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In 2020 companies took up the cause of racial equity. Now the challenge is accountability. ‘It really starts from the top.'

Abdel Jimenez, Chicago Tribune on

Published in Business News

Before several Chicago-area companies pledged in 2020 to diversify their ranks in response to calls for racial equity, Beam Suntory was on its way to hiring its first chief diversity and inclusion officer.

The Chicago-based maker of Jim Beam bourbon and other spirits spent two years developing goals to recruit, retain and advance people of color and women. Those efforts led to the creation of a role that would hold the company accountable to its diversity commitments, and by summer, recruitment was well underway.

“We have to have a workforce that is more diverse, because quite honestly our consumers are diverse,” said Paula Erickson, the company’s chief human resources officer.

Adding a chief diversity officer is one step companies are taking after the racial reckoning spurred by the death of George Floyd at the hands of Minneapolis police last May. Frequently, people of color and women are appointed to the roles.

As companies promise to publicly hold themselves accountable, more are detailing their plans. Strategies include recruiting from historically Black universities, enhancing employee benefits like parental leave to increase the number of women in leadership roles and expanding leadership development programs to create a talent pipeline.

Among the 100 largest U.S. companies, 16% of executive-suite positions are held by non-whites and a quarter of executive roles are held by women, according to a 2020 study from Stanford University of Fortune 100 companies.

 

There is growing demand from the public, consumers and shareholders for more disclosure on these commitments, including how effective they are, said David Larcker, a professor at the Stanford Graduate School of Business and an author of the report.

“Where do those people end up, are there real programs to remove biases and are people getting promoted? There is a big push for companies to provide those things,” he said.

Illinois soon will offer a closer look at one measure of the diversity of companies based here. A law that took effect Jan. 1 requires publicly traded companies headquartered in the state to provide information on the gender, racial and ethnic diversity of their boards to the Illinois Secretary of State. The legislation directs the University of Illinois to provide an analysis by March 1 using the data. Originally, lawmakers considered legislation that would have required companies to have at least one woman, African American and Latino on their boards.

So far, 78 companies have provided a response, department spokesman Dave Druker said.

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