Estée Lauder said on Monday that it had asked John Demsey, a top executive at the beauty giant, to leave the company after he posted a meme containing a racial slur on his Instagram account.
“This decision is the result of his recent Instagram posts, which do not reflect the values of The Estée Lauder Companies, have caused widespread offense, are damaging to our efforts to drive inclusivity both inside and outside our walls, and do not reflect the judgment we expect of our leaders,” the company said in a staff memo, which was posted to its investor relations site.
A spokeswoman for the company said Mr. Demsey had not been fired but had been told that he had to leave the company. He agreed to retire effective Friday, according to a regulatory filing on Monday.
The executive’s racist post this month unleashed a firestorm in the beauty industry, where Mr. Demsey, 65, was a powerful figure, and where Estée Lauder has been under scrutiny for its diversity efforts. Mr. Demsey, an executive vice president at the company, oversaw a portfolio of major cosmetics brands that brought in billions of dollars in sales, including MAC, Clinique, Too Faced and Smashbox. He has tens of thousands of followers on Instagram, where he regularly posts memes along with beauty-related content.
Estée Lauder said in a filing on Thursday that Mr. Demsey had been placed on unpaid leave. Over the weekend, he posted an apology on Instagram, saying he was “terribly sorry and deeply ashamed that I hurt so many people when I made the horrible mistake of carelessly reposting a racist meme without reading it beforehand.” He added that it “undermined everything I have been working for since I began my career 31 years ago.”
Employees at Estée Lauder took the company to task in 2020 during the wave of calls for racial justice after the killing of George Floyd. At the time, employees criticized the political donations made to former President Donald J. Trump by Ronald S. Lauder, a board member and son of the company’s founders, and they said they were at odds with the company’s stance on race.
The company and Mr. Lauder promised to fight for racial justice, and Estée Lauder said it would donate $5 million to “support racial and social justice and to continue to support greater access to education” and donate an additional $5 million over the next two years.
Mr. Demsey was among the highest-paid executives at Estée Lauder, where his total compensation was valued at $9.6 million in 2021, according to a regulatory filing. Forcing Mr. Demsey into retirement, rather than firing him, may affect his stock awards and other compensation, according to the filing.