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Estée Lauder ousts exec for racist post: PR and crisis comms experts respond

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By Kendra Clark | Senior Reporter

March 1, 2022 | 7 min read

Estée Lauder, the cosmetics titan that owns major beauty brands including Clinique, Aveda, Too Faced and Bobbi Brown, has forced out longtime executive John Demsey for sharing a racist meme to his Instagram page. And it’s not the first time the company has been the subject of scrutiny when it comes to equity and inclusion. PR and communications professionals who specialize in helping brands navigate scandals weigh in on what the company needs to do next.

Luxury cosmetics label Estée Lauder on Monday announced in a letter that it has fired a senior executive after he acknowledged that he made an Instagram post containing a racial slur.

Estee Lauder storefront

Estée Lauder has ousted a top exec after he posted a racist meme to Instagram

John Demsey, who served as the company’s group president and formerly oversaw Estée Lauder brands including Mac Cosmetics, Clinique and Smashbox, last week posted an offensive meme to his personal Instagram account. The meme, which contained racist language, featured Sesame Street characters and appeared to make light of the Covid-19 pandemic. The post has since been wiped from the executive’s page.

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Last Thursday, the 65-year-old Demsey was suspended without pay. The following day he issued an apology on his Instagram account, claiming that he “carelessly repost[ed] a racist meme without reading it beforehand.” He expressed regret and said that “the meme is the furthest thing from what I stand for.”

However, after putting Demsey on leave, the cosmetics company announced that Demsey has been forced out. “This decision is the result of his recent Instagram posts, which do not reflect the values of The Estée Lauder Companies, have caused widespread offense, are damaging to our efforts to drive inclusivity both inside and outside our walls, and do not reflect the judgment we expect of our leaders,” read a staff letter shared publicly on the company’s investor relations site.

The letter went on to emphasize that Estée Lauder sees “inclusion, diversity and equity” as “core to [the] company’s values and priorities globally.” The company said it has made efforts to improve inclusivity and equity over the past two years.

By the time the markets closed on Monday, Estée Lauder’s shares had dipped 1.33% to $296.33.

It’s not the first time that the cosmetics company has come under fire for diversity- and inclusion-related issues. The company faced widespread backlash in 2020 when it was accused of hypocrisy; in the wake of the murder of George Floyd, Estée Lauder pledged to donate $1m in support of racial justice efforts, but kept founder’s son Ronald Lauder on its board of directors, despite his position as a prominent Trump donor.

Crisis communications expert Sara Brady, who operates a private PR consultancy, says that Estée Lauder faced a test with Demsey’s Instagram post. Where the company could have issued a slap on the wrist to the long-standing exec, it “passed thanks to swift and serious action.”

Other experts agree that ousting Demsey was the appropriate first step. Evan Nierman, founder and chief executive of Red Banyan Crisis PR, a public relations firm dedicated to helping companies navigate crises, says: “The ... company has already taken the bold step of ousting Demsey, but the decision makers are no doubt seeing this as a blunder that has set the company back after its pledges of inclusion a couple of years ago.” Moving forward, Nierman suggests, the cosmetics giant will need to double down on its existing diversity, equity and inclusion efforts.

But investing more deeply in inclusivity and equity is no easy task. “Reinforcing values of inclusion and diversity requires persistent efforts to keep them from being dismissed as politically correct, performative lip service,” says Nierman. “From the products developed, to the models cast, to the hiring practices undertaken and the overall tenor of the boardroom and the organization, [cosmetics companies] need to assess their entire operations and consider areas where they may be ignoring or excluding some.”

Outside of further investment in diversity, equity and belonging-focused policies, practices and education, some experts suggest that Estée Lauder would do well to not only ensure its employees’ attitudes and behaviors reflect company values, but also that their employees are being thoughtful of how they use social media and communicate publicly. Dr Karen Freberg, associate professor of strategic communication at the University of Louisville and expert in social media, tells The Drum: “Estée Lauder not only needs to invest in more diversity, equity and inclusion training and education internally, but also media literacy.”

Experts agree that employees’ online behavior has more sway than ever when it comes to determining a brand’s identity – and that as a result, brands are more likely to come down on an employee whose online presence doesn’t reflect the company’s stated values. “[This is] yet another cautionary tale for all companies that their executives represent them 24/7, even when [what is expressed is] unintentional and on personal social channels,” says Aaron Kwittken, founder of Stagwell-owned PR and brand strategy firm KWT Global. “‘Views are my own’ doesn’t mean your views can’t get you sacked. All executives need to be trained and re-trained on social norms, cues, best practices and social codes and that what you say can and will be used against you, and it will be merciless.”

A filing with the United States Securities and Exchange Commission made it clear that Demsey is expected to step down on Friday March 4. He was among the highest-paid executives in the company; a regulatory filing made in September indicates that Demsey’s 2021 compensation totaled $9.6m.

Estée Lauder did not respond to requests for comment.

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