In 2015, only 2.5% of the directors of Fortune 500 firms were Hispanic. Two years have passed and that percentage has increased—by an unimpressive 0.1%.
According to a new Korn Ferry report, despite many company promises for more diversity, the Hispanic representation still lacks behind both the population spread and the growing consumer clout of the group. In the most recent count, just 142 of the 5,361 directors of Fortune 500 firms are Hispanic, says the report, “Latino Board Representation: Improving or Not?”
“Hispanics are dramatically changing the business and consumer landscape,” says Victor Arias, a senior client partner in Korn Ferry’s Board & CEO Services practice and the report’s author. But he says board representation is low because during and immediately after the Great Recession, boards with openings purposefully looked for former c-suite officers to add to their ranks. Since there were few Hispanics in current or former CEO roles, Arias says, these boards left untapped highly qualified and diverse candidates below the c-suite level.
What’s more, most boards, when seeking to fill openings, initially ask for a representative group of potential directors but pick people who they are most familiar and comfortable with. “It requires a leap of faith, and an intentional commitment to make the kind of change that will diversify a board,” Arias says.
The report suggests that the most effective way to increase Hispanic representation may be for boards to expand their searches. The report indicates how there are many talented Latinos working within government service, on boards of firms owned by private equity, running their own businesses, and serving on non-profit boards. “There are many paths to the boardroom, and companies have a responsibility to explore all of them,” Arias says.
If there is a small silver lining, Arias says, it’s that there is an increase in overall first-time directors, and that many of those first-timers are Hispanic. In the Fortune 500, there were 27 Latinos elected to new seats; 18, or 67% of those, were first-time directors. Similarly, in the Fortune 1000, there were 39 Hispanics elected to new seats; 24, or 62%, were first-time directors.