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How would things be different if more women and people of color headed up Fortune 500 companies? Click here to tell us what you think or read what DiversityInc readers are saying.
The resignation of Merrill Lynch's CEO E. Stanley O'Neal and the impending exit of Time Warner's CEO Richard Parsons, both of whom are black, has people wondering why there are so few CEOs of color at the helm of Fortune 500 companies—and why there are so few women CEOs. Parsons, who was ushered into the CEO spot at Time Warner amid great fanfare and whose management stabilized the media conglomerate following its disastrous merger with AOL, plans to resign from Time Warner's CEO post Jan. 1. He will retain his seat as chairman of the company. O'Neal was shown the door at Merrill Lynch because of the $2.2-billion hit the firm took after it invested in the subprime-mortgage market and because he went behind the board to discuss a merger with Wachovia. Parsons' exit further shrinks the pool of high-profile CEOs of color. In 1995, not one Fortune 500 CEO was a person of color. Today, 14 Fortune 500 companies are run by people of color. After Parsons resigns, only four black CEOs of Fortune 500 companies will remain: American Express and Darden Restaurants are Nos. 23 and 45, respectively, in The 2007 DiversityInc Top 50 Companies for Diversity®. The number of women who are Fortune 500 CEOs has grown slowly but steadily throughout the last decade. Three women were CEOs of Fortune 500 companies in 2000, six in 2002 and nine in 2005. Today, 13 Fortune 500 companies are run by women. Indra Nooyi is the only woman CEO of a Fortune 100 company and the first woman of color ever in that capacity. Nooyi is one of two Fortune 500 women CEOs of color; Andrea Jung of Avon Products is the other. Ranked by their companies' position in the Fortune 500, they are: Source: Fortune Magazine, Catalyst PepsiCo is No. 10 in the Top 50 and Xerox is No. 7. So why are there so few? A significant reason is that there are still too few senior leaders of color and women throughout corporate Otis said as much in an interview with National Public Radio in 2006. When asked by NPR's Ed Gordon about the biggest challenge he faced when climbing the corporate ladder, Otis said the lack of senior leaders of color. "[The] biggest challenge is really not having the role models, not seeing yourself at the senior levels early on in your career," said Otis. Executives of color and women executives, unlike white-male executives, have to see past the dearth of senior-level executives of color and women executives and focus on the similarities they can find with white-male executives. That's a tough assignment considering the human predisposition for seeking out people who are similar. Otis said it was a challenge to get past that and really " look at others who don't look exactly like you as role models, but they have backgrounds that have a great deal of similarity." Otis said Darden has a tradition of hiring and developing executives of color that dates back to when the company was founded. That tradition and corporate culture is what ushered him into the CEO suite. "[Diversity retention/succession planning] really positioned me to be successful at Darden—ultimately to get the job that I have today," Otis said to NPR. Too often, executives of color are stuck in the "early stretches of career structures," economist Sylvia Ann Hewlett told the Christian Science Monitor in 2006. Hewlett, along with Princeton Prof. Cornel West, surveyed professionals of color and women professionals to study what led to senior-level success. Their survey showed that "[Executives of color and women executives] are not getting promoted and advanced at a rate commensurate with their weight in the talent pool," Hewlett told the Monitor. Being Different Does Not Translate Into Upward Mobility Hewlett and West surveyed more than 1,600 executives of color and found that personal and cultural traits that are different from the white-male norm can overshadow superb skills, reported the Monitor. Hairstyles that include Afros, locks or braids, wearing ethnic jewelry or using animated hand gestures and certain types of nail manicures identified executives of color and women executives as different. "Today [prejudice is] much more subtle, but it's pervasive," Hewlett told the Monitor. "Whether it's a tone of voice or hairstyle or accent, the cumulative impact can be brutal and can derail a career." More than 40 percent of executive women of color who work at large corporations reported to Hewlett and West that they felt "excluded and constrained by style compliance [and a] need to blend into a corporate culture dominated by white men. More than a third of minority men feel the same way," reported the Monitor. One method to impress the white-male CEO and senior leaders is to join organizations outside of the company with which they are affiliated. Many executives of color, however, involve themselves—and for good reason—with charity work. Of the executives of color Hewlett and West surveyed, one-quarter were religious leaders, nearly 30 percent mentored underprivileged youth and 40 percent were involved with "social outreach initiatives," reported the Monitor. Here is a list of Latino CEOs of Fortune 500 Companies. To date, four Fortune 500 CEOs are Latino: Eastman Kodak Co. is No. 35 on the Top 50 list. Five Fortune 500 CEOs are Asian, including two women: PepsiCo is No. 10 in the Top 50.