Addressing racial injustice

An email from CEO Satya Nadella to Microsoft employees: 

As I shared in our Employee Town Hall last month, and in my email earlier this month, we are committed to take action to help address racial injustice and inequity, and unequivocally believe that Black lives matter. Below you will see many of the steps we are taking.

Over the past several weeks, the senior leadership team, board of directors, and I have spent time reflecting, listening, learning, and discussing what role the company – and all of us collectively – must play in helping to drive change, both within Microsoft and in our communities. With significant input from employees and leaders who are members of the Black and African American community, we have developed a set of actions that we believe are both meaningful to improving the lived experience at Microsoft, as well as driving change in the communities in which we live and work.

Today, we are making commitments to address racial injustice and inequity for the Black and African American community in the United States. We will additionally take important steps to address the needs of other communities, including the Hispanic and Latinx community, across the company in the next five years. We are focused on three multiyear, sustained efforts:

• Increasing our representation and culture of inclusion. We will build on our diversity and inclusion (D&I) momentum from the past five years by adding an additional $150M of D&I investment, and will double the number of Black and African American people managers, senior individual contributors, and senior leaders in the United States by 2025.
• Engaging our ecosystem. We will use our balance sheet and engagement with suppliers and partners to extend the vision for societal change throughout our ecosystem, creating new opportunities for them and the communities they serve.
• Strengthening our communities. We will use the power of data, technology, and partnership to help improve the lives of Black and African American citizens across our country, including to address the safety and well-being of our own employees in the communities in which they live.

Below are key details on how we will accomplish this.

Our Culture

We need to ensure that our culture of inclusion is a top priority for everyone. It starts with our values of respect, integrity, and accountability. Each of us must be able to thrive in diverse teams. Every manager must be able to attract, retain, and grow employees of all backgrounds. This is certainly true at Microsoft, and also more broadly. It is the new baseline for manager excellence across industries across the globe.

We will meet this new goal in three key ways:

1. We will accelerate our cultural transformation through further investment in inclusion. Managers who have a deep understanding and commitment to building inclusive culture are key to our company’s success. Starting in FY21, our training on allyship, covering, and privilege in the workplace will be required for all employees, with additional new content on understanding the experience of the Black and African American community. Because leadership sets the tone, we will have required live sessions for CVPs and EVPs to ensure they better understand the lived experience of these specific communities.

2. We will strengthen our intentional career planning and talent development efforts. This will apply across our workforce, beginning with Black and African American employees. These programs will expand to include other employee groups as we learn and grow. We will expand on our leadership development programs for select Black and African American midlevel employees and their managers, to help prepare for promotion to Director/Principal. For Director/Principal level, we will create a new development opportunity to expose them to the leadership expectations of the Partner/GM level and match them with senior-level sponsors and mentors. For Partner/GMs, we are continuing to invest in the dedicated leadership development programs.

3. We will further strengthen company accountability for progress on representation. We will deepen our practice of evaluating each CVP/GM’s progress on diversity and inclusion when determining their impact and rewards, as well as promotion considerations. We will provide CVPs with dedicated D&I coaches to confront and resolve systemic obstacles within their organizations. We will expand our global, quarterly promotion process to ensure we build diverse leadership teams at all levels. This will include direct engagement with business leaders on review of all candidates for people management, Director/Principal level, and Partner/GM level.

Our Ecosystem

A vast business ecosystem surrounds Microsoft from our supply chain to our partner community. We recognize that a stronger and more productive ecosystem requires better representation of the diversity in our communities. We will evolve our engagement with our supply chain, banking partners, and the broad Microsoft partner ecosystem in this effort.

1. We will double the number of Black- and African American-owned approved suppliers over the next three years and spend an incremental $500M with those existing and new suppliers. We’ll do this by ensuring our existing guidance to include diverse minority-owned suppliers in all RFPs is well understood, evaluate supplier portfolio composition, and enhance the weighting of diversity characteristics (both in ownership and in broad workforce) during the supplier evaluation and selection process. We will also encourage Black and African American representation progress in our top 100 suppliers, which account for over 50 percent of our indirect spend, by requesting annual disclosure of their diversity profile information (e.g., workforce diversity, goals) that we will incorporate into our RFP evaluations.

