There are only five black CEOs currently heading the largest companies (Fortune 500) – and only 15 total ever to have held those positions.
Why do boards need to pay attention to this? Because a diverse leadership team is no longer optional, but rather mission-critical to achieve peak business performance in an increasingly complex, rapidly shifting global business environment. The all-encompassing nature of this change means that boards and CEOs must reconsider the old formulas for leadership development and focus on developing a new generation of leaders who possess the skills that link with strategic priorities. This is clearly the board’s business.
If you think you’ve already got the diversity front covered because you have a Chief Diversity Officer, maybe it’s time to shift your mindset: Start thinking of the CEO as your other Chief Diversity Officer, because any initiative that rises to the level of the strategy must be championed by the CEO and the board.
A recently published white paper based on proprietary research by the Executive Leadership Council (ELC), the preeminent member organization for the development of global black leaders, captures both the urgency of developing a culture that cultivates diverse leaders at every level and some practical guidance on how that can be achieved.
Following are 5 specific actions ELC suggests CEOs and boards take to ramp up enterprise leadership diversity.
- Challenge the assumptions and criteria for key leadership roles. Consider revising the traditional leadership profile to include newer, critical competencies, such as global orientation, multiculturalism, and a combination of traditional proven leadership know-how and “softer” skills, including agility, sensitivity, and the ability to influence, not just dictate, to achieve strategic goals.
- Provide development support from the start. Ensuring candidates of color and women have access to the support and opportunities early in their careers that they require to ascend to enterprise leadership positions will make a critical difference.
- Recognize non-traditional assets. ELC’s research found that black executives may well possess a distinct cultural advantage in increasingly multicultural organizations and overall business environment by virtue of their life-long experience successfully navigating two cultures in their personal lives.
- Implement specific goals for representation. Elevate the urgency of nurturing candidates of color and women with leadership potential by setting specific targets for representation, and compensating managers for success in hitting those targets.
- Know what the roadblocks are. Identify common impediments to developing diverse global leadership, such as considering chiefly staff positions when promoting diverse executives, as well as a perceived lower tolerance for failure among blacks and other underrepresented groups.
Ron Parker, ELC’s CEO, has strong views—rooted in the experience of ELC’s membership and research—on what it really takes to achieve meaningful leadership diversity, and the CEO is central to success: “Diversity and inclusion, like any fundamental organizational change, start at the top. The voice of the CEOs and their teams, both through direct and indirect messages and how they model diversity, is paramount.”
We recommend asking the following questions, proposed by ELC, to determine whether you are on track to building a diverse leadership team:
- What sort of message is your organization sending, from the CEO and the board on down, about the importance of diversity?
- Does the management team demonstrate and not merely call for the broad diversity required to generate the novel ideas and strategies that are essential to successfully competing in a rapidly changing global business environment?
- Do leaders possess a combination of critical business skills and the cultural awareness and sensitivity that will also be essential to recognizing and leveraging opportunity in the marketplace? What about the composition of the board?
The way the board and CEO answer these questions will illuminate what you are “saying” to your organization about where leadership diversity ranks as a priority. So carefully check those explicit and implicit signals; the organization is smart enough to distinguish between lip service and a genuine commitment. Assuming the latter, there is a great deal the CEO can do to champion diversity to develop the workforce and leadership required to compete in a vastly different, continually morphing global business environment.