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Here's How Big Tech Companies Can End the Gender Pay Gap Recognizing the myth of the meritocracy is the first step toward ending the gender pay gap for women in tech.

By Debrah Lee Charatan Edited by Frances Dodds

Opinions expressed by Entrepreneur contributors are their own.

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Silicon Valley is known for its innovation, high-skilled talent and its meritocratic ethos -- that is, the focus on evaluating and rewarding employees based not on who they are, but on what they achieve. Big tech companies like Google and Uber famously promote company values that emphasize those ideas as a way of creating equality in the workplace.

When taken at face value, that all seems fair and good. However, reality captures a far different picture. Despite the tech sector's good intentions, companies with meritocratic principles still face a deep gender gap in their industry and continue to be criticized for their bias. For example, look no further than Google's memo fiasco or Susan Fowler's criticism of Uber's gender bias, management hubris and poor HR support.

How is it that top-tier tech companies can seemingly promote meritocratic ethics while their female employees fight against systemic barriers that prevent them from progressing up the ladder? Research from Massachusetts Institute of Technology (MIT) suggests that despite the values these companies claim to embody, meritocracy in big tech might not actually exist at all.

Meritocracy: the myth contributing to the gender pay gap

Unlike their male counterparts, women aren't facing an industry that judges them solely on their accomplishments. In actuality, the majority of women operate in organizations muddied with institutionalized biases. At least 42 percent of working women in the United States report that they've experienced some form of discrimination, including unconscious bias at work. While sexual harassment is a painful, very explicit form of unfair treatment, biases at work can be far more insidious than that.

Related: Why Leadership Is at the Crux of Closing the Gender Pay Gap

When it comes to diversity, Google still has work to do. It's latest diversity report shows that the number of women and unrepresented minorities barely budged in the past year. The company has faced gender-pay lawsuits. Similarly, Uber suffers from limited female staff and leadership and has also been hit with sexual harassment claims.

MIT research echoes these assumptions, citing how seemingly meritocratic organizations can unintentionally favor men over "equally performing women," offering them higher bonuses and more favorable career outcomes.

Authors Emilio Castilla and Stephen Bernard called this contradiction the "paradox of meritocracy." They argue that when progressive companies foster merit-based practices, they assume they're not biased regarding hiring, retention, compensation or promotion decisions. However, these processes don't protect against ingrained, demographic bias. For example, a merit-based system still doesn't stop managers from giving more favorable reviews to employees who are most like them.

"When managers believe their company is a meritocracy because formal evaluative and distributive mechanisms are in place, they are in fact more likely to exhibit the very biases that those systems seek to prevent," says Castilla for the MIT Sloan Management Review.

Tracy Chou, a tech engineer veteran who has worked at tech companies like Quora and Pinterest, has experienced this kind of bias and marginalization, despite being an expert in her field. Chou confronted biases ranging from everyday microaggressions to sexual harassment from her male coworkers, despite her authority. After hearing similar experiences from women in the tech industry, she started to realize that meritocracy in Silicon Valley is deeply flawed and didn't support equitable work environments that help women like her succeed.

"Meritocracy is this myth that, if you have merit, you will rise up and people who are in positions of power and success got there because they have the most merit and they most deserve it. Having a lot of markers and credentials that Silicon Valley generally like, I didn't quite question that either, when I first started working," Chou told Quartz.

Due to the prevailing biases which persist today, it's no surprise a truly meritocratic system ceases to thrive. But there may be some light at the end of the tunnel — and it begins with changing work cultures.

Tools and initiatives to help companies curb gender bias

Silicon Valley can incorporate truly meritocratic values, but it requires making a few small, meaningful adjustments to the current structure.

Castilla says, "Companies can develop into meritocracies by implementing merit-based evaluation and reward systems that have both accountability and transparency."

Related: These Are the U.S. States Where the Gender Pay Gap Is Widest

Clear processes that offer criteria for all employees at any career level can help companies ensure that skilled workers operate in a truly merit-based culture. These programs need to have individuals or groups of individuals that focus on the responsibility, ability and authority to ensure that these formal processes remain fair.

Google has taken a step to help resolve this issue. The tech giant now allows an employee's qualifications for a promotion to be based on peer recommendations rather than a manager's decision. These peers (along with all Google employees) are trained to spot and guard against unconscious biases so the review process remains fair. It's not perfect, but the practice is now the norm in many Silicon Valley tech companies, including Pinterest and Quora.

While Chou no longer works at either of these companies, she now uses her expertise to guard against bias, promote transparent data reporting on gender and reshape big tech's work cultures. In 2016, she established Project Include, a nonprofit that uses unbiased data programming and advocacy to help these tech giants bring on more diverse employees.

Uber has also managed to redefine its ethos from 14 core values, which ineffectively promoted meritocracy, to eight new cultural norms, which are expected to evolve as Uber grows. The company is still slow to implement more women in leadership and overall staff positions, but it is reinforcing its diversity and inclusion goals to offer an equal playing field for talent.

According to Uber's 2019 Diversity and Inclusion report, it's strengthening its hiring manager training program to create more inclusive interviewing skills through the Interview Moderator Initiative. The initiative helps ensure that tech interviews are free from subjective bias and stereotypes. Meanwhile, throughout their Career and Talent teams, they continue to review and redesign their systems and programs to help employees of all backgrounds thrive equally. This includes the creation of performance management and diversity scorecards.

Related: How to Fight the Gender Pay Gap as a Self-Employed Woman

However, biased work cultures will not change without internal awareness and analysis. The World Economic Forum advises companies to incorporate The Implicit Association Test. The free resource from Harvard University helps users gauge their personal biases around gender, race, age, weight, sexuality, tone and more. The tool offers insights into conflicts, addressing how employees think, their assumptions of social norms and how these biases inform our decision making on a daily basis. In all, these tools and initiatives can help make both the hiring and promotion processes more equal.

Reviving meritocracy with gender equality

While it's often assumed that meritocracy fosters gender equality, it seems to initially have had the opposite effect in companies who promote these principles. It's not that meritocracy is hurting women's careers, per se, but that companies with unconscious biases are using meritocratic principles in ways that are ineffective and problematic.

We have a long way to go until businesses reach a truly meritocratic model. It's time for companies to reexamine their diversity and inclusion goals and offer better support systems that help working women thrive. These companies can only become truly meritocratic workplaces by instilling gender equality policies and thus mindsets, at the core of their cultural value systems. Then, and only then, will we start to build a corporate ethos that is truly based on talent and hard work.

Debrah Lee Charatan

Real estate entrepreneur and philanthropist

Debrah Lee Charatan is a real estate veteran and philanthropist with nearly 40 years of industry experience. Charatan is the president of BCB Property Management Inc., a full-service multifamily and mixed-use real estate firm in New York City. 


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