Two years after former employee Tracy Evans filed a federal racial discrimination lawsuit against Founders Brewing Company, the anger captured in this reoccurring social media hashtag has hardly slowed. Yet with a forthcoming diversity statement in the works, Founders is beginning a concerted effort to try and regain the lost trust that that hashtag signifies.
Whether the brewery is successful—and whether new policies make up for previous missteps in its diversity, inclusion, and equity efforts—remains to be seen.
Evans, who is Black, filed a lawsuit on Aug. 22, 2018, alleging that his coworkers used the n-word in his presence, that he was passed over for a promotion, and that the brewery harbored a “racist internal corporate culture.”
A pair of public embarrassments followed. In a leaked deposition, a Founders manager wouldn’t admit knowing whether or not Evans, his colleague, was Black. Then the brewery’s first diversity and inclusion manager, Graci Harkema, resigned because of her belief that the company wasn’t committed to pursuing equity.
Even though Founders is commonly invoked as everything wrong with race relations in the beer industry, the company now says it’s found its footing. Evans and Founders reached a settlement last year, and the brewery has said the matter is in the past—case closed.
Whatever comes next, Founders will continue to serve as a case study for an industry that’s grappling with its mostly white, mostly male identity. Whispered accusations, rumored wrongdoings, and documented offenses within the industry are numerous; Founders has stood in as the catch-all. Whether it can satisfactorily make amends with a new approach to diversity, equity, and inclusion (DE&I) will have ramifications for the beer industry far beyond Michigan.
Since Evans’ lawsuit began, the Grand Rapids, Michigan-headquartered brewery, which also operates a taproom in Detroit, has existed in two worlds. There are those consumers who have followed the news closely and who loudly refuse to support a company they believe has harbored racism. Then there are those who aren’t aware of the lawsuit, or support the brewery in spite of it, and have continued to make Founders one of the fastest-growing breweries of the past decade.
Founders is the 14th-largest American brewing company by sales volume, according to the Brewers Association. Dollar sales of Founders beer have continuously grown in recent years, increasing nearly 9% in grocery, convenience, liquor, and other retail stores for the 52 weeks ending July 12, as tracked by market research company IRI. If consumer boycotts are a tool for changing corporate behavior, sales numbers indicate Founders hasn’t felt that pressure. Annual dollar sales of Founders beer have continued in an upward trajectory, growing from $102.4 million in 2017 to $143.2 million in 2019 in IRI-tracked stores. In the first seven months of this year, Founders sold about $100 million in those stores.
When asked about its diversity, equity, and inclusion (DEI) work, Founders tells GBH it plans to release a diversity statement that will outline its values, and which will form the baseline for ongoing efforts. (Founders declined to provide that statement to Good Beer Hunting, saying it wanted to release it on its own website.) The company has also hired two consultants, regarded as leaders in the field, to help it focus on this work. Outside experts say Founders’ plans for a multiyear program are comprehensive in their metrics-based, company-wide approach. But will they include an admission of wrongdoing, and an apology? And even if an apology is forthcoming, will that be enough to repair the damage done?
In late 2019, Founders scrapped its prior approach to diversity, equity, and inclusion, which had been led by diversity and inclusion manager Graci Harkema. (Harkema resigned in October 2019.) The brewery says its former efforts, spearheaded by just one person, were too focused on training and education sessions rather than procedural changes, such as implementing new hiring practices or auditing the brewery’s supply chain for diversity. The company’s DE&I webpage acknowledges “changes needed to be made to our existing Diversity, Equity and Inclusion program. As a result, we started over.”
This restart is designed to be a more systematic, metrics-based approach led by consultants and with buy-in from all of Founders’ 503 employees. That buy-in comes in the form of focus groups, surveys, and planned employee resource groups. The company says 10% of its employees are members of the new Diversity Action Council (DAC) or “stakeholder groups” that advise the DAC. The new diversity, equity, and inclusion plan has thus far included:
Hiring an interim DE&I director, Buzz Thomas, in December 2019. Thomas is a former Michigan state senator and president of Thomas Consulting Group, a management consulting firm.
Creating a DE&I program with the assistance of consulting firm Global Bridgebuilders, which specializes in diversity processes.
Forming an employee-led Diversity Action Council (DAC) with five DAC subcommittees, each with specific goals: leadership, communication, organizational processes (essentially human resources functions), external relationships (including vendors, customers, and communities), and systems criteria (auditing and metrics).
