Diversity and Inclusion Are No Longer Optional in Corporate America

Senador RiosToday’s guest post comes from Carmelo Ríos, President of the National Hispanic Caucus of State Legislators (NHCSL). Senador Ríos serves as the Senate Majority Leader of the Senate of Puerto Rico. Ríos is also a member of the national Executive Committees of the National Association of Latino Elected and Appointed Officials (NALEO), the Council of State Governments (CSG), and the National Council of State Legislatures (NCSL). 

Diversity and inclusion are a persistent challenge for corporate America. When it comes to Hispanics, despite being more than 17% of the U.S. population, our community comprised only 4% of executive level positions, with only 1% held by Latinas. As far as Fortune 1000 companies are concerned, the situation is worse.

According to a report by Korn Ferry, “Hispanics represent barely more than 2% of directors of boards of Fortune 1000 companies.” This is clearly a problem that affects not only Hispanics but also other minority communities that do not have a seat at the table when major decisions are made by our nation’s largest corporations.

Underrepresentation in corporate America also affects companies’ abilities to connect with their audiences and engage their customers in more meaningful ways. This problem also reflects poorly on the goodwill of a company if their workforce and, more importantly, their executive-level positions are not remotely close to being representative of the overall population nor their customer base. With one in six Americans being Hispanic, there is simply no excuse for this problem to persist. The question now is how to aggressively reduce the gap between hiring practices and available positions for all qualified candidates, including talented minorities.

What can be done about this?

There are several initiatives that have been proposed in the past. No initiative, however well-intentioned or resourced, will move the needle on this problem if there is no recognition that D&I needs to be baked-in to every decision, top to bottom, of the corporate ladder. Intentionality, therefore, is key. If CEOs, board rooms, C-level suite executives and other key players in corporations’ institutional structures do not identify their internal challenges in this field and provide the necessary focus and leadership, increased recruitment and other programs will not fully address the underlying problems.

Companies such as Lilly can show the way for other major corporations. At the National Hispanic Caucus of State Legislators, our experience with Lilly has been tremendous. Not only does Lilly belong to our Board of Business Advisors (BBA), but they also seek us and other organizations for counsel when working to diversify their pool of candidates for top positions. By partnering with national and local organizations, companies such as Lilly can also leverage these relationships to ensure that, when an executive position is open, they have external stakeholders that can help connect with top-notch talent that furthers D&I goals.

Some experts have proposed tying executive compensation packages to performance on increasing diversity in corporate boardrooms and leadership positions. Others have proposed more transparency so that customers, and the public at large, can compare how different companies are performing on this measure. Many companies are experimenting with other cutting-edge ideas, with mixed results. As a recent McKinsey study illustrates: “…diversity does not simply happen—it does not come from a memo or end with the recruitment of a few individuals from target groups. Rather, diversity in the top team and indeed at all levels of an organisation is best achieved through dedicated programmes that focus on specific goals…Successful diversity programmes have clear objectives, are led from the top, and foster active involvement from the wider organisation.”

Therefore, my message to Fortune 500 companies seeking to truly tackle diversity and inclusion is to remember the key word: intentionality.

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