The State of Diversity in the Cannabis Sector
One of the things that the cannabis sector could “brag about” before the pandemic years was that women and people of color held more C-suite roles compared to other industries. However, when the pandemic hit, this diversity in a way melted, or so it appeared. A new study traces the trends and suggests that the numbers are now back to how they were in 2019.
Diversity among cannabis executives is “back to normal” if we consider the findings from a new study on the subject. Reportedly, as of 2023, some 39% of business owners in the budding sector are women and around 24% are racial minorities, the study finds.
Compared to figures from 2021, women representation in C-suite positions improved for 22% and for racial minorities it’s 13% climb. The growing rate indicates similarity to how things were in 2019 when women executives in cannabis represented 38% and racial minorities 28%. The study combined both surveys and data reports to gather up these numbers.
“Social equity is a critical component in every cannabis market, new and old,” note the study authors. “However, racial and gender diversity is still lacking—especially in ownership and executive positions. Also missing: hard data about it.”
Has Diversity in Cannabis Really Improved?
The authors clarify that their main goal with this study is to learn if diversity levels improved after the pandemic, and not so much to look at what caused the downward trends during the pandemic.
What should be noted is that the diversity level dropped in times when the cannabis sector stood particularly strong. Namely, profits in the sector went particularly high with the COVID-19.
While it’s good that there are now more women and people of color in the cannabis sector than there were two or three years ago, some questions absolutely deserve further investigation. What were the reasons for decline in the number of women and racial minorities executives in times when cannabis sales climbed to an all time high? Also, what made executives from these groups to come back now when the industry is facing difficult times and crisis?
It might be easier to assume the answer of the second question. One possibility is that leaders coming from groups who have historically been underprivileged and underserved by society come out more resilient. They know how to navigate in the storm because that’s something they are very well familiar with.
It’s more difficult to answer why supposedly so many of this group were gone from C-suite positions when the times for business were good. But if we again assume that women and people of color are more vulnerable when there is a systematic crisis where the health system is falling apart because of a health crisis, perhaps the answer is then very obvious. Were minority groups disproportionately affected by the health crisis?
Alternatively, it could all be a flaw in the statistics. We certainly need more consistent research in this domain; the study authors themselves note that we lack “hard data.”
Maybe the number of women, Black or Hispanic business owners remained somewhere steady while that of white-owned businesses leaped forward with the entry of new legal markets such as Arizona, New Jersey, New York, Montana, Rhode Island…
The period after the pandemic has indeed seen the appearance of a significant number of new markets. And as is so often the case, it’s those with more privilege and fortune who usually have the opportunity to open business first. Everyone else, in particular women and people of color typically come second. This happens despite regulators everywhere are increasingly taking efforts to create markets where the founding value is set to be social equity.
No matter how much we wish for things to be different, that’s the common story of so many sectors, and it’s the same story all over again with cannabis. Those who have money will be in the sector. Those who don’t will wait.
Even with supposedly improved numbers, the lack of diversity continues to be a challenge for the cannabis sector. The industry can do better than 39% women and 24% racial minorities in the C-suite level. Once again, we have to remind ourselves that the War on Drugs has disproportionately affected the same communities that today lack access to entering the cannabis business.
Also read on Soft Secrets:
- 5 Influential Women in the Cannabis Industry
S
Stephen Andrews
