesn't make them feel good or happy in any way. Which in result causes them to have some sort of resentment towards Pinterest which leads them to speak out and parting ways from the company.
The last major point of Utilitarianism is “Pleasure with the absence of pain” (Heather 17). This is very important to the case because a utilitarian would want employees to enjoy their job and not have to worry about being profiled and singled out but that is the way Pinterest is making them feel.
Kantism
The next major ethical topic that I will relate to the case is Kantism. Kantism is the complete opposite of Utilitarianism “Kantism does not make decisions based on consequences” (Heather 21). So when Hale was making those racist remarks at the dinner a Kant wouldn’t be looking at the remarks he was looking at the person who made the remarks and determining if that person had goodwill or not. I'm sure when Hale made those jokes he was aware of his intentions and had no goodwill intended towards anyone thus not following a Kantian point of view.
The next major point in Kantism is the formulation of humanity which states “that it is wrong to use people as a mere means to get what you want” (Heather 22). I think in this case the employees are simply being used by the company they are being required to do more work than what their rank and pay require them to do while also being treated very unfairly by their co-workers and the higher up.
The last major point of Kantism is “rational decision making… don't lie, cheat or manipulate or harm others to get your way” (Heather 17). In this case, there really is no rational decision making going on. It's more so just do this and accept it and employees are doing a lot of extra work. In the case, it also states that Banks was forced to take antidepressants and that is harming someone to get your way. If the company is getting her to a point where she has to start taking medication to help the way she feels that in no way supports the Kantian theory.
Individualism
The third major ethical theory is Individualism. This one an individualist would view this case as ethical due to the fact of them supporting business. One of the major points of individualism is “Business actions should maximize profits for the owners of the business but do so within the law” (Heather 17). A lot of the stuff that they are doing isn't necessarily correct but they are making their employees work and help grow the business while not breaking any laws. Some might have to do some extra work and you might not get a pay increase but by no means is it illegal.
Another major individualist theory is “The rules of the market and supply and demands economically regulate how much employees should make and what benefits the company needs to offer” (Heather 18). In the case, it didn't talk much about what kind of benefits were being offered by Pinterest but the pay must have been comparable to what Banks and Ozoma were making at their other tech company jobs. I'm sure if the salary for the position moved in one direction they might get a raise in pay since they would lose employees because everyone wants to make more money.
The last major point to bring up for individualism is “individualism is the only theory among the four that is specific to the business context” (Heather 18). That is the reason why this theory supports the case so much because the case is more about furthering the business no matter who gets affected by what happens. As a business that's all you really care about you want to keep employees happy but the most important thing is making money for your business.
Virtue Theory
The last ethical theory to cover is the virtue theory one of the major points id “act so as to embody a variety of virtuous or good character traits and so as to avoid bad character traits” (Heather 17). Pinterest's way of handling the company's racial issues showed poor character traits as a company they didn't really do much until after the story broke.
This theory differs from the other three because it deals with “ a person's character while the others deal with people's actions” (Heather 22). The actions that were taken by each of the two employees is very courageous and definitely falls in line with what Virtue theory believes in. For them to stand up for what they believe in is very powerful they could have risked getting fired from the company and ruining their reputation which would hurt them in getting a future job.
Justified Evaluation
The whole case in my opinion is very unethical and should not have happened in a business today. Today's society has broken out with an outcry of several forms of racial injustice and many public figures have spoken up about how we as people need to be better and treat people equally. Some of the biggest names appear in sports leagues, Influencers on social media, actors, and in numerous other professions. When it began happening the first time Banks should have been more vocal about it and they should have taken it as a learning curve and know that they need to do better for their employees. But when they began to compound it and more people with the company began speaking up that's where I feel that it really breaks the line of being unethical. Whenever something like this happens within a company it should come to the top of the list on how it needs to be changed because when it breaks it hugely affects the company and if you don't have a good foundation it could cause companies to go under.
One of their major positives that had come out of this situation was the fact that Pinterest did learn about employees being treated unfairly. If they chose to use this information to make the company a better environment is up to them but from the sounds of it appears that the CEO has started making progressive steps towards bettering the company for the future. With that being said Pinterest is still a new social media company in comparison and has a lot of learning to do but this instance will help them make better choices going forward.
Pinterest is a very big social media platform but it does not make the news very often with negative publicity. Although this treatment of workers was definitely unfair it is still one of the first major hiccups that they had to deal with. Some points of action that I think they will have to take moving forward are just better treatment of employees. According to their website, the motto is “to bring everyone the inspiration to create a life they love” (Pinterest). To do this they need to straighten up the workplace and they need to provide stakeholders with their appropriate compensation. When this is the motto that you display on the pages of your website it needs to be something that you live by because if you don't it's kind of hypocritical. I’d find it hard to believe that all the higher-ups in the company were totally unaware of what was happening behind closed doors. It was essentially their job to know that kind of stuff.
