Two prominent real estate companies have joined over 42 other firms to pledge an increase in the number of Black people on their boards.
Zillow and Redfin both announced last week they would be joining the Board Challenge, a new initiative aimed at helping companies diversify their boards and thus their workforces overall. Other participants include Verizon, the New York Stock Exchange, United Airlines, Lyft and Uber.
Black leaders are underrepresented in America’s public and private boardrooms. Approximately 66 percent of Fortune 500 company board members are white men and 18 percent of members are white women, while only 9 percent of members are Black men and women, according to a report by the Alliance for Board Diversity and Deloitte. And while many companies tout their commitment to improve diversity, equity and inclusion, progress at the boardroom level is limited. According to Black Enterprise, 187 S&P 500 companies, or about 37 percent, did not have any Black directors in 2019 – only a two percentage point improvement since 2018.
A 2018 report from McKinsey & Co. found that diverse boards of directors are 43 percent more likely than non-diverse boards to achieve financial performance above the national industry median for companies in the top quartile versus bottom quartile. And activists argue diverse boards are a necessary component of any company’s efforts to diversify its workforce and ensure its company culture is welcoming to people of color.
Zillow has no Black board members; Redfin has one: Kerry Chandler, the chief human resources officer at entertainment company Endeavor.
As part of taking the pledge, they and the other firms involved commit to progress reports, including six-month and one-year reports. The Board Challenge’s co-founders – Altimeter Capital, Valence and theBoardlist – say they will provide participating companies with access to qualified talent to help in their search and recruitment of Black director candidates, while supporting organizations like the Executive Leadership Council, the NAACP and National Urban League will offer resources and training.
“America has been reminded again in tragic fashion that we must redouble our efforts to build a more inclusive society. Business leaders can’t let this moment pass us by without playing our part and taking this tangible step to build a more diverse boardroom,” Brad Gerstner, founder and CEO of Altimeter Capital and co-founder of The Board Challenge, said in a statement. “As a next step, we are encouraging companies to take the pledge and add a Black director in the next 12 months. The Board Challenge is a movement to accelerate these changes and help companies tap into the energy and talents of all underrepresented groups.”
