The Power of "OUT"

LGBT in the Workplace

Sylvia Ann Hewlett, Karen Sumberg

• Publisher: Rare Bird Books, A Vireo Book
• Year: 2013
• eBook ISBN: 9780988745636
• Topic: Social Sciences
• Subtopic: LGBT Studies
• Index: Social Sciences

Until now, the line has not been clearly drawn between the corporate closet and the revolving door. New research from the Center for Work-Life Policy quantifies the loss to U.S. companies that fail to create a workplace hospitable to their lesbian, gay, bisexual, and transgender employees. Our data show the consequences of LGBT employees forced to keep their lives and loved ones a secret from colleagues. Also included in the report are cutting-edge initiatives employed by a range of companies to break down barriers for their LGBT employees.

Chapter 1

Out and Not Out: The Great Divide

Todd Sears’s first journey out of the closet began during his senior year of high school, after he saw the Broadway production of Tony Kushner’s Angels in America on a visit to New York City. By the time he graduated from Duke University he was all the way out—to his fraternity, his family, everyone. When he moved to New York after graduation to start work at an investment bank, it never occurred to him to hide his identity. “Then my first week on the job my boss called somebody else on my team a faggot,” Sears recalls. “So I promptly went back in the closet.”

But he was determined to be out in his private life, so he spent a full year shuttling between his two identities. The double life took its toll. “It created a lot of stress and exhaustion,” he recalls. “There are so many things you can’t say or that you have to lie about. And what if you see someone from work while you’re out? Even when you’re not at work, you’re constantly on guard.”

For a while Sears muddled through, putting in long hours as an analyst and keeping his private life private. “But I very quickly decided that this was not going to be a company I was going to stay with for a long period of time,” he says. After only a year Sears found an open position at a small, boutique investment firm that specialized in media. This time, he came out to the firm’s partners in his interview, and they were immediately receptive and encouraging. “I was definitely nervous to do it, but it ended up being a great thing for me; not only for me but for the firm.” A newly motivated Sears brought a unique perspective to the table. In 2000, for example, when the two largest LGBT publications merged, Sears’ firm was brought in to advise on the deal. “My being gay definitely helped us with that relationship,” he says. He also helped cement the firm’s relationship with another conglomerate media client whose CEO was gay.

When Sears took a position as senior financial adviser with Merrill Lynch, again as an out gay man, he quickly helped the firm target the largely untapped high-net-worth LGBT market through partnered events and sponsorships of LGBT nonprofits. In exchange for Sears’ financial planning seminars, Merrill Lynch got access to ultra-high-net-worth donors, many of whom were eager to hire a financial services firm that understood their needs and that was highly visible and active in the LGBT community. In his first five years there, as the first team on Wall Street to focus on the LGBT market, Sears and his team helped bring in over a billion dollars in new business (see page 424 for full description). Looking back now, Sears sees that the corporate world has come a long way since the ’90s, but the pink ceiling is still very much a reality. “Entry level is one thing, but as you get up in the ranks, does it start to hurt your chances? That’s the question.”

Though Sears ultimately chose full disclosure, his initial retreat to the corporate closet is not at all uncommon. All too often, LGBT employees opt to put away their family photos and hide their private lives when they perceive a risk to their careers. Overall, our study revealed that just under half of all LGBT employees, or 48%, are closeted at work.

Thirty-three percent are living double lives—out to their family or friends but closeted on the job. And for many, simply being in an environment they perceive as threatening or hostile can take an enormous toll. In a 2007 study, “Making the Invisible Visible: Fear and Disclosure of Sexual Orientation at Work,” authors Belle Rose Ragins and Romila Singh, professors at the University of Wisconsin-Milwaukee, and John Cornwell, a professor at Loyola University in New Orleans, found a strong correlation between the fear of negative consequences of coming out at work with more physical stress-related symptoms, along with negative career attitudes and fewer promotions, than those who reported less fear. “The critical piece is the fear. It was the fear of coming out, the fear of negative repercussions—not being out itself—that was associated with stress and negative job attitudes,” says Ragins.8

That fear is often at odds with an ambition to excel that is equal to that of their straight counterparts. Fully 88% of LGBT employees are willing to go the extra mile for employers, the same percentage as straight employees, and 71% consider themselves very ambitious, compared with 73% of heterosexuals. Two-thirds of LGBTs are eager to be promoted, roughly the same as their straight counterparts. And although there are few out gay senior executives in corporate America today, LGBTs aspire to the executive suite at the same rate as straight employees.