2. We will use our own banking needs to grow our portfolio investment activity with Black- and African American-owned financial institutions. Over the next three years, we will double the percentage of our transaction volumes through these Black- and African-American owned banks and external managers where we have existing strong banking relationships and look to grow that base, which provides an increased opportunity for these firms to attract more capital. We will create a $100M program that will make its initial investment in collaboration with the FDIC to target Minority Owned Depository
   Institutions (MDIs), which directly enables an increase of funds into local communities (businesses, restaurants, housing, etc.). And, we will establish a $50M investment fund focused on supporting Black- and African American-owned small businesses. The fund will initially focus on investing to improve access to capital, increase skill development, and reduce the technology gaps that exist today.

3. We know how important partners are to the growth of our business. We look forward to investing to increase the number of Black- and African American-owned partners in our US partner community by 20 percent over the next three years. A new $50M partner fund will help with access to capital providing loans to support these partners through their startup phase with the loans recovered over time as their business grows. We will provide $20M of financing to existing and new partners to support their cashflow needs. And, we will invest an additional $3M in training programs covering financial management, tech solutions, and go-to-market readiness.

Our Communities

No company can change the world by itself. But we believe that Microsoft can put the power of data, technology, and partnership to work to help improve the lives of Black and African American citizens across our country. That’s what we’re committed to doing, through a four-part effort.

1. We will strengthen and expand our existing justice reform initiative with a five-year, $50 million sustained effort. Since starting this work in 2017, we’ve come to appreciate the importance of this issue not only to the nation, but to the personal lives of our employees and their families. No one should have to live with the fear of being stopped by the police, harassed while shopping, or bullied in school because of the color of their skin. This conviction has led us to do increasing work advocating both in the Puget Sound and nationally, including in the communities where our employees live.We will build on this foundation by using data and digital technology toward increased transparency and accountability in our justice system. All this work will be backed by public policy advocacy that will increase access to data to identify racial disparities and improve policing. We’ll also use our technology and expertise to support evidenced-based and unbiased diversion programs that direct people into treatment alternatives instead of incarceration. We’ll also use data to promote racial equity in the decisions made by prosecutors, including decisions about who to charge with a crime, the nature of the charge, plea offers, and sentencing recommendations.

2. We will expand our skills work to help Black and African American students and adults develop the skills needed to succeed in the digital economy. Over the next five years, we will expand in 13 states and the District of Columbia the Microsoft TEALS industry volunteer program to bring computer science education to an additional 620 high schools primarily serving Black and African American students. We will also strengthen Microsoft’s support for Historically Black Colleges and Universities, including in computer and data science programs, campus initiatives and partnerships, and curriculum development. Finally, we’ll offer digital skills training to Black and African American adults seeking new jobs. As part of a global skilling initiative, we will provide $5 million in cash grants to community-based nonprofit organizations led by and serving communities of color, enabling them to better support digital skills programs.

3. We will help expand access to broadband and devices for communities of color and the key institutions that support them in major urban centers, by working with carriers, OEMs, our own hardware team, refurbishers, and nonprofits to enrich low-cost broadband access by providing affordable PCs and Microsoft software. We’ll work to ensure these services can be put to effective use to improve people’s lives, with a focus on telehealth services and educational offerings. Backed by public advocacy, we’ll start by focusing on six cities that currently confront the largest urban broadband gaps.

4. Finally, we will increase technology support for nonprofits that support and are led by people of color. We will help support the digital transformation that we know from experience can make nonprofits more effective. We’ll provide access to Azure and Dynamics credits and financial grants that will enable these organizations to add the IT staff needed to better deploy and maximize technology. We look forward to tapping into the knowledge and expertise of our own employees as we identify effective groups we can support more strongly.

Change begins by looking inward. We expect this change in ourselves. Employees expect this change from their leaders. Our customers and partners expect this change from Microsoft. And the world demands this change.

This is not a one-time event. It will require real work and focus. We will listen and learn. We will take feedback and we will adjust. But it starts with each of us making a commitment to do the work, to help drive change, and to act with intention.

Satya

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