Diana Rojas reports on CEO Action for Diversity and Inclusion, a group of 400 companies, started by PwC, who are trying to tackle America’s race divisions in their organizations, and reaping the business benefits
While rising through the ranks in the information technology industry, Heather Brunner avoided drawing attention to the fact that she was a woman. She didn’t talk about her husband, and when she started her family, she didn’t talk about her kids. She wanted to be judged on her merits alone.
But, speaking at a conference to kick off a discussion on diversity and inclusion 10 years ago, Brunner – who recently celebrated her fifth year as CEO of tech firm WP Engine, based in Austin, Texas – said that she finally “came out” as a woman.
“I realized that as I became a mother of two daughters, I was making a huge mistake not talking about the fact that I am a woman, I am a mother, and that I can also kick ass in a high-performing organization,” said Brunner.
What’s the business case for homogeneity? And still we haven’t been able to crack the code to change it
As a CEO, Brunner is a rarity: almost 70% of board seats in Fortune 500 (and more in the broad Fortune 1000) companies are held by white men.
But she is one of more than 400 CEOs who have signed on to CEO Action for Diversity & Inclusion, whose signatories pledge to advance the issue in the workplace by promoting open and often difficult conversation, implementing an expanding unconscious bias training, and sharing best – and failed – practices.
After the police shooting in Louisiana of Alton Sterling, an unarmed man, the then newly installed CEO of PwC, Tim Ryan, opened up difficult firm-wide conversations about race. That led to external conversations and collaboration to create the CEO Action coalition last June. There are no financial commitments, no metrics or compliance. The group marked its first anniversary on 12 June.
“We have to keep talking about it so that the next generation – my daughters – won’t be having as many diversity inclusion panels,” Brunner said.
In the year since the coalition’s launch, the US bore witness to a violent white-supremacist march on Charlottesville, Virginia, last summer; the explosion of the #MeToo movement in the fall; and, most recently, the ejection of two black men from a Starbucks that led to a much publicized franchise-wide afternoon shutdown for employee unconscious bias training in late spring – an event that brought worldwide focus to the issue of corporate diversity and inclusion.
“Will all of [Starbuck’s] employees get it right? No, probably not. But that’s why we have to keep the conversation going. And that conversation is: how can we work together so that it doesn’t happen more often?” said Shannon Schuyler, responsible business leader and chief purpose officer with PwC, who volunteers her efforts with CEO Action.
Diversity attracts diversity. When I see people like me getting promoted, I want to be a part of that
Early this month, the issue was again brought to prominence when Google employees partnered with investors to push a proposal at its parent company's shareholder meeting to link executive pay to diversity and inclusion metrics. (See Investors turn up pressure on Google over gender and diversity)
The proposal, by investment firm Zevin Asset Management, was predictably voted down as Google’s founders have majority voting control.
While society looks askance at private business to act, and react, to social issues and injustices, there is a business imperative for diversity and inclusion: a January McKinsey report on diversity said that the top 25% of companies for racial and ethnic diversity are 33% more likely to have better returns than industry averages. For gender diversity, that returns increase is 21%. The report noted that companies in the lowest 25% for both ethnic/racial and gender diversity underperform financially.
“What’s the business case for homogeneity? And still we haven’t been able to crack the code to change it,” said Schuyler.
In the US, women account for just 16% of executive team members; 4% are black, Hispanics 4% and Asians 5%. As of May, fewer than 5% of Fortune 500 CEOs are women, according to Fortune.
“The topic around diversity and inclusion was not at the same level of consciousness a year ago that it is today,” said Brunner.
‘Having a much wider aperture of what talent is has been dramatically powerful for our business’
At PwC, where CEO Action had its beginnings, women represent 19% of the partnership, 50% of campus hires and 45% of experienced-level hires globally. To facilitate professional connections and mentoring in-house, the firm promotes Circles – forums that connect employees and promote opportunities for minorities, women, parents, LGBT and the disabled.
Last year, PwC funded a project with Harvard University called Outsmarting Human Minds, which offers the public short videos and podcasts to uncover unconscious biases and figure out ways to overcome them. Schuyler said that at PwC candidates cannot interview or advance without taking unconscious bias training.
One big challenge is that while many companies start out relatively diverse, the pipeline isn’t diverse enough to replace minority/female hires that aren’t retained.
“You may be the best person for the job if no one is put up next to you,” she said. “But in order to know that, a candidate needs to be put alongside other people, of all types … The conversation is that we’re not looking at the full complement of candidates.”
