“Mad Money” host Jim Cramer is not usually in awe of the top executives he interviews on his CNBC show.
But in a memorable interview with Elf CEO Tarang Amin in 2023, he did just that during a discussion of the key drivers of the company’s Q15 growth. (Elf has since achieved Q21.) After Amin outlined the product innovation and social media wins that fueled Elf’s resonance, Cramer asked how the company manages to stay so close to its consumers.
More from WWD
“We have a talent because we have a great workforce that knows our consumers,” Amin replied, detailing Elf’s internal demographics: more than 65% Gen Z and Millennials, more than 75% women, and a workforce that is more than 40% diverse. Not to mention a board of directors that is two-thirds women and one-third minority, the only one in 4,200 in corporate America.
“I’m going to take a break from my form for a second,” Cramer replied, putting aside his script.
“It’s no coincidence that you’re where you are, with the people you have.”
Amin couldn’t agree more. The soft-spoken CEO is a passionate believer that Elf’s huge success is due to its internal culture of equality and diversity.
“I actually started my career in beauty years ago, as part of the team that relaunched Pantene in the early ’90s. I love beauty,” she said. “I love the passion for ideas, the passion for innovation. But one of the things I didn’t love about beauty was that it sometimes felt exclusionary.”
In fact, one of the earliest goals he set for himself when he became CEO in 2014 was to diversify the company’s workforce. “My first goal was to want our team to reflect the community we serve, so that’s why we’re so diverse,” Amin said. “If you have a team that reflects your community, you can work much faster. You don’t have to go to a focus group to understand what they like, how they interact, or where they live.”
Amin is equally passionate about promoting diversity and inclusion not only at Elf but on Wall Street as well, and aims to double the rate of adding women and diverse members to corporate boards by 2027.
Elf launched its “Change the Board Game” initiative earlier this year by announcing a partnership with the National Association of Corporate Directors and sponsorship of 20 female and/or diverse board-ready candidates through NACD Accelerate. NACD Accelerate is a two-year program that creates a pathway for directors to prepare for board service.
In May, he highlighted that passion with a media campaign called “So Many Dicks” on digital screens surrounding Wall Street.
Working with purpose-driven organization Oberland, Elf conducted a study of corporate boards in the U.S. and learned that men named Richard, Rick or Dick (Dicks) outnumber women and diverse groups on these public company boards.
“We don’t want to be just one of the four and we feel that as good corporate citizens, we have a responsibility to encourage others,” Amin said of the campaign.
“It all starts with intention,” added Mandy Fields, Elf’s chief financial officer. “Having more women on our board was very intentional, because that’s the community we serve, to make sure we had diverse candidates as part of our board selection. Just setting that intention helps things move forward. Without an intention, a goal, or something to tie back to, you’re just floating around out there.”
Not every company might be willing to put themselves out there with such a bold campaign, but what better way to get Wall Street to advocate for diversity and inclusion more effectively, according to Fields?
“I actually got a lot of compliments on the ‘Change the Board Game’ campaign. It was a unique way for Elf to break through,” he said. “Diverse groups, diverse management teams, boards of directors, they produce better results than other companies. No one can argue with our 21 quarters of growth, we’re doing the right thing at Elf.”
The key to ensuring this mindset extends to the rest of the organization is that the employee base reflects the consumers it serves, said Scott Milsten, senior vice president, general counsel and chief human resources officer at Elf Beauty.
“We’re starting from a common ground, which is a beauty company, a young beauty company,” she said. “It naturally attracts like-minded people.”
He said Elf doesn’t have a quota, but the hiring team is always careful to present a diverse range of candidates.
Amin also created an environment where everyone had the freedom to give specific feedback in the spirit of helping the team succeed, eliminating the need for performance reviews. “Nobody has to wonder what I think. I’ll tell you,” he said. “I want to make sure that everybody feels comfortable expressing themselves… I didn’t want the crutch of performance reviews. I wanted to take that away. Sometimes the reviews were based on who was getting paid more, who was getting paid less. For me, it was like, no, we’re all together. I want everybody to really make a lot of money. I want everybody to rise and fall together.”
Amin didn’t just support the idea for the sake of it. He turned his words into action, creating a compensation program that literally gives equality to every employee, regardless of where they are or what level they are at.
“I said on day one that I wanted every single person working in the company, not just the people at the top, to benefit from long-term value creation,” Amin said.
This included all global markets having to create something called phantom capital before the company went public, which was no easy task.
“We have a real belief that big performance should pay big dividends for everyone, and we’re very pleased that it’s happening,” Milsten said. “It makes your work so much more effective. I used to shudder to think about walking into a room and watching a stock price go up and six people are celebrating and 27 people don’t know what we’re shaking hands for. It doesn’t work for me on a personal level. It doesn’t work for Tarang on a personal level, so we decided to do it really differently.”
To engage with his staff, Amin sends out a weekly company memo email that began during the pandemic (his 227th email had been published by press time) and then hosts an afternoon event at Amin’s.
Every summer, he invites everyone on his leadership team and their significant others from all over the world to his house for cocktails and dinners—two in California, where the company is headquartered, and one in New York.
“We’re flying people in from London to have cocktails at Tarang’s house. One team, one dream, right? There’s no ‘Oh, US leaders are important, UK leaders are not,'” Milsten said.
Marcus Collins, a former Wieden + Kennedy executive and marketing professor at the University of Michigan, saw this dynamic firsthand. When he was invited to speak at an Elf event in Cabo San Lucas, Mexico, he struck up a conversation with a friend at the dinner table. It turned out that he had joined the company about two months ago and was the office coordinator.
Surprised that even a relatively new hire would be invited on a company trip to an exotic location, Collins mentioned the encounter during a tech check-in with Amin and several other executives the next morning.
“‘You’ve met Rosie!’” Amin recalled telling him, surprised that the CEO even knew her name.
“I’ve never seen a CEO, CMO, CPO recognize people lower down in the organization’s social hierarchy,” said Collins, who has worked with Nike, Google, Apple and others throughout his career. “The idea of focusing on people and democratization is real,” he continued, noting with a laugh that one of his most popular sessions outside is on EBITDA. [earnings before interest, taxes, depreciation and amortization].
“It’s not normal for everyone to have stock. It’s a democratizing aspect,” Collins said. “Beauty is a means through which Elf manifests itself in the world, but they are driven by something much larger, and that is tangible and manifested through their cultural practices.”
The best of WWD