BLACK REPRESENTATION AT THE C-LEVEL: WHERE DOES THE CORPORATE WORLD STAND IN 2022?

Nearly two years ago, in May 2020, following the brutal murder of George Floyd and the ensuing global uprising by the Black Lives Matter movement, many businesses had a real wake-up call. Facing enormous pressure from society, large corporations announced unprecedented programs to support the black community, inside the US as well as globally, and committed to spending a total of US $66 billion on racial equity programs.

Increasing black representation at all levels of large corporations was one of the main promises global companies made back then, in addition to supporting black-owned businesses and educational programs for the black community.

According to a “Being Black in Corporate America” survey carried out that same year, black professionals held only 0.8% of CEO positions among Fortune 500 companies, and just 3.2% of senior leadership positions. Indeed, the black population represented 10% of college degree holders while constituting 14% of the total population of the US.

Since then, many companies have shown significant progress in increasing black representation. According to Spencer Stuart’s 2021 S&P 500 Board Diversity Snapshot, 33% of new independent directors were black, three times more than the year before—and the most since Stuart began tracking this data in 2008.

Another study, by ISS Corporate Solutions, also showed that the percentage of Black and African American directors had gone from 4.5% to 7.4% of directorships held in the Russell 3000 over 2019–2021.

However, even these increases are not sufficient for the black representation gap to be eliminated. All this growth has not yet generated a fair black representation in leadership positions, which remains significantly lower than that at the entry, junior and middle levels.

If we look beyond the US, the stats tend to be even more disappointing. In the UK, where blacks constitute only 3% of the total population, the percentage of black executive directors and non-executive directors at FTSE-100 firms—including board and executive committee level positions—slipped from 1.3% in 2014 to 1.1% in 2021, according to UK-based Green Park Consultancy.

The differences between black representation on the junior and entry levels and that on the senior level prove that there is no lack of talent in the pipeline. These differences can rather be explained by the lack of adequate internal policies and an insufficiently inclusive culture at the corporations themselves.

On the other hand, following George Floyd’s death, the United States saw a sharp increase in the registration of black-owned businesses, nearly 50% by the end of 2020, according to MerchantMaverick’s Report: Best States for Black Entrepreneurs in 2022. Stimulated by large support programs at global corporations, this dramatic jump could also be partly explained by not very favorable conditions for professional growth that corporate career ladders provide for ambitious black professionals, who seem to be rather choosing a journey on their own terms than playing by the biased rules of corporations.

What more can be done to achieve fair black representation?

Bias-killing policies. Change hiring and promotion policies to provide a clear and transparent advantage to underrepresented groups. In a recent article I discuss how companies can use apply procurement practices to hiring for better diversity without discriminating against disadvantaged groups or professionals from dominating groups.

The key point here is that no hiring or promotion decision, be it on a junior or a senior level, should be made by a single individual. Moreover, such decisions should be governed by clear procedures with scores and transparent multilateral evaluation protocols. Their results should directly affect hiring and promotion decisions with no additional senior level approval.

To put it simply, hiring and promotion policies should not allow executives to apply their biases. Of course, elaborating clear criteria for each position is likely to take time and effort. But once they have been done, they will take a major headache away from HR officers and senior executives, as well as saving plenty of time in the long run. Moreover, a transparent methodology is impossible to accuse for biases, as opposed to an individual decision.

Improving corporate culture. There are many definitions of corporate culture. To my mind, the best one is: culture is the way senior leaders and company owners behave. The genuine behavior of senior leaders and owners has a tremendous trickle-down effect on any organization. Showing respect for the opinions of people around you, regardless of their skin color, can very quickly lead to a culture shift that makes rapid career growth among people of color, including black professionals, possible.

At the Annual Meeting of the Global Inclusion Online Forum in May 2022, we plan to discuss the current level of representation in the black and ethnic minority communities in top management, among other issues, in a panel featuring global heads of diversity and inclusion from Under Armor, Mastercard and Kraft Heinz.

The percentage of black senior leaders is not so much a goal, as an indicator of what is going on in attitudes towards black professionals. Despite some real progress in this direction over the last two years, a big shift is yet to happen.