“Diversity, Equity & Inclusion in the Cannabis Industry,” the latest report from MJBizDaily, sheds light on the ever-evolving landscape of diversity within the cannabis sector. According to Andrew Long, data analyst and author of the report, “Understanding how these groups respond to change is one of the reasons MJBizDaily continues to survey the industry on diversity trends.”
Recovering Diversity: About The Report
The report presents a heartening trend, indicating a return to pre-pandemic levels of diversity in executive positions within the cannabis industry’s C-suite. In 2019, MJBizDaily revealed that more than 36% of marijuana executives were women, with 28% from minority communities.
However, 2020 marked by COVID-19 disruptions saw a significant drop in these figures, with women accounting for a mere 22% in executive positions and individuals from minority groups representing only 13%.
Diving Into Multifaceted Reasons For Renewed Diversity In Cannabis Leadership And Ownership
The reasons behind these shifts in leadership and ownership are complex and multifaceted. While identifying the exact causes proves challenging, several factors could contribute to the resurgence of diversity in the industry’s upper echelons.
One plausible explanation lies in the post-pandemic return to normalcy. The upheaval of 2020 with its economic disruptions and uncertainty may have prompted some individuals, especially women and minorities, to temporarily leave the industry. As the cannabis sector stabilizes, there’s a likelihood that these individuals are now re-entering leadership roles.
“There have been studies showing that the pandemic impacted women and minorities differently than white men. So, it could be as simple as those individuals have recovered and are returning to the workplace,” Long told Benzinga. “On the other hand, could the recent disruptions in the industry have created opportunities for women and minorities as people left the industry? It’s hard to say without asking that direct question of those affected.”
The dynamic nature of the cannabis industry also plays a pivotal role in these fluctuations. Long noted, “With better data, we can then distinguish between human preference and other factors that are preventing minorities from leadership positions and ownership within the different parts of the industry.”
Cannabis Ownership Shift
The report also delves into ownership of cannabis businesses. While nonwhite ownership of these companies increased to nearly 19% in 2023 from 15% in 2022, the data points to a concerning decline in women’s ownership. The report indicates that women’s ownership of cannabis businesses fell to 16% this year, down from an average of 21% over the past two years.
These statistics raise questions about the evolving nature of ownership in the cannabis industry. Are early entrants leaving and being replaced by a new and distinct group of owners? Are there enough new opportunities for women and minorities to establish themselves as owners?
Long emphasizes the significance of data collection. “More states should be monitoring and providing demographics on ownership and employment in the cannabis industry – especially those with social equity programs. Understanding the nature of the problem is the best way to fix it.”
State-Level Variations In Cannabis Ownership Demographics
The report highlights state-level variations in demographic data.
- In Colorado, for instance, data on marijuana businesses is more accessible. As of July, 18.8% of cannabis license owners in Colorado identified as nonwhite, marking a substantial increase since the state began tracking this data. However, the report points out a disparity between employees and owners, with the majority of cannabis business owners being white.
- In New Mexico, women account for 29.5% of cannabis business owners, and members of minority groups make up about 24% of ownership. These figures may seem relatively high compared to other states, partly because of how the state counts ownership. New Mexico includes anyone with at least a 10% ownership stake in a marijuana business license, while other states only count majority owners.
- Nevada employs a unique method, counting management within its ownership numbers. In 2023, women represented nearly 28% of ownership/management positions in Nevada, while racial minorities were close to 24%, according to the report.
As the industry continues to evolve, understanding the dynamics of diversity within it is essential for addressing disparities and fostering a more inclusive future.
Read the full MJBizDaily report here
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