How Dave Chappelle is changing Netflix’s culture

Netflix’s statement that employees should quit if they don’t want to work on shows they think are “harmful” raises questions about the future of diversity, equity and inclusion at a company once praised as a leader in corporate culture.

Seven months after employees walked out over a Dave Chappelle special they called trans- and homophobic, the streaming service revised its extensive corporate culture memo. Dated May 12, it reads: “. . . you may need to work on titles you perceive to be harmful. If you’d find it hard to support our content breadth, Netflix may not be the best place for you.”

The company’s hands-off approach to harmful content was evident nearly two weeks later, when Netflix released a special by comedian Ricky Gervais, who derided transgender women when talking about their pronouns and bodies. Like the Chapelle show, LGBTQ activists quickly denounced Gervais and Netflix, saying they are reinforcing stereotypes that could lead to physical harm against transgender people.

Netflix defends its stance on harmful content in the name of the “artistic expression” of its content creators. The revision comes as the company is struggling financially, losing subscribers for the first time in a decade: 200,000 during the first three months of 2022.

What’s next?

Mistakes in diversity, equity and inclusion often run in streaks, which means many observers will be watching closely what Netflix does next. Even as it doubles down on its harmful content policy, Netflix may be missing a different chance to get back on track.

In 2019, Netflix was the first major Hollywood studio to oppose a restrictive abortion law passed in 2019 by Georgia, an important center for television and movie production. Yet the company has so far stayed on the sidelines after reports of a draft opinion by U.S. Supreme Court that would overrule Roe vs. Wade, like many major corporations.

Netflix is a client of public relations firm Zeno Group, which counseled its clients to avoid comment, calling abortion rights a “textbook ‘50/50’ issue” that divides the country and can be a “no-win” situation for companies.

These recommendations may have worked in the past, but employees especially aren’t having it. These attitudes began changing even before the May 2020 murder of George Floyd, when Netflix was one of the first entertainment giants to issue a statement.

Ironically, Zeno Group’s parent company makes this point in the Edelman Trust Barometer 2022, which says that people “want more, not less, business engagement on societal issues.”

Depth of experience

It’s this chasm that spurred one of the authors of this article, Kim Clark, to team up with Diversity Pragmatist and TED Speaker Janet M. Stovall to co-author the book, “The Conscious Communicator: The fine art of not saying stupid sh*t” (due for release in September 2022). In the book, they introduce a scalable, sustainable framework to guide communicators to reach a position of strength around what, when, why and how to communicate on topics such as reproductive rights, voter suppression, racial equity and GBTQ+ rights.

The framework is called the DEPTH Model: Deliberate, Educated, Purposeful, Tailored, Habitual. When aligned with an organization’s mission, vision, values, purpose and core competencies, the framework gives communicators the grounding to offer more helpful advice for their clients than just say no.

Culture change

One of the five giants in tech, Netflix’s first culture statement broke new ground when it was issued in 2009, prompting other companies to follow with their own statements about their cultures and policies, experts have said. Co-founder board chair and co-CEO Reed Hastings even wrote a book in 2020 elaborating on the company’s principles.

And then came the Chapelle show, released Oct. 5, 2021, which drew outrage for jokes that denigrated transgender people. It was wasn’t the first time Chapelle has been rebuked for such humor. Netflix co-CEO Ted Sarandos defended the show. On the eve of the employee walkout on Oct. 20, he admitted, in a masterful understatement, that he “screwed up that internal communication.”

Employees increasingly care not only about how the company treats them, but also how the company treats their coworkers. The episode, together with Netflix’s “Don’t like it? Leave” approach, is expected to hurt the company in recruiting new employees and retaining existing ones.

Yet this may be of little concern for Netflix, which this month announced it is laying off 150 employees, or 2% of its workforce, which include many women of color leading content creation for Netflix.

Meanwhile, the market for high-priced entertainment talent is fiercely competitive. A key question will be whether the company has helped or hurt its ability to attract the “content creators” it cherishes. Performers are not shy about expressing their opinion about social issues but may be troubled by the new belt-tightening approach outlined by the culture memo.

The best advice for Netflix may come from a statement often attributed to Will Rogers: If you find yourself in a hole, stop digging.

Kim Clark is an affiliate consultant with Ragan Consulting Group focuses on diversity and inclusion communications. RCG specializes in corporate communications training, consulting and strategic counsel. Schedule a call with Tom Corfman to learn how we can help you improve your communications efforts. Follow RCG on LinkedIn here and subscribe to our weekly newsletter here.