What Corporate America Should Learn From Ferguson, Missouri

Companies need to recognize that there is a bit of Ferguson in many of their management ranks, boardrooms, and stores that needs to be eradicated for the well being of their businesses and the people they serve.
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The racial tensions in Ferguson, Missouri ignited by the shooting of unarmed black teenager Michael Brown have captured the nation's attention and opened conversations across homes, workplaces and boardrooms that are often difficult. For the five decades since the race riots of the 1960s, tensions grew in Ferguson, finally erupting two weeks ago in mass demonstrations and civil unrest that brought to the fore the problems of systemic racial conflict in all sectors of American society. But more than the protests, or even the killing of Michael Brown, the militarized stance of the police toward American citizens has opened wide the fissures of race relations.

A suburb of St. Louis, which, according to the 2010 U.S. census, is the ninth most segregated city in the United States, Ferguson has long been a placid, all-American town. With a majority African American population, Ferguson, in addition to St. Louis, escaped both the civil rights era race riots, and the overt racial tensions that have polarized the nation since, owing to an ingrained culture of civil obedience that decried public protests. There was an unspoken understanding in Ferguson that left issues of race muted, even as they simmered. So the news that Michael Brown had been killed by a white police officer shocked the conscience of Ferguson's African American community, which finally protested, permitting a decades-old communal outrage and hurt over racial mistreatment to explode with such force that it shook the nation.

Ferguson is not alone in our nation, and neither are its issues confined to cities. Many companies have adopted diversity strategies reminiscent of the Ferguson police department: Keep minorities pacified but disengaged from the process of meaning-making; promote just enough minorities not to be deemed racist; and silence discord. Corporate America, and the nation as a whole, mirrors Ferguson in its avoidance of serious conversations about race, prejudice, unconscious bias, and microaggressions that harm morale and productivity. Companies prefer to ignore "climate" issues that indicate racial discontentment, adopting instead an "ignore it until it goes away" strategy that ultimately leaves them unprepared to countermand the racial bias that weakens their organizations. As a consequence, these companies are more vulnerable than ever to the sort of race discrimination lawsuits that have tarnished Bank of America, Merrill Lynch, Wal-Mart, Macy's, and Abercrombie & Fitch, all of which have lost or settled race bias claims brought against them by their employees and customers.

The "Corporate Diversity Report," produced by the United States Senate, indicates there is much room to improve in racial representation at all levels of corporate America. According to the report, when it comes to corporate boards, Hispanics, who make of seventeen percent of the U.S. population, have one of the lowest representations at three percent of boards and three percent of executive teams. While African Americans, who are thirteen percent of the U.S. population, fare better in board representation, garnering eight percent of board seats, they are only four percent of executive teams. These dynamics are not significantly different from those of Ferguson, where African Americans have no representation in City Hall or on the school board, and are effectively shut out of public safety jobs.

Companies should learn four lessons from Ferguson:

1. Racial tensions do not disappear by not addressing them. They simmer just beneath the surface until an event happens that disrupts conformity to corporate norms and then they erupt.

2. Just as there is no "great white hope," there is no "great black hope" -- whether it's President Obama, Missouri State Highway Patrol Captain Ron Jackson, Richard Parsons who replaced Donald Sterling at the L.A. Clippers, or a company's "chief diversity officer." Racial tension abates when issues are addressed openly and self-reflectively.

3. Poor performance on issues of race is harmful to a leader's credibility and erodes the trust constituents have in the leader.

4. The costs of suppressing racial tensions are far greater than the costs of addressing them.

The reality is that companies want a shortcut to positive race relations. When it comes to issues of diversity, companies generally do not want to hear bad news or admit their complicity in adding to the climates of distrust and bias. Yet, the only way for companies to truly get beyond race is to weed out racial bias continuously.

What should companies do? Here are six strategies.

1. Reaffirm their commitment to diversity through active engagement of minorities in the areas of corporate strategy, positioning, and revenue generation.

2. Convene internal, structured, "safe-zone" conversations led by senior executives about race and culture that permit employees to articulate and work through their concerns.

3. Implement company-wide training on "unconscious bias" and "microaggressions" to help employees be aware of the hidden prejudices they hold that could undermine them and their companies.

4. Develop a broader understanding of diversity that permits the company to move beyond the isolationism of race to a more inclusive paradigm of "excellence."

5. Recognize that diversity is not about "them versus us," nor is it black and white. Diversity is excellence expressing itself as differences, similarities, complexities and tensions. Integrate excellence across all business units rather than sequestering it in human resources, and hold executives accountable for its continued development.

6. Rather than thinking of diversity as "the elephant in the room," try seeing diversity as the room. Diversity is central to everything a company does -- from people management, to process design, to market segmentation.

While we will not likely see racial protests in corporate C-Suites as we did on the streets of Ferguson, we will see more race-based lawsuits in light of admissions by companies that "unconscious bias" has for years caused their hiring managers to discriminate against African American and Hispanic job candidates. Companies need to recognize that there is a bit of Ferguson in many of their management ranks, boardrooms, and stores that needs to be eradicated for the well being of their businesses and the people they serve.

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