EEO-1 Reporting in Cannabis: The Truth No One’s Talking About
January 24th, 2025
5 min read
By Clarke Lyons
Trump's DEI Rollback: A Wake-Up Call for the Cannabis Industry
In a sweeping move, President Donald Trump has signed executive orders dismantling diversity, equity, and inclusion (DEI) programs across federal agencies and contractors. This action includes revoking Executive Order 11246, which mandated affirmative action and prohibited employment discrimination by federal contractors. The administration argues that such DEI initiatives promote "preferential treatment" and deviate from merit-based hiring practices.
Implications for Cannabis Businesses
For the cannabis industry, which often prides itself on progressive values, this federal shift presents significant challenges. Companies with federal contracts or those seeking them must now navigate the elimination of DEI requirements, potentially impacting hiring practices and workplace culture. Moreover, the administration's directive for agencies to investigate private-sector DEI programs could lead to increased scrutiny of internal policies.
EEO-1 Reporting in Cannabis: The Truth No One’s Talking About
Here’s the deal: the cannabis industry loves to talk about being progressive, inclusive, and innovative. But when it comes to EEO-1 reporting—the federal mandate to disclose your workforce demographics—too many businesses are either ignoring it or doing the bare minimum. And that’s a problem.
Diversity is a Buzzword Until You Prove It
Because let’s be real: the cannabis industry is still grappling with systemic issues like lack of diversity, gender inequality, and unconscious bias. If you’re not using tools like EEO-1 reporting to get an honest look at your workforce, you’re not just avoiding compliance—you’re avoiding accountability.
The Mirror That Forces You to Confront the Truth
We’ll say it: for an industry that prides itself on breaking stigmas, cannabis has a diversity problem. Ownership skews heavily white and male, and many companies struggle to recruit or retain talent from underrepresented groups. That’s where EEO-1 reporting comes in. It’s not just another compliance headache—it’s a mirror. And it might reflect some uncomfortable truths about your hiring practices, promotion pathways, or lack of inclusivity. But avoiding that reflection doesn’t make the problem go away.
Small but Mighty: Why Small Cannabis Businesses Can’t Ignore EEO-1 Reporting
Think you’re too small to worry about this? Think again. Whether you’re running a dispensary or managing cultivation, here’s why you need to care:
- Diversity Isn’t Optional: Consumers and investors are demanding it. If your workforce doesn’t reflect your values, they’ll notice—and they’ll walk.
- Compliance Protects You: If you have 100+ employees (or 50+ as a federal contractor), you’re legally required to report your workforce data. Miss it, and you’re risking fines, lawsuits, or worse.
- Accountability Drives Growth: You can’t fix what you don’t measure. EEO-1 reporting exposes the gaps in your organization and gives you a roadmap to improve.
Friends and Family Hiring: The Shortcut That’s Stalling Your Growth
Let’s call out the elephant in the room: too many cannabis companies rely on the “friends and family” hiring model. Sure, it’s easy to onboard people you know, but it’s also a fast track to a homogenous workforce. And that’s not just bad optics—it’s bad business.
- Relying on personal networks limits your access to diverse talent pools.
- Homogeneity leads to groupthink, killing innovation and fresh ideas.
- Customers and investors are paying attention—lack of diversity is a red flag.
- Studies show that diverse leadership teams are more profitable and better at problem-solving.
- You’re leaving opportunities—and money—on the table by not diversifying your team.
The EEO-1 Advantage: Transforming Compliance Into a Growth Tool
This isn’t about pointing fingers; it’s about progress. Here’s how EEO-1 reporting can help you grow:
- Expose the Gaps: Get real about your workforce demographics—by race, gender, and role.
- Rethink Recruiting: Use the data to identify where you’re falling short and adjust your hiring strategies.
- Promote With Purpose: Ensure your leadership pipeline reflects the diversity you want to see at the top.
