Every June, company websites and social media pages are awash with the rainbow hues of the Pride flag representing the LGBTQ+ community. Though RuPaul did say, “Life is about using the whole box of crayons,” companies that do so only during Pride month might be “rainbow washing” instead of standing as genuine allies.
In actuality, prioritizing diversity, equity and inclusion (DEI) for the LGBTQ+ community and other marginalized communities is a year-round, long-term effort, one that emphasizes inclusion for employees and customers alike. Here’s what organizations need to know about rainbow washing — and how they can make a more significant impact with DEI efforts.
What Is Rainbow Washing?
Rainbow washing is when companies use rainbow colors on logos, products, websites and more to signal support for the LGBTQ+ community. But the issue isn’t the colors themselves; it’s that companies sometimes use rainbow colors to win the business of queer allies without actually furthering equity and inclusion for individuals who identify as LGBTQ+.
Rainbow washing means remaining politically and socially neutral while still sporting rainbow colors. It’s developing colorful campaigns without the leadership or contributions of LGBTQ+ individuals. Rainbow washing can happen year-round, but it’s especially easy to spot during June’s Pride Month. For example, companies may feature LGBTQ+ employees wearing Pride merch yet lack queer representation on their boards or executive teams, or they may lack any significant action that furthers LGBTQ+ inclusion and equity.
“We understand and deeply appreciate your corporate logo going rainbow on June 1st and back to black and white on July 1st, but show me [what you're doing],” says Jonathan Lovitz, LGBTQ+ advocate and candidate for Pennsylvania’s House of Representatives. “And more importantly, [show me] with the paper cash you're putting into the community [and] your equitable investments in making things better the 364 days that aren't when your company marches in Pride.”
The History of Rainbow Washing and Pink Money
Rainbow washing may seem like an innocent show of support, but it actually comes down to money. In the 80s and 90s, LGBTQ+ individuals began to live openly and with pride. Although they met (and continue to meet) opposition, marketing agencies saw the blossoming LGBTQ+ community as an emerging market, one from which they could generate a lot of revenue.
Then and now, the LGBTQ+ community was a buying power to be reckoned with; as of 2019, that buying power reached $3.7 trillion, while LGBTQ+ spending in 2021 surpassed $1.4 trillion. This collective buying power is referred to as pink money, money that corporations have been keen to capitalize on through rainbow colors and queer-centered merchandise.
While this boosted representation for LGBTQ+ individuals, it did nothing to create opportunities or even make life safer for the 7.1% of U.S. adults who identify as LGBTQ+. Rainbow washing is the legacy of this 30-year-old LGBTQ+ marketing push, one that companies of today must work to move past.
Why Does Rainbow Washing Matter?
Rainbow washing has two significant implications: It leads customers to think they’re supporting LGBTQ+ communities while further marginalizing LGBTQ+ individuals by co-opting Pride.
A 2021 study found that gay and lesbian-friendly firms were actually more profitable and had a higher stock market valuation than their counterparts. In other words, the more LGBTQ+ friendly a company is, the better it performs — and this is largely because LGBTQ+ individuals and allies alike are more likely to support inclusive businesses. But in the case of rainbow washing, this LGBTQ-friendliness isn’t what it seems, as it ultimately misleads customers into supporting businesses that view Pride as nothing beyond a marketing opportunity.
But it isn’t just about the pink money. Rainbow washing also often takes opportunities away from the LGBTQ+ communities since many of these campaigns co-opt LGBTQ colors yet come from individuals and businesses that don’t identify as LGBTQ+ or as allies. It also makes it harder for LGBTQ+ individuals to identify organizations that actively protect their interests and that strive to create more inclusive communities.
Rainbow Washing Examples
Of course, organizations can use the colors or iconography of Pride without it being considered rainbow washing. So how can businesses tell the difference between corporate rainbow washing and allyship? The critical thing to remember is that rainbow washing is performative, meaning it’s acting like an ally without taking concrete, longer-term steps to advocate for the LGBTQ+ community.
Here are some of the most common examples of rainbow washing:
- Using rainbow colors in company logos, websites and social presences for the month of June, then returning to “business as usual” for the rest of the year without clearly investing in the LGBTQ+ community year-round.
- Developing queer-centric merchandise or campaigns without the contribution of queer-identifying individuals.
- Underpaying (or not paying) the LGBTQ+ individuals the organization does work with.
- Publicizing queer employees and their perspectives on the organization’s LGBTQ-friendliness, yet lacking queer representation on executive teams or the board.
DEI Should Be a Year-Round Investment
Businesses that avoid rainbow washing instead invest in DEI year-round. This means prioritizing diversity, equity and inclusion at all levels, from the board of directors all the way down to those selling products or manning the storefront.
“A company who's getting it right, a local government whose social media and web presence is getting it right, is making sure that it's not just pride stuff in June. That it's, 'What are we doing for this community all year long? And [for] every other community?'” Lovitz says.
While DEI is a long-term commitment, it doesn’t have to be complicated. Here’s how organizations can incorporate DEI into their day-to-day activities.
- Invest in Diverse Leadership: Boards of directors guide company visions and initiatives. So if the board isn’t yet diverse, how can they effectively lead a company that is? Boards of directors should be a reflection of their employees, customers and stakeholders, which means involving people of all backgrounds, including different gender identities and sexual orientations. Leadership should also make authentic statements about this, acknowledging where the organization is now and how they plan to move forward.
- Dedicate Time and Money to DEI: Investing in DEI requires putting time, money and other resources into developing DEI at all levels of the organization. This can look take many forms, such as providing ongoing training to employees and leadership, equally paying employees no matter how they identify, employing people to work solely on DEI and making time in the workday for DEI.
- Include DEI in the Day-to-Day: DEI should be an important part of any organization’s mission, vision and values. Embed diversity from the very start so that it becomes a natural part of workplace culture and employee conduct. This also means having an accountability structure, so employees can look to a DEI individual or team to further DEI representation in the workplace.
- Change Policies to Further DEI Opportunities: It’s critical to listen to employees’ concerns regarding DEI; it’s even more important to use their concerns to make changes. Organizations committed to DEI are willing to change their policies as their understanding of and needs for DEI change. This is one of the best ways to encourage a diverse employee culture.
- Employ (and Fairly Pay) Diverse Employees: Diversity promotes innovation. Having a mix of cultures, backgrounds, education levels, races and identities in the room helps companies break out of their own feedback loops and actually take new, interesting steps forward. Organizations should actively seek out diverse employees and ensure that they’re paid fairly. You can tap into a vast pool of highly qualified and board-ready candidates through the Diligent Director Network.
Start Driving Board Diversity
Diverse boards matter, not just because they can help avoid rainbow washing. Diverse boards encourage innovation and bolster stakeholder confidence, both of which are critical if organizations want to stay competitive. But investing in DEI may seem daunting for boards that aren’t already diverse.
Get started with the Board Diversity Playbook from Diligent, which includes Diligent’s roadmap for best practices, strategies and technologies that drive board diversity. Download the playbook now to start making diversity a priority for your board.
To learn more about best practices in DEI and how to advance DEI initiatives within your organization, register for Diligent’s ESG certification course.
Read more about Diligent’s commitment to DEI.