Reviewing the brewery’s supply chain for diversity, meaning the company is evaluating and scoring the top 10 vendors for each of its departments based on those companies’ DE&I efforts.
Creating employee resource groups, partnering with historically Black colleges and universities on internships and other programs, providing culturally competent customer service training to front-of-house staff, and more. Each of these goals has metrics and benchmarks associated with it, which are later used to evaluate programs’ efficacy.
Experts in the field say a comprehensive process like the one Founders has committed to is in line with industry recommendations.
“From listening to what they’re doing, it looks like it hits all the marks very well,” says Dr. J Nikol Jackson-Beckham, an equity and inclusion strategist and executive director of Craft x EDU. “Signing on with these two firms, only time will tell if it’s the right move long-term, but to me it’s a sign that they’re understanding that it is a project with tremendous scope.”
When Founders says it needed to press the restart button, it’s referring to the resignation of former diversity and inclusion manager Graci Harkema, who’d worked for the company for nine months. Harkema resigned with a public letter addressed to Founders in which she wrote, in part: “Your actions have explicitly shown you are more interested in the optics of my face than the impact of my voice.”
Harkema was initially excited about her position at Founders because it was a chance to make an impact on the company’s culture, and the beer industry as a whole. The breaking point came after details from Evans’ lawsuit became public.
“They handled the response to the leaked deposition by defending themselves in the lawsuit rather than acknowledging racist behavior on their part and on the part of the systemic racism that we see in our country,” Harkema says. “The leadership team did not want to address the issues and their pitfalls on diversity and inclusion.”
Founders continues to defend its corporate culture. Mark White, Founders’ Central U.S. key account director (part of the sales team), is a Black man and a member of the brewery’s DAC.
“I know racism in this industry; I have experienced it. And I just haven’t felt that at Founders,” he says. Speaking later about the DAC’s work regarding implicit bias, though, White adds: “There are probably people at Founders who’ve never had a business relationship, a professional relationship, with someone of color.”
Chief operating officer Brad Stevenson calls the brewery’s employees “a happy family” while acknowledging he personally had “some awareness to gain on being more intentional [about DE&I].”
He says Harkema’s resignation made the brewery realize it needed to take a new approach to DE&I efforts. It took her public resignation to make the leadership team pivot to a more formalized approach.
“I think what you see with Graci’s departure is how an approach of an individual and personality and presentation mode of DE&I is not effective,” Stevenson says. “I think there was just a frustration level on her part.”
Harkema’s resignation a year ago speaks to a key tension for the company. She says she resigned because she was frustrated and didn't see change. Meanwhile, Stevenson says that the DE&I efforts she led weren’t going to be effective because they were headed by only one person. Founders’ initial structure—expecting a sole DE&I director to enact company-wide change—set her up to fail, a fact that led to Founders’ new approach.
Harkema, who still lives in Grand Rapids, says the brewery’s recent actions—donating to Black Lives Matter and participating in the Black Is Beautiful collaboration beer—are meaningless if it doesn’t address its own mistakes. She characterizes the failure not as a staff issue, but a leadership issue.
“If those actions are not prioritized at the top, the rest doesn't matter,” she says. “They still have never apologized and have never taken responsibility publicly. Now they’re putting up window dressings but have never done anything to fix the foundation of the house.”
But what happened at Founders is not a unique experience, and other people of color in the industry have acknowledged similar experiences to Harkema’s.
Shakia Hollis worked as director of private events and community engagement for Atlanta-based Monday Night Brewing from 2017 to 2020. While everything with Founders took place outside of her daily scope, she says it’s easy for her to relate with her own experiences as a Black woman.
Over her four years at Monday Night, where she started as a sales rep, Hollis says she continually worked to prove herself to those around her. She says it took more time and effort to convince buyers that she was good at her job selling beer, while she would regularly see bearded, white men have a much faster and easier time with accounts.
After finishing at Monday Night in August, Hollis is uncertain if she’ll return to the industry in the future. She declined to tell GBH specifics of her reasons for departing the Atlanta brewery, and Monday Night leadership didn’t offer any statement when reached for comment other than to offer support for Shakia’s decision to resign. In a statement to GBH, Monday Night co-founder and CMO Jonathan Baker added that they didn’t want to impinge on Hollis’ “ability to speak her truth.”
“Craft beer is beautiful in a lot of ways,” she says. “But for the first year and half [at Monday Night], I would come home just exhausted, like this just feels unfair and I’m tired mentally.”
