Ellie Rutland | October 5th, 2017

Sigma Beta: Highest Recruiting Fraternity in California

Historically, the term “frat boy” has described young male members of social fraternities at universities. But today, the term has evolved into a badge of dishonor for men in male-dominated organizations that exclude or mistreat women.

In recent months, it has become apparent that this culture is widespread across Silicon Valley. Men who have made it to the proverbial “top” are so focused on growing fledgling companies that workplace regulations – even everyday decency – are often discarded. For companies with cultures of all kinds, communications plans are imperative to effectively address these kinds of incidents before they take on a life of their own. But more often than not, companies have shown that they are not prepared at all.

Take, for example, Uber. On February 19, Susan Fowler, a former Uber employee, published a blog revealing widespread sexual harassment and discrimination within the organization. The piece triggered an investigation that would lead to resignations, including former CEO Travis Kalanick, and firings across the company. Roughly 20 Uber employees were fired, including high-ranking members of the company™’s leadership team, over allegations of sexism and sexual harassment.

Uber has become the most famous corporate embodiment of the “frat boy” culture, but we are seeing increased reporting of similar incidents at other firms, too. Call it the domino effect – people feel compelled to come forward with stories of their own when they see others taking a stand and speaking out against discriminatory acts.

Ellen Pao sued her former employer – private equity firm Kleiner Perkins Caufield & Byers – over gender discrimination. And even though Pao™’s case failed, when her female coworker took the stand, she revealed an incident of unwanted sexual advances by the same partner named in the case.

More recently, on September 15, Social Finance (SoFi), a $4 billion lending tech start-up, announced that CEO Mike Cagney would be stepping down following wrongful termination and sexual harassment allegations. A month prior, Brandon Charles filed a lawsuit against SoFi alleging that he was fired after reporting sexual harassment. Cagney himself is accused of inappropriate behavior towards his executive assistant Laura Munoz. The New York Times reported on the September 12 that Nino Fanlo, former CFO at SoFi, had also engaged in inappropriate behavior towards women for years, commenting on their figures and even offering two women $5,000 each if they lost 30lbs.

Cagney™’s resignation follows those of 500 Startup™’s Dave McClure and Binary Capital™’s Justin Caldbeck, both of whom are accused of harassment and discrimination as well.

The plotline of what transpired at SoFi is horrifyingly similar to Uber™’s. Female employees were harassed, employees reported the instances with evidence to HR, and then HR buried it, often with consequences to the whistle-blowing employee. Then, as soon as the stories of harassment went public, numerous other employees came forth and offered their tales of woe as well.

More and more women across the Valley have begun to speak out about their experiences. Some are blatant forms of discrimination, such as being the focus of inappropriate conversations online and in-person, while others are more subtle, and thus harder to prove, like female employees alleging their ideas aren’t being heard in meetings, they aren’t being taken as seriously in the workplace, or even being stalled in the advancement of their career.

The Valley should take a very careful pause and evaluate what is going on within these organizations. Organizations have an opportunity to get a handle on this problem before it gets worse. And worse doesn’t just mean an obliterated reputation, it also means plunging stocks, significant time and money spent on lawsuits, and even diminishing applicant pools – like Uber experienced post-Kalanick when the company was turned down by top executives like Facebook™’s Sheryl Sandberg, YouTube™’s Susan Wojcicki, General Motors’ Mary Barra, EasyJet™’s Carolyn McCall, and Hewlett Packard™’s Meg Whitman to fill the role of CEO.

Offsetting similar corporate downfalls starts first and foremost with initiatives like improving or establishing strong corporate culture and communicating a deep and thorough commitment to that culture in all areas of the workplace. Companies should also perform voluntary internal investigations when needed and create a well-thought strategic response plan for addressing damaging allegations, if and when they arise.

Women make up 50% of the human race, and they should feel comfortable 100% of the time.

This post was co-authored by Brenna Means, a Fellow at LEVICK.