Black P&L Leader

THE BLACK P&L LEADER INSIGHTS AND LESSONS FROM SENIOR BLACK P&L LEADERS IN CORPORATE AMERICA Project Leaders Project Sponsors Michael Hyter Jean-Marc Laouchez Managing Partner President, Korn Ferry Institute Audra Bohannon Evelyn Orr Senior Client Partner Vice President and Chief Operating Offi cer, Korn Ferry Institute JT Saunders Project Lead Andrés Tapia Global Diversity & Inclusion Strategist Alina Polonskaia Research Team Global Leader of Diversity & Inclusion Solutions Heather Barnfi eld Director of Intellectual Property Development, Korn Ferry Institute Core Team Signe Spencer Audra Bohannon Client Research Partner, Korn Ferry Institute Michael Hyter James Lewis Senior Director and Senior Scientist, JT Saunders Korn Ferry Institute Heather Barnfi eld Annamarya Scaccia Writer and Editor, Korn Ferry Institute Signe Spencer Viet Bui James Lewis Analyst Annamarya Scaccia Jamie Small Hereford Consultant Viet Bui Sydney Morris Jamie Small Hereford Associate Consultant Sydney Morris Emelia Fowora Jennie Wright Aida Foroughi Darcey Eldridge Veronica Xin Ge 2 Acknowledgments for The Executive Leadership Council and The UPS Foundation Korn Ferry and the Korn Ferry Institute would like to express their deepest gratitude to members of The Executive Leadership Council, whose support was integral to this study: Skip Spriggs President and CEO Tonie Leatherberry Board Chair Orlando Ashford Ex-Offi cio Director and Immediate Past Chair Kelly Veney Darnell Executive Vice President and Chief Operating Offi cer Justina Victor Senior Research Manager The Executive Leadership Council (ELC) is a national organization of more than 800 members who are current and former Black CEOs; senior executives at Fortune 1000 and Global 500 companies; as well as entrepreneurs at top-tier fi rms and global thought leaders. Established in 1986, The ELC has worked to build an inclusive business leadership pipeline. The ELC empower Black corporate leaders to make signifi cant and impactful contributions in the global marketplace and their communities. Korn Ferry and The Executive Leadership Council would like to extend special thanks to Eduardo Martinez, president of The UPS Foundation and chief diversity and inclusion offi cer of UPS. UPS’s contribution to this body of work is and will continue to be invaluable. 3 Acknowledgments Korn Ferry and the Korn Ferry Institute would like to express their deepest gratitude to the Black executives and profit-and-loss (P&L) leaders, whose participation in this study and the preparation of this report has been indispensable. Marc Allen Chris Roberts Senior Vice President, Boeing, and President, President of Dairy Foods, Executive Vice President, Embraer Partnership and Group Operations Land O’Lakes, Inc. Orlando Ashford Sonya Roberts President of Holland America Line, Holland Cruise President and Group Leader, Cargill Salt Ann-Marie Campbell Russell Stokes Executive Vice President of US Stores, Home Depot Senior Vice President of GE, President and CEO of GE Power Portfolio, GE Company Michael Conway Executive Vice President and President of Charlene Thomas Starbucks Canada, Starbucks Chief Human Resources Officer, Former West Region President, UPS Lori Dickerson Fouché CEO, TIAA Financial Solutions Shundrawn Thomas Executive Vice President and President of Asset Arnold Donald Management, Northern Trust President and CEO, Carnival Corporation Matt Thornton Marvin Ellison Executive Vice President and Chief Operating President and CEO, Lowe’s Officer of FedEx Freight, FedEx Roger Ferguson Scott Uzzell President and CEO, TIAA President and CEO, Converse Company Marc Howze Steven White Senior Vice President and Chief Administrative President, West Division, Comcast Officer, Deere & Company Anré Williams Jennifer Jackson Group President of Global Merchant and Network President of Capital One Canada, Capital One Services, American Express Donna James Kamilah Williams Kemp Former President of Nationwide Strategic Investments, Vice President of New Business, President and Nationwide Mutual Insurance Company CEO of Northwestern Long-Term Care Company, Northwestern Mutual Kimberly Johnson Executive Vice President and Chief Operating Terrance Williams Officer, Fannie Mae President of Emerging Business Group, Executive Vice President and Chief Marketing Officer, Nationwide Cindy Kent Former President and General Manager of Xavier Williams 3M Infection Prevention Division, 3M President of Public Sector and Wholesale Solutions, AT&T Fred Lowery Senior Vice President and President of Life George Willis Sciences Solutions and Laboratory Products, President of US Operations, UPS Thermo Fisher Scientific Sean Woodroffe Felicia Norwood Senior Executive Vice President and Chief Human Executive Vice President and President of Resources Officer, TIAA Government Business Division, Anthem Lloyd Yates Executive Vice President of Customer and Delivery Operations, President of Carolinas Region, Duke Energy 4 Table of Contents The Rationale 6 Executive Summary 8 The Research 10 Masters of their own destiny 13 Willing to risk it all 16 Not easily shaken 19 A need to