Hollis sees a need for the industry to confront hard truths, from how servers communicate with Black customers when they walk into a taproom to how Black employees feel about the environments in which they work. She says if a young Black person were to ask her about working in the industry, she would advise caution.
“The first step is looking internally: This is what I could potentially face, coming into a predominately white industry,” she says. “Am I prepared to face that? If worst comes to worst, is this really going to break me down as a person?”
Perhaps, as Hollis suggests, it’s not just about asking if the industry can do a better job at recruiting employees of color, but also if it’s worth the time and effort for Black people to consider such roles at all. To foster greater equity among staff—and potentially create more welcoming atmospheres for customers of color—Hollis says that Black people should take direct steps to ask if they’re supported as people and professionals, like asking breweries if they have plans for diversity and equity already in place.
“I wouldn’t wait until you’ve already invested your time and energy into a place, and then having those conversations, and having to cut ties after you already built those relationships,” she says. “Be upfront with yourself and your employer about what effects real-life diversity, inclusion, and equity have on you as an individual, and what they’ve been doing to address it internally and externally.”
It can be helpful, Hollis says, to have DE&I personnel working at craft breweries. That’s not only because situations might arise that would warrant a professional but also because she’s seen that role be unofficially assigned to minorities working at breweries.
“There’s a weight of doing the work of a diversity and inclusion person, when that’s not your job and you haven’t been trained for it, that kinda comes with being a Black person in beer right now.”
Hollis believes more hiring of non-white employees will benefit businesses and their culture. But she is not optimistic that breweries will make these changes without being forced—which typically happens only after a failure in equity or other mistake becomes public.
“I just don’t know that the care is really there when folks are not beating down their doors,” she says.
As Hollis says, it often takes a public relations crisis for a company to institute change. To be effective, the change has to be embraced at every level of the company. Founders’ critics have said its owners still haven’t grasped that.
When asked what role Founders’ leadership plays in the new diversity, equity, and inclusion efforts—and whether the C-suite recognizes the importance of this work—Stevenson says executives in the company have been “personally involved.”
But he stops short of apologizing for mistakes leadership is alleged to have made in the past, saying he’s “legally bound” to refrain from commenting on Evans’ lawsuit. He acknowledges, without citing specifics, that “people inside [Founders] were hurt,” but follows that with a contradictory claim that the company has been a welcoming place for employees and customers.
“What I would say to critics is: Come on in. Talk to us. Anyone can have an opinion, that’s fair. But if you have an informed opinion, I’m going to respect you a lot more and I’d love to talk to you about it,” he says. “In other words, I know what we’re up to; I know why we’re doing it; I know what we’re getting from it; and I’d love to share it with anybody and everybody.”
Yet it’s not clear where or how critics are supposed to share their opinions. In the easiest forum—social media—Founders has not engaged with those expressing anger and disappointment toward the company. In one recent example, the company asked Twitter followers about the best trend in beer, and responded to nearly every tweet—except those that mentioned Founders’ past issues with race.
This mirrors similar behavior on the part of the Brewers Association (BA), the craft beer trade group, which has brushed aside social media criticism of its handling of race and racism in the industry. April Boyce, a vocal beer enthusiast and critic of the BA, has spent most of the past month trying to get the Brewers Association’s CEO Bob Pease to interact with her on Twitter, to no avail. Libby Crider, co-owner of St. Louis' 2nd Shift Brewing, publicly announced she wouldn’t renew the company’s BA membership because of a lack of transparency and communication from the BA and Pease.
To Evans, Founders’ response should do the opposite of the BA’s: the brewery should publicly strive to better understand these issues, and ensure those experiencing them no longer feel ignored. He believes Founders’ leaders are like many other white entrepreneurs running businesses that employ a small number of Black people. As he sees it, those owners never got close enough to people of color to understand the challenges they face, nor learn how they can bring about change.
Part of this might be explained by Founders’ Grand Rapids headquarters. That city is the largest Dutch settlement area in the United States, and West Michigan region’s culture is shaped by this history of white European settlement. According to the most recent census data, Grand Rapids’ population is 40% non-white, on par with national averages, but its culture has been shaped by its history of European settlement..
Harkema says Grand Rapids—and its brewing industry—remains sharply segregated. She credits her “background or insight or maybe even sponsorship from white male counterparts” as contributing to her ability to advance professionally in the city. Founders, like many breweries in the area, is led by mostly white men whom she says she had to make comfortable in order to have her voice heard.
