A growing number of U.S. businesses are publicly championing the Black Lives Matter movement as nationwide protests against racism continue three weeks after the death of George Floyd. But a Newsweek review of the board membership of more than 100 of the country's largest companies shows that, despite the outward show of support, Corporate America has a long way to go to achieve meaningful black representation in its leadership ranks.
Across the U.S., corporate boards—the governing group of elected individuals who represent shareholder interests and oversee business decisions—remain largely white, with black leaders, at best, underrepresented and, at worst, wholly absent. To help shed light on the issue, Newsweek has identified the 20 largest public companies in the S&P 500 (as measured by their market value) that do not have a single black person on their board of directors now.
Consumer and household products giant Procter & Gamble heads the list, followed by information technology companies NVIDIA Corporation and Cisco Systems. Overall, technology companies dominate, comprising more than half the names that appear on the list, which also includes tech powerhouses Adobe, Oracle, QUALCOMM and Intuit.
Companies within the healthcare and consumer goods industries also make multiple appearances. Among them, in addition to P&G: Bristol-Myers Squibb, Philip Morris International and TJX, which operates retail chains TJ Maxx, Marshalls and HomeGoods. (The full list of 20 companies appears below, along with responses from the businesses that answered Newsweek's request for comment.)
"Companies need to be intentional about increasing the diversity of their executive leadership teams," says Crystal Ashby, president and CEO of the Executive Leadership Council, an organization of black senior executives that works to increase inclusivity in business leadership. "The culture of an organization is cultivated by its leaders."
Other studies confirm the dearth of black directors on corporate boards. According to an analysis by Black Enterprise last year, only 307 of the 500 companies in the S&P had at least one black director in 2019, which left 187 of the country's biggest companies—37 percent of the S&P total—with no black members on their boards. There were 322 black directors in all at S&P 500 companies out of roughly 5,500 board seats. That means that black board members made up about 6 percent of the director total—a far lower representation than the 13.4 percent of Americans who self-identify as black, according to the U.S. Census Bureau.
Unfortunately, those large S&P 500 companies actually represent the benchmark in diversity because the smaller a company is, the less likely it is to have a black or other ethnic minority director on the board. For instance, only about 4 percent of director roles among the companies that make up the Russell 3000, a broad market index that represents most publicly traded companies, were held by black leaders last year, according to an analysis by Institutional Shareholder Services. That's up only marginally from the 3.6 percent of board positions held by black individuals in 2008.
"We've seen anemic progress to date but this is a watershed moment that must spur private and public boards into accelerated action," says Janet Foutty, executive chair of the board for Deloitte, which has separately researched board diversity among Fortune 500 companies.
Ashby, of the Executive Leadership Council, agrees, noting that her organization has seen an uptick in inquiries for black directors since the Black Lives Matter protests began. "I'm optimistic that company leaders are finally serious about confronting systemic inequality," says Ashby. "We've seen more change within business-to-consumer companies than business-to-business companies, but corporate leaders are accepting that increasing the diversity of their boardroom gives their organizations an edge."
In fact, studies show that greater board diversity is associated with a better bottom line. A McKinsey report found that companies with the most ethnically or culturally diverse boards worldwide were 43 percent more likely to experience higher profits.
Whether that business imperative, combined with the increasing public scrutiny and pressure for racial equality, will drive meaningful change in the composition of corporate boards remains to be seen. For now, the following 20 companies remain the largest in the S&P 500 that do not currently have black representation on their corporate boards.
1. The Procter & Gamble Company
Industry: Consumer staples: household products
Annual revenue: $67.7 billion
2. NVIDIA Corporation
Industry: Information technology: semiconductors
Annual revenue: $10.9 billion
Company response: "Corporations must act and NVIDIA must act. It is not enough to just be a well-intended, inclusive employer and provide equal opportunities for Blacks. We must purposely and systematically create opportunities for Black employees, starting with me. We will elevate the urgency of increasing the Black population at every level of our company and do our part to fight racism," NVIDIA's CEO Jensen Huang said at the company's 2020 stockholders meeting June 9.
3. Cisco Systems, Inc.
Industry: Information technology: communications equipment
Annual revenue: $51.9 billion
4. Adobe Inc.
Industry: Information technology: application software
Annual revenue: $11.2 billion
5. Oracle Corporation
Industry: Information technology: systems software
Annual revenue: $39.5 billion
6. Bristol-Myers Squibb Company
Industry: Health care: pharmaceuticals
Annual revenue: $26.1 billion
7. Broadcom Inc.
Industry: Information technology: semiconductors
Annual revenue: $22.6 billion
8. Danaher Corporation
Industry: Health care: health care equipment
Annual revenue: $17.9 billion
9. Philip Morris International Inc.
Industry: Consumer staples: tobacco
Annual revenue: $29.8 billion
Company response: "Our board of directors comprises a diverse group of individuals, with nine different nationalities represented. This composition underscores the global perspective necessary to guide the international nature of our commercial operations. We of course take issues of diversity and inclusion very seriously, and to that end in March named our first-ever Chief Diversity Officer to our senior management team."