overperform—and outperform 23 Punching above their weight 30 Beating the odds 35 Sponsors are critical 39 Recommendations for Organizations 45 The Final Word 49 References 50 5 The Rationale Four. What we’ve found is that all roads lead to bias against Black leaders’ readiness. Unlike their Today, only four Fortune 500 CEOs are Black— counterparts, Black executives are often perceived that’s less than 1%. More than 10 years ago, there by the majority as not having the intellectual were seven. In fi ve years, there may be none. rigor or leadership ability to manage large, highly Even amid progress, corporate America is losing complex P&L positions. But, as the research in this its diversity—and at a fast clip. Organizations report shows, Black leaders are as capable and as have made strides to create more welcoming and prepared—if not more so—to meet the demands inclusive cultures, and yet the number of senior of those roles. Black executives, specifi cally senior Black P&L The Black P&L leaders who participated in our leaders, continues to decline. That has left the study are not only ready to take on tomorrow’s pipeline for Black CEO successors lower than ever business challenges but are in many ways as before, with no real sign of change in sight. strong as, and in several cases more eff ective It’s an alarming reality, one that Korn Ferry wanted than, many of their peers. They believe in their to understand in greater detail. In order to elevate companies’ missions. They’re driven to make an the representation of Black CEOs, we fi rst have impact. They’re determined to succeed—and to understand what prevents Black talent from pave the way for those coming up behind them. advancing into senior profi t-and-loss (P&L) The senior executives in our study systematically positions—the function that, studies show, best manage—and take down—headwinds that have prepares a leader for a CEO role. the potential to get in their way. They forge ahead despite the obstacles, and turn setbacks into growth opportunities. They walk into the offi ce every day with confi dence, courage, and commitment, prevailing and accomplishing what few do. 6 But they are not an anomaly. High-performing Black talent exists at all levels across the corporate community. Yet, despite investing in large-scale diversity-and-inclusion (D&I) initiatives, fi rms are still not bringing enough Black talent into the leadership pipeline. Instead, Black executives are more likely to be positioned in functional roles (think head of human resources, director of corporate social responsibility, or chief diversity offi cer) that are less likely to lead to a chief executive position. By overlooking Black executives, especially those who have the potential to be P&L leaders, companies are missing out on an important source of leadership talent—one that, when leveraged fully, can drive superior results. After all, studies have found that diverse and inclusive organizations outpace the competition. Just consider the numbers: data shows that companies with ethnically diverse executive teams are 70% more likely to capture new markets than their less-diverse peers. If that isn’t enough, they also generate 38% more in revenue from innovative products and services. A sound business strategy alone won’t grow a business. One critical factor to a company’s success is having a diverse mix of talent who can tackle the complex challenges the organization will face now and beyond the horizon. And at a time when new technologies transform markets in the blink of an eye, there’s never been a greater need for leaders who can contribute the new ideas, strategies, and approaches that are required to win in a dynamic and global business environment. To maximize those profi ts, organizations will need to cultivate an engaged workforce that leads to a truly diverse and inclusive C-suite. If they don’t, then they will only hurt their bottom line. 7 Executive Summary Historically, Black leaders have faced considerable headwinds while ascending the corporate ladder, and only a select few have become successful P&L leaders. In fact, fewer than 10% of the most senior P&L leaders in the Fortune 500 are Black. So, what qualities and experiences drive these rare executives to take on the impossible and strive for some of the most sought-after corporate roles? To find out, the Korn Ferry Institute, in partnership with The ELC, interviewed 28 senior Black P&L leaders at Fortune 500 companies. We analyzed these structured interviews as well as the results of Korn Ferry’s Four Dimensions of Leadership (KF4D) psychometric-based assessment, which nearly three-quarters of the 28 leaders completed. In doing this, we learned that the leaders who participated in the study are among the most driven executives in corporate America. We also gathered some powerful Not easily shaken insights about their shared experiences. The Black P&L leaders didn’t let setbacks set Among our key findings: them back. Instead, they powered through obstacles and challenges, and faced adversity with maturity and grace.

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