The Latino Corporate Directors Association (LCDA) has challenged Corporate America to triple Latino representation on their boards by 2023.
Although Latinos comprise the largest racial/ethnic group in the US, the number of Hispanics on corporate boards remains staggeringly low. “The Latino community is applying pressure because the number of Latinos has stayed exceedingly low and hasn’t changed in a decade,” pointed out LCDA President & CEO, Esther Aguilera.
Latinos hold a mere 2.2% of the board seats among the publicly-traded companies listed in the Russell 3000 Index (August 2020). LCDA’s own 2019 board analysis reveals that 76.8% of the Fortune 1000 companies did not have a Latino on their board. Furthermore, only 23.2% of these firms had one or more Hispanics on their boards, occupying just 2.7% of Fortune 1000 board seats. More shockingly, LCDA’s research has shown that 87% California-based public companies (571 of the 662) have no Latino representation on their board of directors, despite Hispanics comprising the largest population in the state (as reported).
ECONOMIC ENGINE OF THE US
Yet, Latinos are the largest racial/ethnic group in the US, representing around 18% of the population (58 million). This figure is projected to grow on average by 1.2 million a year between 2017 and 2060. Despite the fact that Latino consumers are the “economic engine of the country”, driving growth in every consumer category and representing around $2.3 trillion in GDP, they are being “systematically left out of the boardroom”, confirmed LCDA. It hopes that its recently launched initiative Latino Voices for Boardroom Equity will change the status quo. This initiative aims to:
- Triple Latino representation on public company boards by 2023.
- Act to target corporations with no Latino representation.
- Track progress through publication of a quarterly scorecard.
Many leading business and non-profit leaders have already joined the movement. They include League of United Latin American Citizens (LULAC); UnidosUS; the Mexican American Legal Defense Fund (MALDEF); the United States Hispanic Chamber of Commerce (USHCC); the Association of Latino Professionals for America (ALPFA); and the National Hispanic Media Coalition (NHMC).
This latest campaign makes it very clear that “diversity without the inclusion of Latinos is not acceptable”. “In a country where Latino GDP is nearly 25% of total US GDP growth, no company can be effectively governed without Latino voices on their board,” stated Pat Pineda, LCDA Board Member. “Supply is not the issue. Despite a strong qualified pool, Latinos have long been systematically excluded and bypassed.”
SYSTEMATIC EXCLUSION
Sindy Benavides, CEO of LULAC National, agrees with Pineda. “What we continue to have today is systemic exclusion which is not acceptable in 2020. Latinos are the current and future workforce of America with a growing purchasing power that impacts the bottom line of major corporations across all industries. We are closely watching the actions taken in the corporate boardrooms and will not hesitate to publicly denounce companies who market and profit from our community but fail to include us on their corporate boards,” she warned.
“Latinos were excluded in the push to add women to the boardroom and are being excluded again by efforts solely focused on Black directors,” added Roel Campos, former SEC Commissioner and LCDA Board Chair. “Diversity in America is not black and white. A truly diverse boardroom is inclusive of Latinos.”
Companies that continue to exclude Latinos from the boardroom will suffer dire consequences. “If corporations do not want to give us a seat at the boardroom table, they are going to feel the absence of the buying power of the US Latinx, which is expected to reach $1.9 trillion by 2023,” pointed out Brenda Victoria Castillo, President & CEO of the National Hispanic Media Coalition. “It’ll be time for us to withdraw our money and take our business to corporations that believe, support and uplift our community.”
LATINO INCLUSION
Since 2008, “Latinos have comprised 82% of the growth in the US workforce. Any company seeking growth must look to engage the US Latino community in all facets, as customers, employees, executives and board members,” added Damian Rivera, CEO of ALPFA. “It is irresponsible for companies not to have Latinos included in their Boardroom given those statistics. This should be an easy decision, it’s both the right thing for society and for shareholders.”
UnidosUS CEO Janet Murguia believes that diverse representation on boards of directors is “more than just a goodwill gesture”. “It is good for a corporation’s bottom line since research shows that companies with diverse boards are more successful financially. Given the highly competitive 21st century economy, continuing to neglect a trillion dollar market and the future American workforce is a costly, short-sighted and an unnecessary business decision,” she remarked.
With Latinos comprising over one quarter of all public school students in the US, “public companies must recognise Latino importance, today and tomorrow, as leaders, workers and consumers,” pointed out Thomas A Saenz, President and General Counsel of the Mexican American Legal Defense Fund (MALDEF). “Board inclusion is critical to these companies’ future success.”
Ramiro A Cavazos, President & CEO, US Hispanic Chamber of Commerce (USHCC), agrees. “Latino businesses across the country are supplying value-added goods and services for corporate America and Fortune 1000 public boardrooms would greatly benefit from our business acumen, experience and grit,” he concluded.
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