She says the leadership team had trouble connecting with anyone—be they racial minorities or transgender individuals—from different backgrounds According to Harkema, Founders’ leadership had casual, cordial conversations with Black employees, or other minorities working in the taproom, but those interactions didn’t go deep enough to be considered a “relationship.” This echoes what White noted earlier: Some white employees have never had professional relationships with people of color.
“The whole team […] grew up in the same area; they went to high school in the same area; many of them went to college at the same university; now most of them reside all in the same area,” Harkema says. “Their circles are very limited. They didn’t exemplify opportunities to step outside of their comfort zones.”
When a largely white company from a largely white region opens a satellite taproom in Detroit—a city that is nearly 79% Black—tensions can build if it doesn’t understand or prioritize intentional DE&I work. (Founders says 20% of its workforce is made up of people of color.)
“Their only intimate experience with a person of color is us—the one or two people. And they probably didn’t get that until college,” Evans says. “They spend most of their lives not having an experience with a person of color, and they end up in charge.”
Founders’ leadership and some of its critics continue to be at an impasse over the question of an apology. Jackson-Beckham outlines the “four As” of crisis communication: acknowledgment, apology, action, atonement. In that framework, a group responds to a crisis by moving through those four chronologically. Skipping steps jeopardizes the success of the entire effort.Without the first two steps—acknowledgment and apology—it’s not clear if its customers and consumers will accept Founders moving directly to the action phase, which it plans to do.
In November, The Fifty/50 Restaurant Group, a Chicago hospitality company that comprises a number of popular restaurants and bars, stopped carrying Founders beer. It donated proceeds from a tap takeover to the Polished Pebbles Girls Mentoring Program. (At the time, four of the group’s top-five highest-volume beer establishments had permanent Founders tap handles.) In a conversation with GBH, co-owner Greg Mohr said the leaked deposition in Evans’ racial discrimination lawsuit and subsequent comments from Founders made it clear there was a pervasive problem within the brewery.
The brewery’s new diversity, equity, and inclusion plan hasn’t changed his position.
“On paper, it looks like Founders' plan is extensive and well thought-out, but it's obviously up to them to execute it fully. And we hope they do just that for the betterment of their employees and their company culture,” he says, adding that the Fifty/50 Restaurant Group still won’t carry Founders products. “We want to focus on supporting Midwestern breweries—particularly those in Chicago where we’re based—that haven't had the issues that Founders had in the past. We've simply moved on.”
It’s not as simple for others as they wait for clarity from Founders. Harry Weaver and Wayne Phillips were among the first to report on the Evans-Founders lawsuit in 2019 as part of their Brewz Brothaz podcast. The story was of particular interest to them as Black men, while Weaver is also an experienced diversity and inclusion professional who spent seven years as education director at the Anti-Defamation League of Greater Detroit. He sees the sentiment from today’s Black consumers as somewhere between indignation and indifference toward companies that make excuses instead of changes.
“Quite honestly, between Wayne and I, and some other Black beer drinkers in the [Detroit] area, we spent a lot of money with these guys,” Weaver says. “And we feel entitled to ask for answers.”
Weaver says Founders initially responded to emails from him and Phillips, but the company's answers lacked substance, telling GBH that the most he was told was that the brewery was handling it in-house.
After the deposition was made public, Weaver and Phillips had lunch with Founders co-founder Dave Engbers, who Weaver says asked to be on a Brewz Brothaz podcast. After the interview was set for October 2019, Engbers backed out.
“I have not heard a word from Dave or anybody from Founders since,” Weaver says. “Not a, ‘Hey, we can’t talk about it because it’s part of the litigation; thanks for being willing to invite us on’—nothing.”
Weaver says he told Founders in 2019 that the company’s failure to address problems of race was leading people to swear off its beers. He says he’s among about 1,100 people in a private Facebook group focused on Black beer drinkers who have pledged not to buy products from the brewery.
“I get that it's a minuscule portion of your customer base, but what I'm here to tell you that that number is going to swell, because at some point there are going to be allies, and more people are going to hear about this story,” he says. “Some people are saying there's too much good beer out here to be drinking beer from people who behave this way.”
Clearly, Founders’ critics are no monolith. Some are still pressing for an apology. Some have grown weary and written the brewery off entirely. Some, as Michigan State University economist Charley Ballard described to East Lansing, Michigan’s WKAR, will eventually return as customers.
