Racial/Gender Homogeneity in Corporate Board Leadership

In response to criticism from two major shareholders about the lack of diversity in its board of directors, Apple Inc. recently added language to its governance charter committing to seek women and minorities for consideration. The board currently consists of seven white males under the age of 50 and one Asian American woman. In an industry known to be built on the need for innovation, the singular homogeneity of Apple’s board is surprising, although far from unusual.

Other Silicon Valley companies have faced similar questions about their male-dominated leadership including Facebook and Twitter who were criticized for not having female directors prior to their initial public offerings.

The biannual report of the Alliance for Board Diversity reveals that both women and minorities are underrepresented in Fortune 500 boardrooms. Only about 17 percent of the 5,488 board seats are held by women. And minority women comprise 3.2 percent of these positions, while minority men hold 10.1 percent. The report also notes that African Americans, Hispanic/Latinos, and Asian/Pacific Islanders have experienced losses or only small gains in corporate board representation in the past year.

In our new book, The New Talent Frontier: Integrating HR and Diversity Strategy in the Private and Public Sectors and Higher Education , Alvin Evans and I argue that talent is the primary strategic asset needed for organizational survival in a globally interconnected world. As a result, organizations need to optimize their talent resources by building synergy between HR and diversity programs. Maximizing organizational capability requires that organizations respect, nurture, and mobilize the contributions of a diverse and talented workforce.

In an article entitled, “Does a Lack of Diversity among Business Leaders Hinder Innovation?” Sylvia Ann Hewlett, Melinda Marshall, and Laura Sherbin share the results of a survey conducted by the Center for Talent Innovation of 1800 men and women in white-collar professions that also included Fortune 500 executives. The authors found that due to homogeneity in the leadership ranks, the majority of companies fail to realize their full innovative potential. Fifty-six percent of the respondents indicated that leaders at their firms failed to find value in ideas that they have difficulty relating to or don’t see a need for. As a result, senior leaders lose revenue-generating opportunities when they do not create a “speak-up culture” in which employees can contribute innovative or out-of-the-box ideas. The findings appear to support a strong correlation between inclusive behaviors and acquired diversity.

As Joe Feagin eloquently observes in Racist America:

When Americans of color are oppressed in this country’s institutions, not only do they suffer greatly, but the white-controlled institutions and whites within them often suffer significantly if unknowingly. Excluding Americans of color has meant excluding much knowledge, creativity, and understanding from society generally. A society that ignores great stores of human knowledge and ability irresponsibly risks its future.

In this sense, the exclusion of minorities and women from the board rooms of American corporations indeed irresponsibly risks the future of American entrepreneurialism by overlooking the innovative contributions of diverse leadership.


  1. Earl Smith

    Dang. If the leaders of irrational capitalism know they are losing MONEY by locking out women and minorities from board positions, ruining their future earning how is this being explained? Capitalists don’t like losing money, but study after study like this one shows this to be the case. Or, is the empirical evidence too weak to demonstrate the facts? The only “businesses” that year in and year out lose money, yet keep plowing the same old road are intercollegiate and professional sports teams because you have to have losers to have winners.
    Help me understand all of this; would love to see a paragraph laying out why these business leaders perform in this manner. Can’t be they just don’t like women & minorities.
    E. Smith

    • edna

      Thanks for the interesting questions. Some of the reasons why boards are reluctant to diversify are identified in an article by Jayne Barnard (“More Women on Corporate Boards? Not so Fast?”)in what she calls “powerful pushback” against board diversification.

      Barnard discusses the reasons for lack of diversification: the perceived need for cohesiveness of boards and the insistence on working within one’s social comfort zone (the “similar to me” effect); failure of the business case for diversity; lack of a springboard or pipeline into executive positions; tendency of most CEO’s to be white male; and traditions of exclusion based upon stereotypes and bias. She sees institutional investors as the most powerful advocate for board diversification.

      Just some thoughts on this complex phenomenon.

Leave a Reply