Thursday, July 30, 2009

The New CEO of Xerox: When it Comes to Employment Discrimination, African American Executives May Not Make a Difference

For the first time in American history an African American woman became CEO of a Fortune 500 company. Ursula Burns took over Xerox on July 1st, 2009. Her rise to the top of a major U.S. corporation is one of several exciting firsts for people of color in America. This year the first African American U.S. Attorney General was appointed by the first African American president, and Judge Sonia Sotomayor will be the first Latina confirmed to the U.S. Supreme Court. Marc Morial, President and CEO of the National Urban League , compared Obama, Sotomayor, and Burns. All three were raised without fathers, and their success is the result of a hard-earned meteoric rise from the economically-modest family lives into which they were born.

U.S. corporations like Xerox are microcosms of American society and culture. Xerox, like other American companies, reflects American life. Comparing Xerox and the nation invokes another comparison between Burns and Obama. Their success has convinced many that racism and discrimination are no longer serious problems in the U.S. This is reflected in two comments to an article about the new Xerox CEO. One commentator wrote than “many roadblocks” were “taken down” with Burns’ appointment. Another wrote, “Thank you Ms. Burns for clearing the path for my daughter.” And, of course, as far as President Obama is concerned, Americans have engaged in a protracted debate about whether his election proves that we now live in a post-racial society.

Another comparison - President Obama took over an extremely troubled nation, and Burns took over a very troubled Xerox. In an hour-long lecture at the Whitman School of Management in 2008, Burns talked about the need for good corporate citizenship and she described Xerox as a great place to work. Burns also discussed the fact that Xerox had been a troubled company, and she enumerated the ways the company has attempted to address those troubles. She revealed that senior management worried about “every detail” related to some of the troubles the company faced in recent years. At Xerox, “it’s all about the people” she said. “We love difference.” She described the company’s corporate climate as a culture of diversity, mentioning the usual laundry-list of diversity concerns – age, sexual orientation, gender, race and religion.

During her lecture, Burns talked very briefly and superficially about diversity but she was careful not to mention the “D-word” – discrimination. This is surprising because she said that Xerox managers worried about the details that got them into trouble in recent years. One of those troublesome details should have included the corporate climate that led over one thousand African American sales representatives to file a race discrimination suit that had been settled just months before Burns’ speech. Even though Xerox “adamantly” denied wrongdoing, the company paid twelve million dollars to 1,100 African American sales representatives who alleged race discrimination in promotion, pay, and the assignment of sales territories. Some plaintiffs also complained about blatantly racist comments, and the plaintiffs’ expert proved a “statistically significant disparity between the earnings of black and white salespersons at Xerox.” The company’s response to this was that the disparity was the result of “inferior performance.”

Burns never mentioned the race discrimination class action in her speech at Whitman. I cannot find any reports that include any comments she may have made about the litigation, the settlement, or the issue of race discrimination at Xerox. Perhaps Burns agrees with commentators who assert that the U.S. is now post-racial and that roadblocks or impediments that impede the professional advancement of people of color no longer exist. But disparities in income and promotion rates belie the conclusions that racism is no longer a problem, and so do the number of complaints about race discrimination filed with the Equal Employment Opportunity Commission and in courts. Every day life in America for most people of color establishes that racism persists.

Xerox’s response to the race discrimination class action – adamantly denying all allegations and blaming pay disparities on the inferior performance of hundreds of African American sales representatives – ensures that very little will change for the company’s employees of color. Because corporations are microcosms of society in which racism persists, it is very unlikely that there is no discrimination within a company that employs thousands. Even though a task force was established as part of the settlement, it is not likely that things will improve as far as discrimination is concerned if the discrimination problem is not discussed or even acknowledged. Things certainly cannot improve if corporate leaders do not even mention the persisting problem of discrimination.

Burns and other corporate leaders are willing to talk about diversity but are silent about discrimination. In a law review article, I wrote about the important difference between discrimination and diversity. A company that focuses only on diversity efforts, without considering the persistent problem of discrimination, will inevitably and predictably face complaints from, and possibly litigation brought by, employees of color. This is so because American corporations are part of a society that has not eradicated race discrimination. Diversity efforts will increase the numbers of people of color in a corporate workplace, but diversity efforts, without anti-discrimination efforts, make it more likely that the company will have to litigate or mediate disputes about discrimination.

Before Ursula Burns at Xerox, only seven African Americans have served as CEO of Fortune 500 companies - all of them male. None have spoken out against societal or corporate race discrimination. As far as corporate race discrimination is concerned, very little seems to change when the CEO is Black.

The fact that Burns failed to mention discrimination in her 2008 speech that was given just months after Xerox settled a race discrimination class action inspires yet another comparison to President Obama. He too has seemed reticent to talk about race and racism. For example, when asked to comment on the disproportionate impact of the economic downturn on African Americans and Latinos, President Obama’s typical response is that things will improve for people of color when things improve for all Americans, regardless of race. But his answer ignores the many types of economic discrimination that impede the economic advancement of Americans of color. For example, in the years leading up to the current economic downturn, African Americans and Latinos were targeted for predatory loans. Even middle-income African Americans and Latinos were targeted and offered subprime mortgages even though they were creditworthy, and even though similarly-situated white borrowers received prime loans. There is discrimination in retail sales also. African American and Latino consumers pay more for cars, and receive inferior service in many retail stores. And, recent unemployment rates for African Americans and Latinos are significantly and disproportionately higher than the unemployment rate for white Americans.

