It only takes a quick look at the Fortune 500 to see that there are still significant challenges for minority executives in business. Just three black CEOs lead these highly successful companies: Marvin Ellison (J.C. Penney), Roger Ferguson Jr. (TIAA) and Kenneth Frazier (Merck). Among the disheartening figures, according to Fortune:
- The number of black CEOs is down one from 2017, after Kenneth Chenault retired earlier this year from his longtime post as CEO of American Express.
- Three is the lowest number of black CEOs since 2002.
- Since 1999, a total of 16 black CEOs have led Fortune 500 companies.
- Ursula Burns was the first and only black woman CEO of a Fortune 500 company. She retired from Xerox in 2016.
“The fact that we’re in this situation is a real problem and embarrassing for corporate America,” Chenault said in November. He added that the leadership in these companies should identify and develop minority candidates: “You’ve got to put them in the pipeline … to identify, recruit, develop, and push people forward,” he said.
Here’s a look at some of the factors in these challenges for minority executives, and for those aiming to reach that level.
There’s no getting around these numbers. Consider again that not a single Fortune 500 company is led by a black woman, following Burns’ great successes at Xerox. As Ellen McGirt wrote for Fortune in 2017, “Burns’ appointment to the top job in 2009 had been hailed as a milestone. Suddenly it looked more like an anomaly.”
Burns emphasized several early-career elements that contribute to this struggle in McGirt’s story, including:
- Education: “Even with black women graduating from college in record numbers, ‘not enough are coming out of the education system to get them all the way through to the C-suite,’ says Burns. And the black women who do make it often end up in support positions rather than the operational roles that lead to CEO jobs.”
- Connections: Burns says that upper management should put a priority on developing connections with up-and-coming black women: “There is no natural pathway for connection; it’s not going to happen just walking down the hall.” Developing these relationships can help provide direction, she said: “And most young people don’t know what they want to do or be. They just know they want to be me, or whoever they’re talking to.”
Culture and perception
When anyone in business — from entry level to CEO — feels demoralized, that’s a hard feeling to shake. It can derail the progress of promising young professionals and lead them to take their talents elsewhere in search of career development. Research by talent management firm Catalyst showed that this feeling can be common for black women, as McGirt details in her Fortune story.
“They report environments that they feel continually overlook their credentials, diminish their accomplishments, and pile on cultural slights — about their hair, appearance, even their parenting skills,” McGirt writes. “And they often have fraught relationships with white women, who tend to take the lead on issues of women and diversity.”
McGirt quotes Catalyst executive and researcher Dnika J. Travis: “This is what we call an ‘emotional tax.’ The burden of being on guard all the time affects our lives in really negative ways.'”
Access to capital
For minorities who are going the startup CEO route, the quest for funding has its own set of challenges. A study by the U.S. Department of Commerce’s Minority Business Development Agency showed that businesses owned by minorities were less likely to gain access to loan money. Those that do get loans often get a smaller amount and a higher interest rate, according to the report. And some, the MBDA says, don’t even bother trying, “because of a real or perceived likelihood of rejection, which further limits their opportunity for growth.”
“Providing adequate access to capital would help the minority business community reach the goal of economic parity,” the MBDA explains. “Investing in businesses owned by minorities not only makes good business sense, but is an investment in the future growth of the U.S. economy. According to the Census Bureau, by 2050 the nation’s minority population will be the majority. In other words, new businesses, new jobs, and new products will be strongly influenced by, if not created by, the minority community.”
This is a universal component in the professional world. Everyone needs a support system, a guiding hand to help navigate the ups and downs of business. Learning from someone with experience provides a glimpse at a road map, and the shared wisdom can play a significant role in making smart decisions. As human resources consultant Kimberly Reed says in a Black Enterprise story: “For African Americans, mentoring is like oxygen; mentorship helps one uncover the opportunities and possibilities that are beyond the stratosphere.”
Karen Taylor Bass writes in the story that ideal mentors can use “an innovative approach to maneuver the politics and drama of the corporate world.”
“With mentoring you can achieve the following: creating a blueprint for your long-term career goal; securing invitations for the ‘right’ networking functions; mastering the art of negotiation; and winning tips to climbing the corporate ladder,” she says.
A 2013 study made some revealing points about women and minorities rising to CEO levels. Utah State researchers Alison Cook and Christy Glass found that such candidates were more likely to be hired by companies in crisis. If the business continues its decline, then the CEO will likely be replaced by a white man, according to the study: “We term this phenomenon the ‘savior effect.’”
Another phrase regarding this concept is “glass cliff,” as opposed to the “glass ceiling” barrier for women and minorities. Sava Berhane explores this in a story for Fast Company.
“This tells us that not only do women and minorities have a disproportionately harder time moving up the talent pipeline in the first place, they also get riskier leadership opportunities when they get there,” Berhane explains.
Self-awareness — including understanding how they are perceived by others — can play a large role in these scenarios, Berhane writes. And candidates must have a firm grasp on what they are getting themselves into: “Each organization has a history, and you should know it. To avoid being caught off guard, learn the ins and outs of your company, establish your footing as you advance in your career, and keep a certain amount of skepticism about top jobs.”
The power of resilience
Leading a business requires strength, and that applies to character, values, ethics and in being able to withstand the criticism and likely slips and missteps that come with this lofty territory. Resilience takes center stage in a story for Harvard Business Review, which examined the experience of black women who graduated from Harvard Business School from 1977 to 2015. It included analysis of 67 women who reached executive or other high leadership roles. The authors of the piece — Laura Morgan Roberts, Anthony J. Mayo, Robin J. Ely and David A. Thomas — note that resilience is a universal need, but particularly crucial for minority women.
“… The African-American women we interviewed seemed to rely more heavily than others on that quality, because of the frequency with which they encountered obstacles and setbacks resulting from the intersecting dynamics of race, gender, and other identities,” they wrote. “In each case they bounced back, refused to get distracted or derailed, and maintained forward progress. One explained, ‘We were all told that you had to be smarter or run faster or jump higher or be better than anybody else around you just to stay in the game. That was a lesson from early, early on — from my parents, teachers, mentors, church. So you come [to your job] with that orientation.’”
The authors identified three crucial skills that play into resilience among the women surveyed — emotional intelligence, authenticity and agility:
“They became EQ experts, adept at both reading the interpersonal and political dynamics of their organizations and managing their reactions to situations that threatened to undermine their sense of competence and well-being — what some scholars call ‘identity abrasions.’ They practiced authentic leadership through deep self-awareness and an ability to craft their own identities. And they demonstrated agility in their capacity to deftly transform obstacles (including self-doubt and excessive scrutiny) into opportunities to learn, develop, and ultimately exceed expectations.”