The whole xenophobia thing was invented by Zahn, in my humble opinion. It is based on nothing. George Lucas was making a medium budget adventure show and the Nazi allegory of the Empire, along with their uniforms is hard to ignore, but really it was because they hired a bunch of white British actors to be extras, and fans have run with it, virtually making it canon, that the Empire hates aliens. This goes back 4000 years apparently because it is a staple of the Sith Empire in KOTOR and SWTOR.
Thats a poor excuse to dismiss the Empire's xenophobia. There were many humanoid aliens in A New Hope and Return of the Jedi. Yet, not once did we see a Sullustan or Rodian working for the Empire. The only alien roles we saw were them as mercs like Garindan and Bossk. Never ONCE did we see an alien officer, and it wouldn't have been difficult for them to do something like an officer with a rodian head considering the creatures we see in the cantina scene and all the work those required.
Edited by patrickmahan