Crisis in Black Nonprofits

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A report on the changing demographics of senior management teams at the world’s leading corporations shows an alarming level of turnover, shortened CEO tenure and increasing difficulty in acquiring top talent.

The report “The Changing Face at the Top: Global Survey Results 2008” says age, ethnicity, gender composition and disparities in advanced education are key factors contributing to a decline in C-suite talent worldwide. While women and minorities are important demographics for executive search firms to help meet the talent shortage at various levels, the likelihood of greater ethnic diversity at C-suite level (chairman/CEO and executive management team) is extremely low, the report shows. It notes that the rapidly dwindling pool of executive replacements is the result of a lack of foresight and planning to encourage talent development and retention.

Issued in May by Epsen Fuller | IMD, an international executive search and consulting group, the report is based on interviews with 378 top-tier executives worldwide. It follows the firm’s 2006 survey “Mobility of Managers.” 
A wider than acknowledged generational gap exists, the report says, where baby boomers (individuals born between 1946 and 1964) approaching retirement have not made adequate provisions for their Generation X (those born between 1965 and 1982) and Y (those born from 1983 onwards) successors.

Currently, one-third of all C-suite executives are younger than 45; only 6.8 percent of CEOs, 9.9 percent of CFOs and 10.9 percent of COOs are women; internal processes hinder C-suite promotions from within; fewer than 10 percent of all executives are ethnic minorities; and only about 20 percent of all executives differ in nationality from that of the country in which their company’s headquarters are based. While 78 percent of respondents believe that diversity is an important strategy, only 14 percent reported having a corporate diversity officer and only 13 percent believe the number of minorities in the executive suite will increase in the next three years. At the same time, 26.4 percent see the C-suite increasing in the number of foreign nationalities on their management team, reflecting continuing globalization of business.

Christopher Metzler, Ph.D., associate dean of Human Resources and Diversity Studies at Georgetown University, in Washington, D.C, says most companies have career-track pipelines, but the number of African-American numbers in those pipelines is small. African-Americans are not in operations management positions, where they could become eligible for accession to the C-suite, but tend to be in human resources, Metzler says. To correct that disparity, African-Americans with C-suite aspirations should ask themselves whether they want to be in the C-suite of someone else’s organization or whether they should start their own organization and be in their own C-suite; whether they have performed an honest self-assessment of their skills and talents, especially coming from a support role like human resources to an operational function, to ascertain what may be missing; and whether they understand the politics and formal and informal rules of the organization.

Because formal and informal rules in many corporations are created or destroyed at whim by a still active and strong old-boy’s network, African-Americans need to avail themselves of the places where the real decisions are made: at a bar, on a golf course, at a pre-meeting meeting, or a post-meeting meeting, Metzler says. “African-Americans have bought into the notion of formal equality. If that’s the case, then why are our numbers in the boardroom so bad? There is no substantive presence,” he says. He notes that African-American women in the C-suite pipeline number slightly more than women of other cultures and more than African-American men. He advises African-Americans C-suite aspirants to concentrate on obtaining a master’s degree in business administration or a law degree, but warns that the outlook for African-American ascendancy into the C-suite for the remainder of 2008 and into 2009 continues to be bleak.