Prada established a Diversity and Inclusion Advisory Council in 2019 © Mairo Cinquetti/NurPhoto via Getty Images

Prada appointed its first chief diversity officer last month, as big-name luxury businesses continue to respond to tight scrutiny of their progress on diversity.

The move followed an investigation by the New York Commission on Human Rights into Prada’s diversity and inclusion practices that in February led to its Milan-based executives — including head designer Miuccia Prada and her husband and chief executive Patrizio Bertelli — agreeing to undergo “racial equity training”.

The Italian luxury fashion house had come under fire in December 2018 after Chinyere Ezie, a civil rights attorney, spotted a pair of black, Sambo-esque monkey figurines in Prada’s SoHo store in New York. Prada swiftly issued an apology and removed the offending merchandise.

The brouhaha could perhaps have been avoided if Prada’s workforce had been more racially diverse. At the time of the incident, there were no black employees at Prada’s Milan headquarters, Ms Ezie wrote in an email to the FT, citing a conversation she had with Prada chairman Carlo Mazzi in March 2019. Prada declined to comment.

Chinyere Ezie
Chinyere Ezie, a civil rights attorney, posted pictures of the Prada figurines on Facebook

In 2019 Prada established a Diversity and Inclusion Advisory Council, co-chaired by the artist Theaster Gates and film-maker Ava DuVernay. And last month Malika Savell became the company’s first chief diversity, equity and inclusion officer for North America.

Dozens of luxury companies posted messages of support on social media for the Black Lives Matter movement following the police killing of African-American George Floyd in May.

Yet many of these brands lack diversity in their own ranks and, therefore, are open to risk of severe reputational damage — as Prada, Gucci and Dolce & Gabbana have each learned from their own recent high-profile missteps.

Prada hired its first diversity lead, Malika Savell, last month
Prada hired its first diversity lead, Malika Savell, in October © Alessandro Fresco Cerdas

Less diverse businesses are also likely to be less innovative, which can drag on the top line.

A Boston Consulting Group study in 2018 found that companies with above-average diversity within their management reported innovation revenue that was significantly higher than that of companies with below-average diversity — at 45 per cent of total revenue versus 26 per cent.

Gucci hired its own diversity chief last year following a backlash for retailing an $890 jumper also said to resemble blackface. Burberry and Chanel have also hired diversity leads in the past two years.

Models present creations for Prada fashion house during the Women’s Spring/Summer 2019 fashion shows in Milan, on September 20, 2018.
© Andreas Solaro/AFP via Getty Images

These are all positive signals that the $318bn industry is making progress — not only on racial diversity, but also in the greater representation of women, as well as employees who are disabled or above the median age.

The Financial Times’ second annual Diversity Leaders list, compiled with research partner Statista, shows the extent to which companies in 16 European countries have achieved a diverse and inclusive workforce, based on the perceptions of their employees and recruitment experts.

Respondents were asked to rate the efforts of employers in their respective sectors in promoting diversity. They were also asked to share their opinions on a range of statements around age, gender, equability, ethnicity, disability and sexual orientation. The evaluations of more than 100,000 employees informed the final ranking.

Luxury is well represented in the top 850 companies featured this year. Ranking fifth overall, Hermès is the second-best improver on last year’s list, where the French fashion house ranked 535 out of 700 companies.

It performed strongly on ethnicity and diversity in general last year — and this year it was one of only eight companies to score above 3.8 out of 5 on ethnicity. Yet its biggest improvement is on gender and disability.

Hermès places fifth on the ranking
Hermès places fifth overall on the Diversity Leaders ranking © Getty Images

Giorgio Armani comes in at number six, while Prada (57) and Hugo Boss (97) make it into the top 100.

Prada scored well on LGBT+ and diversity in general, and lowest on ethnicity and age. LVMH does not show in the top 850 — though several of the group’s brands do, including cosmetics company Sephora (49) and Louis Vuitton (161) — the luxury fashion industry’s largest brand by revenues, which analyst Bernstein estimates at $12.9bn last year.

Cartier-owner Richemont narrowly missed out on the final list. However, the Swiss group hired a director of diversity and inclusion in early 2019, and is creating similar positions across its brands and geographies, says an individual familiar with the group’s plans.

Gucci’s French parent Kering, which in recent years has been commended for the high representation of women on its board — eight of its 13 board seats are held by women — ranked 715th. It performed less well on age and ethnicity than the likes of Hermès or Giorgio Armani.

Observers say the luxury sector still has a long way to go in terms of ethnic diversity, and that it lags behind its counterparts in the broader fashion space.

The luxury industry has made “meaningful attempts at progress”, says Hannah Stoudemire, chief executive of the Fashion for All Foundation, a New York-based non-profit that promotes equality and diversity in the fashion industry. “[But] a lot of companies are not doing the bare minimum,” she adds.

“Specifically in luxury, there are [very few racially diverse] employees that hold senior creative positions. I could say the same about senior decision-making roles.”

Ms Stoudemire advises companies to address diversity issues at all levels of the organisation and create “space and a budget” for a chief cultural officer.

“This role should be mandatory and had at every company in fashion, beauty and media,” she says.

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