- Win Consumer Trust: Show that you’re not just selling cannabis—you’re living the values of equity and inclusion.
Why Consumers Care About Your Workforce
Consumers aren’t just buying cannabis—they’re buying into the values behind it. In an increasingly competitive market, showcasing a commitment to diversity and equity can set your business apart. Customers are looking at who you hire, how you treat them, and whether your values align with theirs.
A transparent approach to workforce reporting not only builds trust but also strengthens your brand. EEO-1 reporting is a powerful tool to communicate that trust. It tells your customers that you’re committed to more than just profit—you’re invested in creating a fair and equitable cannabis industry.
Retention and Recruitment: The Role of Diversity
Retention and recruitment are two of the biggest challenges in the cannabis industry. High turnover rates and stiff competition for top talent make it essential to differentiate yourself as an employer. Diversity isn’t just a nice-to-have—it’s a necessity for building strong, resilient teams.
By embracing EEO-1 reporting, you can identify gaps in your current workforce and create strategies to attract and retain a broader talent pool. When employees see that equity is a priority, they’re more likely to stay—and new hires are more likely to feel confident in your company’s values.
FAQs: Common EEO-1 Reporting Questions
What happens if I file my EEO-1 report late?
Filing late can result in penalties, increased scrutiny from the EEOC, and potential damage to your business’s reputation. It’s better to submit accurate data on time to avoid these risks.
Can small businesses benefit from EEO-1 reporting?
Yes! Even if you’re not required to file, tracking workforce demographics can provide valuable insights, improve your recruitment strategies, and demonstrate your commitment to equity and inclusion.
What tools can help simplify EEO-1 reporting?
Investing in HR software that includes workforce reporting capabilities can streamline the process, ensure accuracy, and reduce the administrative burden on your team.
Building a Legacy: Leading Through Equity
The cannabis industry has an opportunity to redefine leadership by prioritizing equity and inclusion. EEO-1 reporting isn’t just about meeting legal requirements—it’s about setting a new standard for how businesses should operate.
By taking an honest look at your workforce, addressing disparities, and fostering a culture of accountability, you’re not just creating a stronger business—you’re shaping the future of the industry. Leadership starts with action, and it’s time to step up.
The Future of Cannabis Leadership Starts With You
The cannabis industry has a unique opportunity to lead—not just in product innovation, but in workplace equity. Recognizing that compliance is just the beginning allows businesses to use EEO-1 reporting as a tool for driving meaningful growth. Companies that take the time to address disparities in their workplace aren’t just checking boxes; they’re setting themselves apart as trailblazers in the industry.
By committing to transparency and accountability, cannabis businesses can position themselves as leaders in diversity, equity, and inclusion. A diverse workforce doesn’t just improve internal culture—it’s a proven driver of profitability, innovation, and resilience. It demonstrates to your team, your consumers, and your investors that you’re serious about building an equitable future for the cannabis industry.
As federal DEI policies face rollbacks, the cannabis industry must decide: Will you use this moment to rise above and set new standards, or will you allow external pressures to undermine progress? Leadership starts with bold action. Use tools like EEO-1 reporting to assess where you stand, identify where you need to improve, and create a plan to lead with purpose.
The businesses that take this challenge seriously today will be the ones shaping the industry’s future tomorrow. Don’t wait for change to happen—be the change. Step up, take action, and show the world that the cannabis industry can be a model for inclusivity, equity, and growth. The time is now. Will you lead the way?
Resources to Take Action Today
- EEOC: EEO-1 Reporting Overview
- Department of Labor: Diversity & Inclusion Resources
- NCIA: Diversity, Equity, and Inclusion Resources
- SHRM: DEI Tools for Small Businesses
- Harvard Business Review: How Diversity Drives Innovation
Ready to embrace the future of cannabis leadership? Start today. Build transparency, foster equity, and make EEO-1 reporting the foundation of your business’s success story.
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