Huge Gaps in Diversity of Business Leadership – A Systemic Issue Needing a Systemic Approach, Part 1

Many people in the industry continue to state that our corporate leadership is getting more and more diverse, touting the increase in women, people of color and LGBTQ people reaching the highest echelons of business leadership. In addition to these optimistic statements being heard nationwide, they are frequently spread across my local area of Raleigh – Durham – Chapel Hill, North Carolina, often called the Triangle. We are a leading center for the high tech, health care, pharmaceutical and education industries.

So I was in for a shock when I received my November 22, 2019 Triangle Business Journal. This issue featured the 50 fastest growing privately-held companies in the Triangle with brief descriptions and photos of the CEOs. As I went through the first several, I noticed how all the photos starting looking similar; and then I decided to count them. These 50 fastest growing companies are led by 44 white men, 3 white women, 2 Asian men and 1 black woman. What extraordinary optics! I immediately reached out to share this with an area consultant I often collaborate with, Al Sullivan of Inspirus Consulting, to discuss these numbers.

Even as I was drafting this blog in mid-December, a New York Times article by Lauretta Charlton titled “Few blacks to be found at the top of the corporate ladder,” (link) also appeared in our Raleigh News and Observer. She reported that there are only four black CEOs of Fortune 500 companies (that’s less than 1%,) down from 7 less than a decade ago.

One recent report by the leading consulting company McKinsey & Company (link to the study) completed an extensive study across 222 companies employing more than 12 million people. Some of their findings include:

• Women remain significantly underrepresented in the corporate pipeline from the outset. Even though women represent 57% of college graduates, fewer women than men are hired at the entry level.

• White men are in 36% of the entry level roles. That increases to 47% of management, 61% of vice presidents and 67% of the C-Suite.

• Men of color are somewhat underrepresented compared to white men, 16% of entry roles, 16% of management, 11% of vice presidents and 12% of C-Suite.

• White women fare worse; 31% of entry roles, 26% of management, 23% of VPs and 18% of C-Suite.

• And women of color are far under-represented in leadership roles, declining from 17% of entry roles down to 11% of management, 6% of VPs and only 3% in the C-suite.

Is this what the C-Suite is supposed to look like in today’s world? (Photo in the public domain)

Another way of looking at the data is a percentage under-represented or over-represented they are in senior leadership compared to entry level jobs.

All things being equal (and we know they are not), the ideal fair state would be each particular demographic being the same percentage of the workforce across all levels from entry level to vice president to c-suite.  Looking at the data this way:

  • White men are over-represented in VP and c-suite roles by 91%
  • Men of color are under-represented in VP and c-suite roles by 38%
  • White women are under-represented in VP and c-suite roles by 42%
  • And women of color are under-represented in VP and c-suite roles by 77%!

Clearly we are not moving along in the area of diversity in career progression as we should. Why might this be happening, and systemically, what can be done?

And now  here is part 2:  Five Tactics to Address the Systemic Issue of the Lack of Diverse Business Leaders.

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Blog author Stan Kimer is a diversity consultant and trainer who handles all areas of workplace diversity and with a deep expertise in LGBT diversity strategy and training. Please explore the rest of my website and never hesitate to contact me to discuss diversity training for your organization, or pass my name onto your HR department.  [email protected]