When it comes to diversity, equity, and inclusion in the workplace, the C-suite still has a long way to go. While recent advocacy efforts have helped to bring greater diversity to entry-level positions and mid-level managerial jobs, these efforts have not yet impacted the C-suite to any significant degree. Despite plenty of research demonstrating the benefits of a diverse executive team, today’s C-suite remains disproportionately white and male compared with the demographic makeup of the rest of the workforce. To get a better understanding of the situation, read on for a look at some fascinating data on C-suite diversity in the last few years.
1. C-suite diversity isn’t anything like what it should be
The subtitle of the 2020 Diversity in the C-Suite report from the Stanford Closer Look Series, authored by David F. Larcker and Brian Tayan, says it all: The Dismal State of Diversity Among Fortune 100 Senior Executives.
One of many studies analyzing C-suite composition across top companies (in this case the 100 largest US companies known collectively as the Fortune 100), the Closer Look report gives a clear picture of just how far off a diverse C-suite really is. Virtually all its findings demonstrate that women and racially diverse people are severely underrepresented in the C-suite. For example, of the total C-suite positions at Fortune 100 companies, women hold only 25 percent. When it comes to the top job of CEO, women are in this role at just seven Fortune 100 companies. The story is similar when it comes to racial diversity — just 16 percent of total C-suite positions are held by racially diverse executives, and non-white CEOs are found at only 16 Fortune 100 companies.
The story that these numbers tell is reflected in many other studies and analyses. A 2023 report from the Harvard Law School Forum on Corporate Governance, for instance, offers a similar snapshot of C-suite diversity in the S&P100 (the 100 largest companies of the S&P500, which is an index of public companies selected by the S&P Index Committee). Based on this report, only 23 percent of C-suite positions in the S&P100 are occupied by individuals of Asian, Black, or Hispanic/Latino backgrounds, despite these groups making up 37 percent of the entire US workforce. Likewise, although women comprise nearly half (47 percent) of the US workforce, they hold just 28 percent of C-suite positions in the S&P100.
2. Women lose the most ground at the first step up to manager
For nearly a decade, McKinsey & Company, in partnership with LeanIn.Org, has been producing its seminal Women in the Workplace report. A major annual study of women in corporate America, Women in the Workplace highlights some of the key challenges that women leaders are facing on the road to gender diversity in the C-suite. According to the 2022 report, one of the biggest reasons why women are so dramatically underrepresented in senior leadership has to do with what McKinsey calls “the broken rung” at the first step up to manager.
Here’s how the “broken rung” works”: For every 100 men who are promoted to manager positions from entry-level roles, only 87 women and only 82 women of color are promoted. Because men then outnumber women at the manager level, they are more likely than women to be promoted to the next level, thus resulting in gender gaps that get even bigger the higher up the ladder they go — making it virtually impossible for women to catch up.
3. Underrepresented groups tend to cluster in roles not bound for the C-suite (or the CEO role)
When considering gender and racial diversity in the C-suite, it’s important to look not just at how many roles are held by women and/or diverse executives, but also at which specific positions these underrepresented groups find themselves in. Interestingly, and dishearteningly, the report from the Harvard Law School Forum on Corporate Governance found that even when women and diverse executives do hold C-suite positions, they tend to be roles that are not as powerful or influential within an organization.
For example, Black executives see the greatest representation in supply chain roles, while women see proportionate representation in the CHRO seat, but neither of these holds the same influence within a company as COO, CFO, or P&L leadership positions do. In these roles, which are often the ones that feed directly into CEO and board succession planning, women and racially diverse people remain seriously underrepresented. As the Diversity in the C-Suite report further elaborates, across Fortune 100 companies, women hold 38 percent of positions with lower potential for advancement (including general counsel and human resources), but just 13 percent of positions with a high chance of CEO promotion. Likewise, of all the CFOs at Fortune 100 companies in 2020, just four were racially diverse.