At Work

No job-hiring process will end unless minority candidate is interviewed: VMware CEO Pat Gelsinger

Key Points
  • VMware CEO Pat Gelsinger said at a CNBC @Work virtual event on Thursday that for any open position at the technology company, the hiring process will have to include consideration of both a woman and a minority candidate.
  • Technology companies have been vocal about diversity efforts, but historically, much of the focus has been spurred by investor and government scrutiny.
  • A focus on gender diversity in the corporate sector has in recent years gained more traction than efforts to increase racial diversity.
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VMware CEO Pat Gelsinger is making one move within his company to reflect its own need to create a more diverse workplace. Speaking at a CNBC @Work virtual Spotlight on Thursday, Gelsinger said the $63 billion software company has updated its diversity policy in hiring as a result of recent events.

Previously, the company had in place a rule that no hiring process could be complete unless a woman or person of color was interviewed. Now the company will require hiring managers to consider at least one candidate from both backgrounds.

"Now we're saying every position has to consider gender and race," Gelsinger said.

He said this policy update does not ensure a diverse candidate will be the one chosen for the job. Gelsinger also indicated race should be a factor in internship program decisions, saying companies need to bring in a lot more candidates from Black and underrepresented communities and make that a "much more conscious focus of intern programs."

Elaborating on Gelsinger's comments made at the CNBC virtual event, a VMware spokesman told CNBC via email that prior to the recent events, the company required that a woman or an underrepresented minority be included as part of the interview slate. "And we're moving towards a woman AND an underrepresented minority as part of each hiring campaign," he said.

We've focused lots more on gender than race, and now we need to put emphasis on those areas together.
Pat Gelsinger
CEO of VMWare

VMware discloses a diversity report annually. In fiscal year 2020, all vice presidents and above were assigned a D&I (diversity & inclusion) goal to improve the representation of women globally and improve representation of U.S. underrepresented minorities.

In its most recent annual diversity report, VMware disclosed that 3.2% of its workforce was Black, up from 3% the previous year and 2.7% in 2018. However, Black representation within the company is low compared to other ethnic groups and gender representation. Women comprise over 25% of the company's workers. By race/ethnicity, White workers comprise 57% of the company; Asian workers over 31% and Hispanic workers nearly double African American peers, at 5.8% of VMware's workers. 

Currently, 1.5% of leadership roles at the company are held by Black employees; a little under 4% by Hispanic workers; 26% by Asian workers; 67% by White employees.

"We've focused lots more on gender than race, and now we need to put emphasis on those areas together," Gelsinger said at the CNBC event. 

The percentage of White workers among all employees and in leadership positions at VMware has increased more in recent years than Black employee representation, according to its most recent diversity report.

VMware is far from alone in having work to do on Black representation in its workforce and in making a focus on racial diversity as high-profile as gender efforts, according to Mercer's Gail Greenfield, a principal in the consulting firm's Washington, D.C., office who specializes in pay equity. Greenfield said her work with corporate clients over the years indicates that gender has been more of a focus than race, but that is changing quickly.

"I'm getting far more inquiries than I ever have about this topic," Greenfield said. "They are definitely focusing on diversity broadly, but specifically mentioning racial diversity and Black employees and racism. It's definitely coming up in requests from clients that I didn't see a month ago."

Silicon Valley's corporate culture is far from diverse, whether it is evaluated by venture capital funding or employee base at big tech companies.

Similar to VMware's small gains in hiring Black candidates, Facebook, for example, has gone from a workforce that's 3% Black to 3.8% in the past six years. Others also are in the low single digits.

Greenfield said the technology sector has had a focus on diversity over the past decade, but she described that focus as often reactive rather than proactive. Government contractors with 50 employees or more are required to provide demographic information on their workforce, and social investors have pressured them as well. 

"Now I think it has evolved to the point where more companies are doing it not because it is requested or coerced but because they want to use it as a way to commit to diversity and inclusion," Greenfield said.

For more on tech, transformation and the future of work, join the most influential voices disrupting the next decade of work at the next CNBC @Work Summit this October.