Brunner, of WP Engine, noted that women comprise 40% of the company’s executive team and 22% of its non-executive management. Non-whites account for 30% of its employees, and some 35% of employees across four offices do not have college degrees. And importantly, she noted, 27% of employees got a promotion last year.
We are as powerful as our voices … Our voice can be even more powerful when it is a collective voice
New tech-support employees get seven weeks of training before serving customers to allow those who have never worked in tech before to become proficient; leadership and management training is offered, and they’ve even created an app called Lunchmeet that allows employees to meet up with and get to know others from different sectors of the company. Going forward, Brunner said that the company will be investing more in employee-wide unconscious bias and diversity training. And she noted that they are looking to improve their support of mothers re-entering the workforce, and of families.
But the most important element to diversifying the employee pool has come from within: some 40% of employees were referred by another employee.
“Having a much wider aperture of what talent is has been dramatically powerful for our business,” said Brunner. “Diversity attracts diversity. When I see people who are like me across the company, who are thriving and getting promoted, I want to be a part of that.”
Cleveland-based KeyBank, which was the first Top 20 US bank to name a woman, Beth Mooney, as CEO in 2011, redoubled efforts to improve diversity several years ago, according to Kim Manigault, chief diversity and inclusion officer. The bank focused on expanding the talent pipelines, providing education and resources for leaders and recruiters, expanding awareness of the company among diverse groups, and strengthening bank relationships with campus, community and professional organizations.
Internal efforts to attract, develop and retain a diverse workforce include company-sponsored employee resource groups, called key business impact and networking groups (KBINGs), for African-American, Asian, disabled, Latino, women, LGBT, military, Jewish and young professionals.
Even if a company throws a woman or a minority on the board ‘to shut people up’, that one person can affect the conversation
Last year, KeyBank launched an unconscious bias programme that was sponsored by the head of the retail branch network. Over four weeks, some 98% of branch network employees participated. Later, the programme was transformed into one for 1,800 leaders and managers, and then an enterprise-wide e-learning course. A total of 16,000 employees have participated in one version of the programme.
“When I think about a sense of urgency on this topic, it’s about how we can be proactive every day, regardless of what is happening on a broader scale,” said Manigault. KeyBank’s CEO Mooney has signed on to CEO Action, and Manigault sees it as an opportunity to amplify the work being done in corporate America. “We are as powerful as our voices … Our voice can be even more powerful when it is a collective voice.”
Wanda Bryant Hope, chief diversity and inclusion officer at Johnson & Johnson, said customers expect the company to play a role on societal issues. She noted how J&J signed an amicus brief for the landmark 2015 civil rights case Obergefell v Hodges, which eventually brought marriage equality to all states, and how LGBT leaders have credited the power of companies banding together in moving public opinion.
“We take a deliberate approach to determine where, when and how we will take a stand and make an impact,” said Hope.
But the real reason to diversify the workforce is a business imperative: in order to succeed, the company must understand the needs and wants of an increasingly diverse, worldwide customer base, she said.
In-house, the company’s approach to diversity and inclusion has been data-driven, she said. Three years ago, J&J rolled out an unconscious-bias training programme for all of its employees but, she pointed out, “building an inclusive culture … takes more than a single training effort”. Hope said the company depends on metrics, including an inclusion index in its employee engagement survey, to hone and prioritize the culture. And by using artificial intelligence technology to root out gender bias from job descriptions, the company has seen an uptick in more diverse applicants for those positions.
Our research shows that fostering an inclusive culture provides benefits not only for our employees, but for the organization as a whole
“The urgency has less to do with today’s political climate than the fact that our internal and external research consistently shows that creating and fostering an inclusive culture provides benefits not only for our employees, but for the organization as a whole,” said Hope.
Schuyler said that while every topic can have players who do things for show, fears of “greenwashing” in diversity and inclusion don’t worry her too much. Even if a company throws a woman or a minority on the board “to shut people up”, that one person can affect the conversation and the board will see a positive change.“One person does make a difference and that difference can be seen and felt,” said Schuyler.
Diana Rojas is a freelance writer based in Washington, DC, and a regular contributor to the Ethical Corporation, focusing on environmental policy and sustainability issues. Diana is fluent in Spanish and Portuguese.
This article is part of the in-depth briefing, Gender and Diversity. See also:gender equality CEO Action of Diversity & Inclusion PwC. WP Engine Johnson & Johnson KeyBank Outsmarting Human Minds project