With the racial wealth gap continuing to widen, Black business leader argue there much be a focus on Increasing wealth for the Black community. Currently, white households in the U.S. on average have 10 times more wealth than Black households. Here is what five Black business leaders think should be done to help close the wealth gap.
Support Black Business
“I think one thing that we can all do to change the financial future for the Black community is to support Black-owned businesses. I think representation does matter. It goes a long way to let people in our community know that they can do the exact same thing,” serial entrepreneur Tiffany McGhee told CNBC. The founder, CEO, and CIO of Pivotal Advisors, she is the first African-American woman, and Afro-Latina, to have an institutional investment advisory firm.
Enforce the basic tenets of capitalism
According to Ivory Johnson, founder of financial planning firm Delancey Wealth Management, if the basic tenets of capitalism were enforced, the Black community would have an equal opportunity to create wealth.
The main tenets of capitalism include capital accumulation, competitive markets, price system, private property, property rights recognition, voluntary exchange, and wage labor.
Right now, the free market isn’t working for Blacks. Black women, for example, are paid only 63 cents for every dollar a white man is paid.
“Our country can empower the African-American community financially by enforcing the basic tenets of capitalism,” Johnson told CNBC. “We’d like to be paid according to what the free markets are willing to bear.”
Johnson added, “We’d like equal access to capital and the ability to enforce the terms of a contract in an equitable judicial system. We don’t need a leg up — life is hard for everybody. We’d just like a fair fight.”
Exposure is a Must
For Jason Snipe, founder and chief investment officer of Odyssey Advisors, exposure to opportunities is key to increasing Black representation across industries.
“The most important thing we can do to change the financial future for African-Americans is to expose us. We need to be exposed to all the industries that are out here. Experience is our greatest teacher. We cannot be what we cannot see.”
Teach Personal Finance Early On
“I think other people can impact our communities through two ways. One, to promote personal finance in every school. The second thing, if you own a business or if you’re an executive at a business, hire a college intern to give them that exposure to the industry. Those are two things everyone that is listening can have an impact on,” suggests Degas Wright, founder and CEO of Decatur Capital Management.
Diversity and inclusion must go beyond buzzwords
While Americus Reed, professor of marketing at the University of Pennsylvania’s Wharton School, urges corporations to focus on inclusion, Reed points out “it has to be created, but it also has to be managed. We have to understand how to put different perspectives into our decision-making – into our companies, our brands, our organizations. And those different perspectives, we have to cultivate and manage them appropriately so that we can create the type of organizations that can be successful.”