Black Boardroom Power 2022: Momentum to Increase  Black Directors Continues but Challenges to Significantly Boost Black Corporate Leadership Persists
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Black Boardroom Power 2022: Momentum to Increase  Black Directors Continues but Challenges to Significantly Boost Black Corporate Leadership Persists

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BLACK ENTERPRISE has produced its annual “Power in the Boardroom” report, including the 2022 B.E. Registry of Corporate Directors—our exclusive listing of Black board members. This editorial package represents the ninth such analysis of diversity within corporate governance over the past decade. black enterprise editors researched the universe of S&P 500 companies to gain a comprehensive picture of corporate diversity and inclusion at the highest level.

The data revealed the following snapshot of Black boardroom power: Amid the S&P 500, there were 474 Black corporate board members at 421 corporations in 2022 versus 425 Black corporate directors at 399 companies in 2021. The figures for 2022 reveal 85% of the S&P had Black directors, up from 60% in 2016, the first year BLACK ENTERPRISE reported on board diversity across the entire index.  

Those figures have been placed in comparison to the fact that 100% of S&P 500 companies now have female board representation. There were 185 Black women directors this year on boards, up 18% from 157 in 2021. Although fewer companies do not have at least one Black director—79 this year versus 100 last year, or a 21% change—Black representation still hasn’t achieved parity across the entire index, which reports a total of 5,466 directors as of May 2022. Statistics reveal that much more needs to be done about Black corporate leadership as the pace of change continues to be lethargic. The top guidance of boards at S&P 500 companies remains exclusively white: There were just 14 Black American board chairs and lead directors in 2022.

Black executives hold only 3.2% of senior leadership roles at major companies, and less than 1% are CEOs, according to the latest study from the Center for Talent Innovation, a New York-based workplace think tank.

And while the 11.5% uptick in Black board membership and 5.5 % rise of companies with Black directors in 2022 showed progress, the needle was moved slightly. The advance was nowhere near the gains of 32% and 30%, respectively, posted in those categories in 2021 – the year after several major corporations announced racial equity pledges after the murder of George Floyd to end institutional barriers and promote opportunities for African Americans. As such, corporate boards remain under intense pressure from outsiders to have directorships that reflect the racial composition of their customer base and the nation.

IDENTIFYING NEW WAYS TO RECRUIT BLACK ENTREPRENEURS AND PROFESSIONALS FOR BOARDS

As Black Enterprise unveiled the report, it also examined these issues with its recent C-Suite/Boardroom Equity Summit. Michael Hyter, president and CEO of The Executive Leadership Council, the pre-eminent organization of Black senior executives, discussed the state of diversity in corporate governance with Black corporate leaders on the panel, “Grooming the Next Generation of Black Board Leadership.” Hyter noted that beyond the Black corporate directors found on S&P 500 boards, “there are still thousands of other publicly traded companies globally without such representation, and many have not embraced a corporate equity mandate to consider or select diverse candidates at the highest levels.” He cites that one of the main arguments for such inclusion is the need for corporations to “embrace new perspectives, achieve greater relevance given the evolving global business environment, and gain diversity of thought around such issues as talent acquisition and development as well as overall business innovation.”

Among his questions, Hyter asked the panelists: Why is it critical for corporate boards to look for different types of directors like entrepreneurs instead of corporate CEOs and CFOs?

Kimberly Blackwell, an independent director of the publicly traded pet care services company Wag! and founder and CEO of the strategic marketing firm PMM Agency, believes her entrepreneurial experience is invaluable in her board service. Blackwell, who has served as a creative consultant and trusted advisor to the C-suite of publicly traded and privately held companies, says entrepreneurs offer a different perspective that is “being more invited and encouraged” given the changing business dynamics.  She recalls Carla Harris, vice chairman of Wealth Management at Morgan Stanley, telling her, “The boardroom is changing, and we are looking for people like you because you do bring a different sense of asking the right questions.”

Hyter also asked what organizations should do to foster the development of board-ready executives and entrepreneurs. Guy Primus, CEO of Valence and co-founder of The Board Challenge, shared, “just knowing who’s out there is key.” Valence, which was recently acquired by the digital banking platform Greenwood, works with Black professionals and others to help accelerate Black corporate advancement. Primus says he has seen a lot of organizations that will host events so that they can know not just board members but future executives as well. “And so really understanding that there are a lot of candidates that can be had and understanding what you’re looking for and going out into the highways and byways and doing that search ahead of time and warm introductions is important.”

Susan Chapman, an independent director at JM Smucker Co. and Toast Inc., says several organizations, at least in the last couple of years, have really put forth efforts to help African Americans get prepared for board service. “I also tell a lot of people that many of us are actually already board ready. We have to get board prepared.” She added it’s also essential for a person to know what value they can add to a board, not just check a box and be a number.

CREATING FRESH PATHS TO BOLSTER ADVANCEMENT AT CORPORATIONS

Another significant issue is outlining a concrete plan for Black corporate advancement. Building the Black C-suite ranks is vital because they will represent the pool of diverse board candidates. The C-suite continues to be one of the major areas where the nation’s largest corporations have struggled to recruit Black talent, and very little progress has been made. For example, the number of companies in the S&P 500 and Fortune 500 with Black CFOs – prime candidates for board slots — rose to 20 in 2021 from 12 in 2020, according to executive search firm Crist Kolder Associates, The Wall Street Journal reported.

Wanting to see corporate America keep making commitments and progress in boosting diverse corporate advancement for years to come was among the reasons Dominique Shelton Leipzig started NxtWork. The nonprofit’s mission includes diversifying the C-suite and the boardroom. Shelton Leipzig is also is a partner at Mayer Brown and a member of its cybersecurity and data privacy practice.

She pointed out that there has been a rise in the number of appointments of African American board members and a reduction in the number of African American CEOs in public companies. “We have to, and we can be, better than this,” she says. “So, what we’ve seen too much of perhaps is the diversity discussion happening in one end and the strategy discussions happening in another end of an enterprise, and we need to merge those discussions together.”

Shelton Leipzig shared the uplifting news that exchanges and investors around the globe controlling trillions of investments and regulators worldwide are looking to see diversity in senior management and the boardroom. There too, is the ESG piece, a significant social component of diversifying the board and the C-suite to meet the demand of stakeholders, employees, and customers from around the world for a global company.

For its part, NxtWork is helping create new routes for Black executives to get into C-suite and boardroom roles Shelton Leipzig is confident her nonprofit will be successful because it facilitates meaningful engagement. She explained that many senior leaders and board members in global companies are looking to diversify but lack the network. As such, that is where Nxtwork can help. She says: “They need the next level of leadership in the Black, Brown, and diverse community, women, etc., to be able to have the boardroom of what is expected today but is really going to be the boardroom and C-suite of tomorrow,” she says.

—Derek Dingle, Butch Graves, Seimond London, and Michael Hyter contributed to this report.


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