Yahoo Finance Lack of diversity puts companies at risk of going under, says Ariel Investments Co-CEO Mellody Hobson
While women occupy more seats on public company boards than they ever have before, they still only hold one in five of them, according to data from the research firm Equilar released last month. At the executive level, women hold just 23% of c-suite positions; for women of color, that figure drops to 4%, a McKinsey & Company study found last year.
Companies that don’t address diversity put themselves at risk of financial peril, Ariel Investments Co-CEO Mellody Hobson said in a newly released interview, taped last month.
“I don't equivocate on this: Firms that are not paying attention to this are committing corporate suicide. It may not be fast, but at some point, it will come if you don't pay attention to this,” Hobson says in response to a question about diversity from Yahoo Finance Editor-in-Chief Andy Serwer.
In the course of their work at an investment firm, Hobson and her colleagues speak to leaders from other companies, who she said offer “a lot of excuses when it comes to why boards are not diverse or management teams are not diverse.”
“We do not believe you can be a 21st-century company in this world without having a perspective, and being inclusive, and having a diverse make-up in your employment base,” says Hobson, who sits on the board of directors at Starbucks and JPMorgan Chase.
“We think it's extraordinarily important,” she adds.
Hobson is the co-CEO of Ariel Investments, a firm with assets totaling $12.9 billion, where she worked for nearly the past three decades. Her Ted Talk on challenging racial inequality, given in 2014, has been viewed more than 3.7 million times.
She made the comments during a conversation that aired in an episode of Yahoo Finance’s “Influencers with Andy Serwer,” a weekly interview series with leaders in business, politics, and entertainment.
Hobson said she speaks out about diversity in her role as a board member at Starbucks (SBUX) and JPMorgan Chase (JPM).
“I have a point of view around diversity and inclusion, to the extent that companies are really prepared to talk about the issues and address them,” she says.
In the case of Starbucks and JPMorgan, they are very, very, very serious about this. And so it's great to be a part of that conversation, and move the needle forward in terms of inclusion, and making sure that we have people of color represented in all areas of the business — with our vendors, in our philanthropy, all of those things.”
Andy Serwer is editor-in-chief of Yahoo Finance. Follow him on Twitter: @serwer.
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