November 24, 2021
Pinterest pledged $50 million to overhaul its corporate culture and promote diversity as part of an agreement to resolve allegations that it discriminated against women and people of color, according to court documents and statements from the plaintiffs and the company.
The settlement was announced on Wednesday by Seth Magaziner, the general treasurer of Rhode Island, who was acting on behalf of the Employees’ Retirement System of Rhode Island and other Pinterest shareholders that had sued the company, which is known for its colorful virtual pinboards.
The shareholders had accused Pinterest’s board of directors of failing to respond to a culture of discrimination and retaliation against women and people of color. By allowing the discrimination to continue, the shareholders argued, the board had failed to act in the best interests of stockholders.
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Under the settlement, an audit committee of the board will help oversee changes intended to create equal opportunities for employees. The changes require that a board member act as a co-sponsor with the chief executive on diversity, equity, and inclusion initiatives, according to the plaintiff’s legal team.
The settlement also releases former employees from nondisclosure agreements and creates an external ombuds office for employees and external audits that review performance ratings, promotions and compensation across gender and racial categories.
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