Women and Diversity
As I viewed an interview with Nicole Cober, who is a member the National Women's Business Council in the United States, it made me think about the state of diversity in the corporate world, with a focus on women in leadership roles and ethnic diversity. As a new entrepreneur, it also made me curious about diversity in the world of start-ups and women-owned businesses.
Cober emphasized that diversity starts at the top. “One thing is to really look at who is sitting (at the top) and who is making the decisions. Does that boardroom and the decision-making team reflect the diversity of America?” she commented. She added that there are a growing number of women entrepreneurs and that this trend is important to having more diversity in the marketplace. Women in general and women of different ethnic backgrounds are “not only asking for a seat at the table but creating a table of their own”.
The brief statistics below create a compelling case for the need to take action. Some practical tips are also provided to help build better gender and ethnic diversity.
The need to build a pipeline of diverse talent
For several years, companies have actively driven initiatives to address diversity in the workplace. While progress has been made, more can be done to develop a pipeline of women for leadership roles and encourage women of diverse ethnic backgrounds to be represented in leadership ranks.
A report by Leanin.org found that women in the U.S. workplace are underrepresented at all levels. The biggest obstacle that women face is the first step up to manager, or the “broken rung,” which result in significantly fewer women to advance to higher levels.
Furthermore, a Mercer study highlights that the diversity challenge for both women and men starts early in the career, with ethnic minorities not advancing at the same rate as their white colleagues. Within the U.S. working women population, 81% of women in executive roles are white, compared with 8% Asian or Pacific Islander women, 6% who are Black, and 3% who are Hispanic.
Women owned businesses are ethnically diverse
Did you know that across 59 countries, approximately 231 million women are starting or running a new business?
Women-owned businesses are significant contributors to economic growth. According to a report by American Express, 42% of all businesses in the United States or nearly 13 million businesses are women-owned – employing 9.4 million workers and generating revenue of $1.9 trillion.
About half of the U.S. women-owned businesses (an estimated 6.4 million) are led by women of diverse ethnicity/women-of-color, employ 2.4 million people, and generate $422.5 billion in revenue (23% of total women-owned businesses’ revenue). By providing more access to capital and other support, these businesses could generate 4 times as much revenue.
In the United States, women of color represent 39% of the total female population yet account for 89% of the net new women-owned businesses per day (1,625) in 2019. African American women are leading the charge representing 42% of net new women-owned businesses, which is three times their share of the female population (14%). Latina/Hispanic women represent 31% of all net new women-owned businesses, which is nearly double their share of the female population (17%).
More can be done to build a pipeline of diverse talent in the corporate world – at all levels, not just the C-Suite. In addition, more can be done to support women entrepreneurs who are economic powerhouses as business owners and consumers.
Call to action
Beyond the corporate diversity programs, some practical ways that we can take as individuals to accelerate diversity at work and in our everyday lives, include:
Sponsor more women at all stages in their career development, serving as a mentor or career advisor
Women stepping up to advocate for other women in the workplace
Hire more diverse talent (both women and men) and encouraging diversity on team projects
Buy products and services from diverse women-owned businesses
As parents, encourage girls across ethnicities to pursue Science, Technology, Engineering, Arts and Mathematics (STEAM) education and entrepreneurial endeavors from a young age.
Photo: By IKO-studio | Shutterstock
Sources: CNBC. Companies are making bold promises about greater diversity, but there’s a long way to go. 11 June 2020. Score.org. How are women business owners faring these days? 24 March 2020. Leanin.org. Women in the Workplace 2019. American Express. The 2019 State of women-owned businesses report. Cheddar.com. Creating Change and Promoting Diversity in the Workplace interview with Nicole Cober, member of the National Women's Business Council.