“I have a feeling that eventually this campaign will sort of lose some steam and one by one people will say, ‘Well, Founders has done enough,’” Ballard explained in December 2019.
But feelings of fatigue or acceptance don’t render the question of Founders’ reputation moot. They’re vital for the beer industry to take note of, because Founders serves as the industry’s highest-profile example of a brewery reckoning with allegations of racism. As drinkers and brewers call out bad behavior, the industry needs to have an idea of what response it’s demanding, and what behavior it expects on the other side of that call out. The Founders situation will indicate not just what critics want to see and hear from breweries, but how long they’re willing to wait for it.
Cultural change within any body—a government, an organization, a company—doesn’t happen overnight. Founders’ diversity, equity, and inclusion process is designed to take five years to reach—then the process will repeat. That repetition is designed to create constant progress and improvement toward the company’s goals. Once short- and long-term goals are met, they’re replaced with new ones.
“Our goal with DE&I was to have a process rather than it just being an educational focus. We want to make sure it’s part of everything we do,” says Dave Goldstein, Founders’ regional sales director for the East Region, and the chair of the DAC’s board of directors. “We’re not looking to say ‘mission accomplished’ because we wrote a plan.”
The type of quantifiable change a DE&I plan is intended to foster takes time, Jackson-Beckham says. It’s taken almost a year for Founders to issue benchmarking surveys, form committees, set goals, and establish new relationships with partner organizations. She likens the scale and timeline of DE&I efforts to those of large-scale sustainability initiatives.
“No one would expect anybody to figure out how to reengineer their business into a sustainable business overnight,” she says. “Nor does anyone think you can just change out all your lightbulbs and you’re green now.”
But how long are certain drinkers willing to give Founders to, in essence, get it right? Sales numbers indicate no significant backlash to the company—so perhaps there’s no imperative for the brewery to speed up this process. Evans filed his lawsuit against Founders almost exactly two years ago, and the brewery has only grown in size and sales since then.
Evans continues to monitor Founders from a distance. He hasn’t shared with GBH what his current work focus is, but says it involves helping others speak out against workplace misconduct. His experience at Founders emphasized the importance of whistleblowers. He wants to motivate others to speak truth to power.
“All of these [non-disclosure] rules and laws are built to protect companies,” he says. “I won't get into all the things companies do to hide the things they’ve done, whether settlements or non-disclosures. We know that happens.”
In the meantime, Evans says he’ll keep paying attention to Founders’ words and actions. He’s planning a podcast to provide a safe space for those who’ve dealt with workplace discrimination to tell their stories, like Brewz Brothaz did for him.
“Sometimes people just block out a lot of those things and never actually speak up about them because they're scared that no one's going to believe them, or there's no path for them,” Evans says. “We tend to just go on about our days and do what we need to do in order to survive, especially in times like these. People are living paycheck-to-paycheck, if they even have that. So if they have a job, why would they want to risk anything stirring up the pot?”
One of the most common adages about beer is that it’s supposed to be a great equalizer. Craft breweries and brewpubs are heralded as boons to communities and signs of reinvestment. Fewer people in the industry are willing to acknowledge they can also be low-cost gentrification land grabs. When a successful Grand Rapids beer company gets in trouble in Detroit—and as other breweries discover the economics of opening up in historically Black neighborhoods with depressed property values caused by disinvestment over time—the question of what community in beer means, and who’s really invited in, becomes all the more urgent.
Evans says the industry has become intoxicated with its own appearance of equality and good intentions. Some expect praise more for what they’re not doing wrong than for what they’re doing right.
“Just because you’re not hanging up nooses and putting up swastikas and Confederate flags—just because you hire a couple minorities—that does not mean that you are in the right or on the right path,” he says. “We’re not even close to where we walk into an industry and are seen as equal as a human.”
Like Hollis, Evans says the entire industry must be held accountable for treating people fairly, and Black craft beer workers must know their worth. The reason, he says, goes beyond the ceremonial high-fives and self-congratulation that breweries pour over themselves when they’ve achieved even the most minimal levels of minority representation.
“Surprising to a bunch of white folks, some Black people love craft beer. Holy shit, what a surprise,” Evans says with a laugh, before getting back to a serious tone. “Hold space for those types of people, and when they want to hold you accountable, don’t combat them.”
Words by Mike Jordan + Kate Bernot