More than 150 companies recently signed a letter calling on Congress to pass legislation that would restore voting safeguards to prevent discrimination against voters of color. This move points to the urgency of the moment and illustrates corporate America’s increasing comfort in taking a stand on national-level public policy to advance racial equity – but the reality is that business leaders are still struggling to develop a long-term plan for advancing racial equity within their companies, communities, and across our society.
During a recent set of interviews exploring how dozens of C-suite executives at some of America’s largest companies feel they are progressing on diversity, equity, and inclusion, we found that most leaders indicated there is an urgent need for change, but admitted the path to get there is unclear.
This uncertainty will lead to lags in progress. Research over the past year has shown that, despite rising calls for racial justice, efforts so far have been incremental. According to research from PolicyLink, in 2018, more than 100 million Americans were living below 200% of the federal poverty level – meaning that for every third American, even a short-term illness, loss of income, or emergency expense was likely to be insurmountable.
If you are a CEO, let that number sink in – and know that it’s steadily increasing with economic insecurity disproportionately impacting communities of color, who despite comprising 38% of the U.S. population represent 52% of those living in economic insecurity. Know, too, that while corporate leaders are doing more today than they were, say, three years ago, there’s much, much more to do. JUST Capital’s Corporate Racial Equity Tracker shows that change so far has been incremental, with America’s largest employers more likely to disclose baseline DEI commitments – like diversity and opportunity policies – than concrete actions – like quantitative diversity targets – that show accountability toward progress.
Americans agree that businesses are lagging behind – with a recent survey from JUST Capital and The Harris Poll finding that 95% of Black Americans believe it’s important for companies to promote racial equity, but 80% agree they can do more.
In order to truly meet the needs of the moment, corporate leaders must strive for results against stated commitments – and based on our collective research at PolicyLink, FSG, and JUST Capital, we’ve developed key principles and strategic guidance for corporate leaders looking to move from incremental commitments to enterprise-wide transformation. Our 2021 CEO Blueprint for Racial Equity provides concrete actions across three broad domains of corporate influence:
- Within the Company: Embedding accountability within corporate governance actions and leadership performance – from establishing board oversight of racial equity strategies to conducting an enterprise-wide racial equity audit to establishing antiracist hiring policies, and more.
- Within the Community: Building authentic and long-lasting relationships with communities of color – from cultivating inclusive pipelines of workers from local communities to mitigating environmental impacts to advocating for local policy changes that drive equitable outcomes, and more.
- Within Society: Underscoring the singular power of C-suite leaders who can use their voice and influence to advance racial equity – from ensuring transparency in political giving reporting to using corporate lobbying infrastructure to reduce racialized inequality to leveraging corporate influence to advance racial equity in public policy, and more.
These actions – and the others outlined in the Blueprint – provide a North Star, but they are not sufficient on their own to align market actors around the actions that drive equity and how to measure, report, and incentivize progress. PolicyLink, FSG, and JUST Capital are leveraging key takeaways from the Blueprint and working alongside additional partners to develop rigorous corporate performance standards for racial equity that set the bar for what good looks like and establish consistency for how corporations should approach, measure, disclose, and speak publicly about their efforts to advance racial equity.
Without consistent alignment and cohesive strategies, these issues are in danger of falling to the backburner once again, crossed out in strategic plans and deprioritized due to discomfort or lack of knowledge.
Defining the performance metrics of equity for corporate America will catalyze a new way of doing business and ensure that everyone has the opportunity to thrive and reach their full potential. If our capitalist nation hopes to achieve an equitable society, corporate America must operate equitable businesses and help lead the way for long lasting change.
Mahlet Getachew is the Managing Director of Corporate Racial Equity at PolicyLink, Yusuf George is the Managing Director of Programs and Strategic Engagement at JUST Capital, and Kendra Berenson is Associate Director at FSG.