*Philip Morris International does not sell or market any tobacco products in the U.S.
10. QUALCOMM Incorporated
Industry: Information technology: semiconductors
Annual revenue: $24.3 billion
11. Intuit Inc.
Industry: Information technology: application software
Annual revenue: $6.8 billion
Company response: "We've made progress on having a board that brings a diverse set of voices and experiences to Intuit. We openly condemn racism in any form and stand in unity with our black colleagues, friends and communities. We know there is always more work to be done to ensure even broader diversity to our workforce, our management team and to our board. While we have nothing specific to announce at this time, this is an ongoing conversation at Intuit and we are committed to continued progress," says the company's chief diversity officer, Scott Beth.
12. ServiceNow, Inc.
Industry: Information technology: systems software
Annual revenue: $3.5 billion
13. Fiserv, Inc.
Industry: Information technology: data processing and outsourced services
Annual revenue: $10.2 billion
14. Intuitive Surgical Inc.
Industry: Health care: health care equipment
Annual revenue: $4.5 billion
15. Advanced Micro Devices, Inc.
Industry: Information technology: semiconductors
Annual revenue: $6.7 billion
16. Automatic Data Processing, Inc.
Industry: Information technology: data processing and outsourced services
Annual revenue: $14.2 billion
Company response: "ADP's Board seeks an optimal mix of leadership continuity and fresh perspectives, with the right skills and diverse experience to oversee our corporate strategy. We continue to strive for greater diversity at all levels of ADP and are committed to working together to ensure all individuals within our organization are valued and celebrated for their differences," says John P. Jones, chairman of the board for ADP.
17. The TJX Companies, Inc.
Industry: Consumer discretionary: apparel retail
Annual revenue: $41.7 billion
Company response: "At TJX, we have considered inclusion and diversity a very important part of who we are as a Company for many years. Regarding our Board of Directors, TJX is proud of its diverse composition. Seven of our eleven Board members reflect gender or ethnic/racial diversity. While we do not have a Black or African-American Director at this time, we regularly look for potential candidates to refresh our Board."
18. Equinix, Inc.
Industry: Real estate: specialized REITs
Annual revenue: $5.5 billion
19. Micron Technology, Inc.
Industry: Information technology: semiconductors
Annual revenue: $23.4 billion
Company response: "While Micron has made some progress against our goals to deepen our many dimensions of diversity, increase representation of underrepresented groups, and improve pay equity, we recognize that we have much more to do. This fiscal year we introduced a new requirement for all VP and above openings to have a diverse candidate slate. Additional steps we've taken in fiscal year 2020 and fiscal year 2019 include: the appointment of two women to Micron's board of directors, hiring the company's first vice president of Diversity, Equality & Inclusion, doubling Hispanic/Latinx representation in senior leadership ranks, introducing a Black/African American Employee Resource Group, expanding recruiting at several historically black colleges and universities, and participating in the National Society of Black Engineers conference."
20. CSX Corporation
Industry: Industrials: Railroads
Annual revenue: $11.9 billion
Company response: "Until last month's retirement of a Board member, CSX is proud to have had African American representation for the better part of the past 25 years. CSX has a long-standing commitment to diversity and the Board is guided by the CSX diversity philosophy when considering director nominees. We recognize the importance of maintaining a Board with a broad scope of backgrounds and expertise. We believe that candidates representing varied age, gender, cultural and ethnic backgrounds add to the overall diversity and viewpoints of the Board."
Notes: To identify the largest public companies without black members on their boards, Newsweek reviewed every individual board member listed at the largest companies, by market capitalization, within the S&P 500. We cross-referenced our findings with those of Black Enterprise, which tracked every serving black board member in their 2019 "Power in the Boardroom" report. Market capitalization, total annual revenue and industry data were provided by S&P Global Market Intelligence, as of June 11, 2020.
Kerri Anne Renzulli is a personal finance journalist based in London. She has worked for CNBC, Financial Planning magazine and Money. Additional reporting by Sarah Dreher.
Correction 6/17 3:25 p.m. This story has been corrected to reflect that the comment from Intuit came from its chief diversity officer, Scott Beth, not CCO Adam Sohn, as the company originally stated in its email response to Newsweek.