Yet even for the most ambitious LGBT employees, being forced to stay in the closet—or feeling penalized once they do come out—can make the journey to a higher position feel like a boulder-strewn, lonely climb. It doesn’t help that they have to expend an enormous amount of energy simply keeping their stories straight, leaving less for doing the kind of work they need to advance. This was the case for Jeffrey Siminoff, now managing director and global head of diversity and inclusion at Morgan Stanley, early in his career at another company. “For me, when people asked about my personal life, I always used ‘we’—though who was included in that ‘we’ or any equivalently vague reference was never specified. I was too exhausted to think about how I would actually talk about an important part of who I was as a person—and I wasn’t convinced that I openly could.”

Forced to lie about their private lives, they are excluded from the collegial banter about weekend outings and personal interests that forge bonds in the workplace. Without that networking, employees can easily feel disengaged and unmotivated. “Any time I’m not comfortable at work, I don’t do my best, I don’t impress anyone, I don’t do the best work I can,” says 29-year-old Nathan Knight, an associate with Booz & Company, recalling the six months he spent in the closet at The Home Depot before coming out.

Not surprisingly, those who can’t be themselves at work for fear of being stigmatized are often less productive according to workplace advocate Louise Young, senior software engineer at defense and aerospace company Raytheon. In an effort to help win support for Raytheon’s domestic partner benefits and nondiscrimination policy, Young, the founder of their GLBTA (Gay, Lesbian, Bisexual, Transgender, and Allies) employee resource group, devised a formula in 1996 to quantify the productivity lost by companies who fail to create a safe and inclusive workplace for LGBT employees. Her formula assumes, conservatively, that the number of LGBT employees in any workplace will be at least 5% and the amount of productivity associated with a safe and equitable workplace at 10%. For example, a company with a workforce of 1,000 employees would have 50 LGBT employees (1,000 x 0.05=50). If the average annual salary is $40,000, the average loss in productivity per LGBT worker per year is $4,000 ($40,000 x 0.10=$4,000) and the total annual loss to the company in productivity would be $200,000 (50 x $4,000=$200,000).9

That may partly explain why closeted LGBT employees feel so much more constrained in their career paths than those who are out. More than half of those in the closet, or 52%, said they felt stalled in their careers compared with 36% for out employees (and 49% of heterosexuals). At the mid-management level, where stalling is particularly acute, the disparity is even more dramatic. Fifty-one percent of those who are out say they feel stalled compared to 70% of those who are not out, adding to the already challenging journey to the top. Just under half are satisfied with their rate of advancement and promotion compared with nearly two-thirds of those who are out. And the gap widens even further for gay men: 54% of closeted gay men feel stalled versus just 32% of out gay men. And only 34% of closeted gay men feel satisfied with their rate of promotion versus 61% of those who are out.

That dissatisfaction with their pace up the corporate ladder makes it much more likely that LGBT employees will have one foot out the door. According to our research, those who are unhappy with their rate of promotion or advancement are at least three times more likely than those who are satisfied to plan to leave their companies within the next year. LGBTs who feel isolated at work—closeted LGBT employees burdened with the stress of daily secret-keeping and isolation from peers—are 73% more likely to say they intend to leave their companies within the next three years than those who are out.

Conversely, as Jeffrey Siminoff of Morgan Stanley told us, those working in an inclusive culture that makes LGBT employees feel they can bring their whole selves to work are the kind of employees any company would want—productive and happy.

The bottom line: LGBT employees who stay on track and make it into senior management are much more likely to be out than closeted.

Like Sears, many up-and-comers will decide that they ultimately don’t see a future at a company where they can’t be themselves. Given the exorbitant cost o...

Table of contents

• Introduction
• Foreword
• Abstract
• Introduction
• Chapter 1
• Chapter 2
• Chapter 3
• Going Global
• Chapter 4
• Appendix
• Methodology
• Acknowledgments
• Endnotes
• Task Force for Talent Innovation Members
• About the Authors
• About the Task Force for Talent Innovation