Celebrating Hispanic Heritage Month. Why it is Important?

A growing and diverse population

The 2020 Census shows Latinos have and will continue to dominate population growth in the US, and by 2060, they will reach almost 33% of the population. Unfortunately, representation at the C-suite and board level lags behind. The Center for Employment Equity notes that only 4% of executives are Latinos, even less are Latinas. Meanwhile, the Latino Corporate Directors Association shared that in 2020, only 16 S&P 500 CEOs were Latinos and only 2.7% of Fortune 1000 company board seats are held by Latinos. 

A principal factor contributing to this dissonance is the homogenous perception of this demographic. As Ozzie Gromada Meza, Associate VP, Member and Talent Services notes, many companies “don’t know where to look because they don’t know what Latino is.” The Latino/Hispanic community in the US is the most racially diverse ethnic group, with 32.7% currently identifying as multiracial according to the Census. Understanding and celebrating the rich diversity within the population is the first step to help address barriers to access the C-suite and boards.

Why you should pay close attention

In 2018, US Latinos GDP totaled $2.6 trillion, surpassing the GDP of the eighth largest economy in the world. While representing one of the largest audiences nationwide, the Latino market potential is often overlooked. Companies like AT&T and Citrix understood early on and developed strategies, not only externally but internally built adequate representation on boards and at the C-suite level. Today, Citrix’s Latino employees make up 16% of its workforce, 14% of its people managers workforce and 9% of leadership, and AT&T’s Latino employees make up 15.9% of its workforce and 12% of its US management workforce. As Adriana Mendizabal, Group President of Stanley, Black & Decker points out, Latinos “have brought a completely different view to business which sometimes has resulted in completely new sources of growth.”

In addition, laws mandating leadership diversity quotas are gaining traction in the US. Several states are implementing measures, like California AB 979. In addition, the SEC now requires Nasdaq-listed companies to have at least two diverse directors on their board. Companies should plan and develop adequate strategies to attract and retain the best talent today.

Change is happening but a lot needs to be done

Many companies have successfully been addressing their shortcomings in serving the Latino population through Employee Resource Groups and community engagement. For example, P&G recently signed a Hispanic Promise pledge focused on hiring, promoting, retaining and celebrating Hispanics in the workplace, and GM has given over $5.7 million in scholarships for Hispanic students in STEM.  

Despite great efforts taking place, the proportion of Latinos in the C-suite is far from reflecting the make-up of the US workforce. According to the Hispanic Association on Corporate Responsibility, by 2016, the Latino population attrition rate was 20%. High attrition suggests persisting shortcomings in addressing cultural differences in the workplace. As Graciela Monteagudo, Board Director of iHeart Media, WD-40 Company, ACCO Brands, Driscoll’s and Juice Plus+ explains, “often times boards and management will want to improve gaps by hiring without making changes in the culture.” Borja Perez, SVP Revenue Strategy & Innovation of NBCUniversal, tells us that his best mentors are “always aware and focused on the importance of Latino Executives.”

What can companies and senior leaders do?

Begin with developing multi-pronged strategies that go beyond simply hiring Latino individuals. While recruiting is central to supporting diversity goals, it is one piece of the puzzle. Recommendations derived from our experience providing DE&I advisory services and placing Latino talent at leading organizations include:

Groundwork 

• Understanding the Latino demographic will allow you to introduce necessary nuances to your strategies and help you identify Latino talent that may fall outside stereotypes.
• Leadership buy-in is essential. Alignment and support at the outset will facilitate strategy implementation and speed up the process. 
• Assess where your company stands on DE&I, in all aspects of the organization, including boards and governance, procurement, and vendor services. 
• Develop thoughtful and concerted DE&I strategy based on assessment findings and goals. Keeping in mind demographic nuances and high-context culture, integrate Latino-specific initiatives within your overall DE&I strategy. Accountability processes should be integral to your strategy, including at the board level.

Operate change

Common practices include hiring a chief diversity officer, enhancing diversity of the board, ERGs, mentorship and specialized programs, philanthropy initiatives, DE&I training, and inclusive leadership development. Implementing DE&I strategy can be a vast and delicate undertaking. External advisory firms can help you reach your DE&I goals from assessment to delivery and help you avoid pitfalls along the way.

Russell Reynolds Associates is committed to helping you on your DE&I journey, whether through talent hiring or by helping you build inclusive cultures and practices with the help of our DE&I Advisory teams.

A more comprehensive version of this article will be available at russellreynolds.com in October.