Company leaders and boards have been under pressure to finally diversify their C-suite. And in 2021, the number of Black finance chiefs went up drastically. Recruiters predict this trend will accelerate in 2022.
The number of companies in the S&P 500 and Fortune 500 with Black chief financial officers nearly doubled over the past year, to 20 in 2021 from 12 in 2020, based on new data from executive search firm Crist Kolder Associates.
Telecommunications giant AT&T Inc. promoted Pascal Desroches; sports apparel retailer Foot Locker Inc. hired Andrew Page; and investment firm Teachers Insurance and Annuity Association of America hired Dave Dowrich. Animal-health company Zoetis Inc. and industrial-supply company W. W. Grainger Inc. also recruited Black finance executives, according to The Wall Street Journal.
Increased hiring of diverse CFOs and other Black executives is an encouraging trend, Zoetis CFO Wetteny Joseph said, “but companies must continue to invest in a diverse pipeline, especially early career, in order for it to be a lasting and bigger change.”
“More companies should be intentional about having a diverse perspective within the executive team and creating an atmosphere where everyone has the opportunity to contribute results,” said Deidra Merriwether, Grainger’s CFO. This means mentorships and training.
There has been a push for more corporations to take diversity seriously since the George Floyd protests starting after the May 2020 death of the Minneapolis man.
“I have been getting a lot of calls,” said Kofi Bruce, the chief financial officer of General Mills Inc., one of the world’s largest food companies. Bruce, who is Black, was hired by General Mills in 2009 as treasurer. In February 2020, he was promoted to CFO. Last year, Bruce was approached by other companies with opportunities to join boards or management teams. He took this as “a sign of people trying to build representation,” Bruce told The Wall Street Journal in May 2021.
Recruiters say companies are actively seeking Black finance executives. “The Floyd killing put a spotlight on companies’ efforts to recruit more diversely and accelerated a trend that began before,” said Peter Crist, chairman of Crist Kolder Associates, an executive search firm. “Every project we now do starts with a conversation about women and minorities.”
Still, Black executives face challenges in rising up the corporate ladder. There are few spots at the top, and whites still dominate them. On average, CFOs at firms in the S&P 500 and Fortune 500 have a tenure of about five years, meaning open slots are limited.
On top of this, hiring bias is still strong. “We all try to hire people that we can relate to,” said Pascal Desroches, AT&T Inc.’s finance chief, who is Black, noting the unconscious biases through which people tend to hire candidates who are similar to themselves.
For progress to continue, companies have to remain consistent in their diversity efforts. “It is still early innings, and if we are not careful, we lose the momentum, and we will have the same conversation in five or 10 years from now,” said Black finance exec Jamere Jackson, the CFO of auto-parts retailer AutoZone Inc. and the former finance chief of Hertz Global Holdings Inc.
“I think we are on a journey here,” said AT&T’s Desroches. “This is something that takes time.”