Black MBA - Winter 2007/2008 - (Page 26) FEATURE Inside the Corner Office THE CHANGING FACE OF BUSINESS Still, Broussard said she believes it’s important to hold on to as many Black CEOs as possible. “The world is run by business,” she said. “Therefore, policies and procedures that affect African Americans are made by CEOs of large companies. Without an African American in the role of CEO, our concerns and interests may not be met.” Yet even when an African American is in the top spot, Black interests are not always met. In O’Neal’s case, for example, a class-action suit that is still pending alleges that Merrill Lynch systematically restricted opportunities for Blacks to succeed as brokers. According to an amended complaint, of the firm’s more than 14,000 sales people, only 128 were African American as of 2005. Officials of Merrill Lynch have strongly denied that the firm discriminates. And Irvin said he doubts that O’Neal was aware of charges of discrimination until late in the process preceding the lawsuit. “Companies have cultures and they have histories,” he said, “and to assume that just because the CEO is Black, all is going to be made right for other Blacks or others who have been aggrieved by the company is simply delusional.” Besides, he said, corporate America is undergoing a radical if unacknowledged change. “The corporate world, just like the rest of our world, is and will be increasingly made up of non-white people,” Irvin said. “Whereas Stanley O’Neal and Dick Parsons came to their positions in clearly the Black/white paradigm – which in many American-based corporations still exists today – this will not be the framework through which leaders of the future will need to manage and be seen.” Irvin pointed to a Goldman Sachs report indicating that the BRIC economies – Brazil, Russia, India and China – could exceed the combined economies of the G6 – the industrialized nations of France, Germany, the U.S., the United Kingdom, Japan and Italy – within the next 50 years, as measured in U.S. dollars. At this time, of the current G6, only the U.S. and Japan may be among the six largest economies in the world. Change is already under way in major U.S.-based companies. Eighty-one percent of Coca Cola’s employees are based abroad, for example. The same is true for 58 percent of McDonald’s employees, 57 percent of those working for Procter & Gamble, 54 percent of Citigroup, 50 percent of Exxon Mobil and 49 percent of General Electric. “Even here at home, it’s important for Americans to remember that the paradigm of Black and white will be increasingly less meaningful,” Irvin said. “Already the U.S. has the fifth largest Spanish-speaking population in the world – behind Mexico, Columbia, Spain and Argentina – larger than the population of Canada. Within one and a half generations, America will be a nation of majority-minority states, with non-Hispanic whites making up less than 50 percent of the population.” This will have profound implications for African Americans who want to climb the corporate ladder and become CEOs, Irvin said. He notes that Indra Nooyi, a native of India, is president and CEO of PepsiCo, Inc. and that it was announced in December that Muhtar Kent, a Turkish national, will become CEO of The Coca-Cola Company on July 1, 2008. “Blacks will be sharing the spotlight with Asians, Latinos, Indians and everyone else,” he said. “Everyone ethnic or racial will be looking to the C-level suites to see if their groups are represented. There will be no waiting in line, [or] the idea that Blacks should be there first. This will be about brutal global competition in a global economy for who can grow the business.” mba George E. Curry, a syndicated columnist and public speaker, is former editor-in-chief of Emerge: Black America’s Newsmagazine and the National Newspaper Publishers Association News Service. He was a reporter for Sports Illustrated, the St. Louis Post-Dispatch and was a Washington correspondent and New York bureau chief for the Chicago Tribune. creased by 35 [percent] to 40 percent,” Anderson recalled. “Merrill Lynch was doing better than Morgan, better than Citibank – they were challenging UBS. It became a very attractive stock. “That apparently emboldened Stan O’Neal and led him to start making other decisions that were very, very risky, taking them into an area that they had not entered before. They went into hedge funds – that’s risky stuff. Merrill Lynch was a brokerage firm, buying and selling stocks for people. He was taking them into all these risky areas. Then – bang – the subprime problem hit. The values of these securitized CDOs started to go down because investors became very cautious about buying those instruments.” In addition to his loss projections being woefully inaccurate, O’Neal made another tactical mistake. “O’Neal made his second major mistake,” Anderson said, “when he approached Ken Thompson, the CEO of Wachovia, who is on the board of Merrill, about a merger. You don’t raise questions about a merger without informing your board. The guy he approached spilled the beans and Stan had to ‘fess up. Having a write-down of $7.9 billion instead of $4.5 billion and broaching the question of a merger without telling his board left him with no legs to stand on.” In Oakland, Cheryl Broussard has reached the same conclusion. “I knew he was under attack for huge losses and would need to go,” she said. “When you are running a public company, you are under so much scrutiny and the shareholders will generally not give CEOs that lose a ton of money too many chances.” 26 BlackMBA • Winter 2007/2008 • www.nbmbaa.org ©James Leynse/Corbis http://www.nbmbaa.org
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