Action Plan
The things that they need to do to resolve this problem start with bringing in new diverse employees. They need to give different power positions to a diverse group of individuals so if someone has a problem with the pay they can take it to a boss then it gets discussed by a group of individuals with very different backgrounds. The next step they need to take is to provide a clear outline of things to do when you get hired in the company to move up and get higher pay. The method of just working harder never works. They need to have it written out and it needs to be understood by prospective employees looking for a job. The third step that needs to be taken is they need more a relationship between workers and bosses and bosses to the higher-ups. The chain of communication needs to be more fluent because if someone has a problem it should be easily communicated throughout the company and it needs to be dealt with as soon as possible.
My improved mission statement for Pinterest would be “Creating an equal opportunity for everyone”. This is a good statement for them to follow because it shows that they care about all of their employees and they want them to be treated equally and have the same type of job promotions as everyone else in the company. It is a huge improvement because their motto just talks about people making a life they love but with mine, it shows that they are a diverse company and they are willing to bring in people of different ethnic groups to work for them.
A new set of core values for Pinterest in my opinion would start with equality. They need people to know that they are changing as a company. The next value to incorporate would be fairness. It shows that no matter where you start or what position you work in you are going to be treated the same as someone in a higher position and a lower position. The last core value that I would integrate into the company would be creativity. When you work at a company such as this one creativity is a big thing so people need to come in knowing they have the creative freedom to try new things and present new ideas to the board regardless of how out of pocket they might be.
To maintain an ethical type of productivity they should start by having company meetings once or twice a week to make sure everyone is on the same page. In the meeting, you can bring up anything that relates to the workplace. It can relate to how you feel you've been overworked or you feel someone isn't doing their share. They should also set aside time for maybe a personal meeting once a month with employees to discuss more personal matters such as time off bonus or pay. When you bring in new employees and fire them make sure it's a group decision don't just fire someone because you don't like them or their views don't align with yours.
Different kinds of marketing the company can do are showing their support for different ethnic groups by donating money by just having members show their support in person or on social media. Make ads that relate to what they are trying to change within the company to show people that hey they may have done this but this is what they are doing to better themselves. This plan going forward could be very important to help Pinterest move forward and get past the bump that they faced with the injustice. It could also expand their outreach of individuals because people are very supportive of a company that also supports what they believe in.
Conclusion
In conclusion, several companies go through different kinds of turmoil when you are looked at so highly in the public eye especially social media companies because those are the ones that are closely monitored. They need to start bringing in new ideas with new employees to help improve their public eye and get them back on track. As of right now, their stock price is at a five-year high so the improvements that have been made have been good for the business. I’m not so sure this will be Pinterest's last time in the news over something controversial because that is what happens in almost all companies but I don't think it will ruin the company due to this one having a very small impact on it. I just hope going forward in business they are more careful with the decisions that they try to make and weigh the pros and the cons and are positive that that's the route they want to take.
-Dustin Kuhner
Works Cited
Bort, Julie. “The Two Black Employees Who Took on Pinterest Explain Why They Quit, Their Fight for Pay, the Death Threats, the Private Investigator: 'It Was a Torturous Experience'.” Business Insider, Business Insider, 24 June 2020, www.businessinsider.com/two-black-former-pinterest-employees-discuss-their-fight-for-pay-2020-6.
Carlson, Nicholas. “Pinterest CEO: Here's How We Became The Web's Next Big Thing [DECK].” Business Insider, Business Insider, 24 Apr. 2012, www.businessinsider.com/pinterest-founding-story-2012-4.
Feiner, Lauren. “Here's Who Will Get Rich from Pinterest's IPO.” CNBC, CNBC, 8 Apr. 2019, www.cnbc.com/2019/04/08/pinterest-ipo-the-largest-shareholders.html.
“How Pinterest Became an $11 Billion Company by Organizing the World's Hobbies.” Product Habits, 17 Sept. 2018, producthabits.com/how-pinterest-became-an-11-billion-company-by-organizing-the-worlds-hobbies/.
Madrigal, Alexis C. “Think Pinterest Is Stupid? This Interview Might Change Your Mind.” The Atlantic, Atlantic Media Company, 31 July 2014, www.theatlantic.com/technology/archive/2014/07/what-is-pinterest-a-database-of-intentions/375365/
- Myrow, Rachael. “Pinterest Sounds A More Contrite Tone After Black Former Employees Speak Out.” NPR, NPR, 23 June 2020, www.npr.org/2020/06/23/881624553/pinterest-sounds-a-more-contrite-tone-after-black-former-employees-speak-out.
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