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The Phenomenon Behind the Lack of Black CEOs at Fortune 500 Companies



According to the U.S. Census, 13 percent of the U.S. population is African-American. But according to Daily Finance, there are only five African-American CEOs of Fortune 500 companies— Ursula M. Burns of Xerox, Kenneth C. Frazier of Merck, Roger W. Ferguson Jr. of TIAA-CREF, Kenneth I. Chenault of American Express, and John W. Thompson of Virtual Instruments.

There has always been discussion surrounding diversity in the workforce. The tech industry was catapulted to the forefront when Facebook released their Equal Employment Opportunity (EEO) report months ago. Many analysts reported that there was still a small percentage of African-Americas employees, and made suggestions for what Facebook could do to improve those statistics. However, little was mentioned about the lack of leadership in the company. There are only three African-Americans (two men and one woman) in executive level positions.

In her Ted Talk last year, Mellody Hobson, Ariel Investments president and chairman of the board of directors of Dreamworks Animation, focused on the lack of diversity in leadership roles. She mentioned that while white men make up 30 percent of the U.S. population, they hold 70 percent of all corporate board seats. She also pointed out  that out of thousands of publicly traded companies, only two are chaired by Black women—and she was one of them.

“Our numbers are going south on us,” said Ronald Parker, CEO of The Executive Leadership Council told CNN Money. “Corporate boards, too, lack racial diversity and are overwhelmingly white. That needs to change, too, and boards need to be very, very intentional and methodical in succession planning.”

The Executive Leadership Council is an organization that aims to increase the number of successful Black executives worldwide by adding value to their development, leadership, and philanthropic endeavors throughout the life-cycle of their careers thereby strengthening their companies, organizations, and communities.

“They need to make sure that there are individuals (in the pipeline) who are getting the proper career experiences that will allow them to have the global perspective to lead multinational companies,” Parker told CNN Money.

Another organization, Sponsors for Educational Opportunity provides superior educational and career programs to young people from underserved and underrepresented communities to maximize their opportunities for college and career success. With initiatives and programs aimed to combat this ongoing issue, why does the disparity continue to exist?

The white paper, Uncovering Talent: A New Model of Inclusion written by Christie Smith of Deloitte Consulting and Kenji Yoshino, a NYU Law professor, examines inclusion.

“Clearly the needle has not moved with regard to the representation of women and minorities in the senior ranks,” Smith told Forbes. “The initiatives that companies have spent millions on are, at some level, not allowing women or minorities to break the glass ceiling into the executive suite, so we wanted to step back and answer the question ‘what’s going on here’?”

The report suggests the phenomenon of “covering,” a term coined by sociologist Erving Goffman to describe how individuals downplay aspects of one’s identity. An example would be an African-American person who hesitates to associate with his or her African-American colleagues.

“In some ways, ‘covering’ is a good problem to have,” Yoshino tells Forbes. “It’s a ‘second-generation issue’ that has arisen now that more overt forms of discrimination have been banned and (in theory) stamped out of corporate life. But it’s also left an insidious legacy. Many people point to the fact that formal forms of discrimination have been retired, and they wipe their hands and say, ‘we’re done with diversity.’”

Smith mentions to Forbes that many organizations have a stated policy of including racial minorities, but remain passive in the face a culture in which Black women, for example, feel they must straighten their hair or can’t associate with each other.

“We hope the ‘uncovering talent’ model gives leaders the tools to take a closer look at whether they’re living their values,” Smith said.

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