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Report: Nevada cannabis industry executives remain mostly white and male

Sean Golonka
Sean Golonka
Marijuana
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Group of pedestrians outside Essence Cannabis Dispensary

Marijuana industry executives remain disproportionately white and male, as the racial diversity of business owners and board members changed little over the past year, according to an annual demographic report of the state’s cannabis industry.

Tyler Klimas, executive director of the Cannabis Compliance Board (the state regulatory body over cannabis), said he wasn’t surprised by the demographic breakdown in the report, which largely mirrored the demographics reported last year. Even small changes between the reports, such as the share of female owners and managers increasing or the percentage of Hispanic or Latino employees declining, could be explained by differences in the samples received and may not indicate changes in the entire industry workforce. 

Klimas said he expects the start of a new licensing process for cannabis consumption lounges later this year will help diversify the industry.

“We haven't really had any new mechanisms to increase the diversity in the cannabis industry, but these annual studies — they provide everyone with a reminder that we have this collective responsibility to work towards a more inclusive industry,” Klimas said in an interview.

Approval of cannabis consumption lounges during the 2021 legislative session came by way of AB341, which requires at least 10 of the first 20 independent lounge licenses to be issued to social equity applicants who have been disproportionately affected by previous marijuana criminalization policies.

“Consumption lounges in itself is not going to be a silver bullet to completely solve the issue of a lack of diversity in the industry, but it's going to be a great start,” Klimas said.

This year’s report, conducted pursuant to CCB regulations required by AB533 from the 2019 legislative session, found that 69 percent of license owners, managers, board members and officers identified as male, while 61 percent of that group identified as white — only small differences from the previous demographic survey. In 2021, 73 percent of that executive group identified as male and 63 percent identified as white.

The U.S. Census Bureau estimates that about half of all Nevadans are women, and that 48 percent of Nevadans are white alone, and not Hispanic or Latino. More than 29 percent of Nevadans are of Hispanic or Latino origin, according to the bureau, a significantly greater percentage than the 13 percent of owners, managers, board members and officers who identified as being of Hispanic, Latino or Spanish origin.

During a cannabis-focused discussion Thursday hosted by progressive advocacy organization Battle Born Progress, panelists described the cannabis industry as having a greater responsibility than other industries to bring about social equity and diversity, considering the way that previous prohibitions on marijuana disproportionately harmed communities of color. 

“The cannabis industry is a multibillion-dollar industry. It’s going to create a huge opportunity to help folks build generational wealth,” said Asia Duncan, co-founder of the Cannabis Equity and Inclusion Coalition. “Those disenfranchised by the War on Drugs, or the folks who were arrested, who are still in jail, who are suffering, whose family’s suffering … we're making sure that … folks like us are sitting at the table while we're creating policy and legislation.”

Industry employees, a group that excludes executives, managers and consultants, made up the bulk of responses to the survey and represented a significantly more racially diverse group than owners and board members.

More than 41 percent of employees identified themselves as female, a percentage that was approximately the same as the last survey. The report also found that 13 percent of employees identified as Black or African American, and 6 percent identified as Asian — upticks compared with owners and managers (5 percent each) and closer to the bureau’s estimates of the state’s population demographics that about 10 percent of Nevadans are Black or African American alone, and 9 percent are Asian alone.

The results came from a survey sent to nearly 16,000 active agent registration card holders in Nevada, a group that includes employees, contractors, owners, officers and board members of cannabis businesses, including cultivation and production facilities, testing laboratories and dispensaries. 

Though the board received more responses this year (6,690 responses) than it did in its previous demographic survey conducted in 2021 (5,501 responses), the response rate among card holders industry-wide dropped significantly from 56 percent to 42 percent. The response rate among industry executives also declined, falling from nearly 100 percent to 70 percent.

Klimas hopes to improve the response rate by including the demographic survey as part of the registration process for cannabis agent cards, which holders must reapply for every two years. Still, with two years of results, the surveys have provided a clear picture of the industry’s demographics.

“It's been fairly clear since we started what the makeup is,” Klimas said.

Beyond consumption lounges, Klimas also pointed to proposed regulations requiring applicants for any cannabis establishment license to submit a “diversity plan” including demographic information for all company executives and employees, strategies for obtaining a diverse group of owners, board members and employees and benchmarks for diversity goals, among other things.

Some companies are taking on diversity as a corporate goal. Angie Rodriguez-Smith, chief people officer at Thrive Cannabis Marketplace, said her company has helped train potential applicants on how to successfully enter the industry, while supporting efforts to roll out unconscious bias training and give preference to minority-owned companies in the bidding process.

She said members of her family have been affected by the War on Drugs, and she has mixed feelings about being a person of color in the executive meetings of a legal marijuana company.

“There's some pride with it. And then there's some sadness with it, because very often I have been the only one in that room,” she said at the panel. “These policies are the ones that have kept us out of it. And not necessarily because our lack of skills, or lack of effort, or lack of work ethic. It’s just they were set out to keep us out of these rooms, to keep us out of these discussions, to keep us out of these opportunities.”

The regulations for consumption lounges are also still in the public workshop process. The proposed guidelines for social equity applicants would require them to live in a census tract with an incarceration rate in the 90th percentile and a certain socioeconomic status (a measure mapped by Neighborhood Atlas, which factors in income, education, employment and housing quality in an area) and to have been convicted of a felony cannabis offense or have an immediate family member convicted of such an offense.

“Bringing in diverse ownership is going to have a trickle down effect, to hopefully the community members and the communities that have historically been at a disadvantage because of drug policy,” Klimas said.

Klimas said he expects that following the end of the regulatory process, the board could begin awarding licenses for consumption lounges by the fall, and that he expects some lounges will open this year.

“Over the next couple years, as we award those licenses, they'll get up and running, and then at that point, we'll start to see, hopefully, a catalyst for some change in the makeup of the industry,” he said.

Michelle Rindels contributed to this report.

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