Look what happened when President Obama did speak explicitly about race. Negative reaction to the president’s comments about the arrest of Professor Henry Gates in his own home eclipsed his attempts to reform health insurance. And, Judge Sotomayor’s “wise Latina” comment in speeches made before her nomination caused some delusional conservatives to call her a racist. These are symptoms of a society in which the discourse about race is frustratingly pallid. No wonder Burns and most African American CEOs stay away from the topic of race.

12 comments:

  1. Prof. Wade has has presented a clear analysis of the dangerous waters we tread when it comes to discussing diversity vs. discrimination. Psychologically, diversity can be viewed as pro-active and have a positive impact in the work place. Discrimination, historically carries a negative connotation on both the victim and the perpertrator. We may be hardwired to avoid pain when possible, but as Prof. Wade points out, diversity cannot be successfully accomplished without visiting the ugly realities of discrimination.

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  2. Work life at U.S. corporations most certainly reflects the microcosms of American society and culture. While simultaneously hiring and promoting people of color to high level and executive positions, discrimination complaints based on race, gender, or national origin are regularly filed against corporations; notwithstanding corporate efforts to increase diversity.

    Professor Wade’s comments on Ursula Burns raises several questions on what should be reasonably expected of executives of color working in corporate America. How should Ursula Burns, the CEO of a Fortune 500 company, publicly respond to discrimination complaints against the company?

    As a practical matter, Ms. Burns more than likely received advice from litigation lawyers (some of whom I hope were people of color) not to make any public comments on the discrimination litigation. After all as CEO of a public company, Ms. Burns is under a duty to act in the best interests of the corporation and its shareholders. Any comments on pending or settled litigation might easily impact the litigation or the terms of an agreed settlement.

    However, Professor Wade’s comments go to a deeper issue for executives of color. Executives of color not only face the scrutiny of media, boards, and financial markets on their ability to achieve financial success for the company, executives of color must also satisfy the expectations of communities of color. Communities of color rightfully expect “their” executives to care about issues of discrimination. Ursula Burns likely experienced discrimination, prejudice, and wrongful treatment on her heroic rise through the ranks of Xerox. The fact that she does not speak out on a particular discrimination complaint against Xerox does not mean she is unaware or uncommitted to ending discrimination at Xerox. No one person, not even a powerful African-American woman who is the CEO of a Fortune 500 company, can bring about larger societal changes on a grand scale [hence the difficulties our President faces on issues of race]. Ms. Burns not only deserves the respect and adoration of communities of color (and women), she also deserves our understanding as she serves her corporate task masters and the communities of color I’m certain she so adamantly loves.

    Although, it may well be true that very little changes as far as corporate race discrimination is concerned when the CEO is African-American. Any CEO who tolerates racial disparities in a company deserves to face litigation and criticism from all of us. The achievements of small numbers within a racial group (diversity) do not equate to wider societal equality (discrimination). However, the achievements of a few begin to increase the numbers represented in corporate America. One day Ms. Burns will not stand alone as the first or only female African-American CEO of a public company. She will stand with many who together can take on corporate task masters while publicly standing for communities of color.

    Z. Jill Barclift
    Associate Professor of Law, Hamline University School of Law
    zbarclift@hamline.edu

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  3. Too often when a person of color, either male or female, enters the executive level of a corporation or government entity, they never openly discuss race or discrimination nor do they actively promote other persons of color. Although I understand their silence as fear of being identified as biased, the executives that preceded them have not let that repercussion curtail their choices. White males typically promote white males; it is the exception when they do otherwise and that exception is the result of litigation. Perhaps if executives of color had the courage to discuss the implications of historical racism and also actively promote those who look like them, then people of color would be less victimized by economic discrimination.

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  4. Let's keep it simple "birds of a feather flock together", "association breeds assimulation". We can find prejudice and discrimination in every walk of life, even our own home. It is rediculus to think that one group will not discriminate against others. It is prudent that we stay vigilant and protect ourselves against it, but is is foolish to think that we will eliminate it.

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  5. Professor Wade makes a good point. Ms. Burns, like President Obama, face an unusual world where you would think that having diversity in the top office would increase the chances of having a "real" dialogue on race. However, the trailbalzers are chilled and are unable to have any honest discussion of race or race discrimination. So it appears that having a black CEO or black president just makes us feel good about racial progress but leaves us frozen in place. It allows people to say that there has been progress without really making any real progress for the average black person.

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  6. It is extremely gratifying to see people of color moving into high-powered positions. Yet, we should not expect too much from these second generation trail blazers. Unlike MLK or Thurgood Marshall the people walking through these newly opened doors must prove themselves trustworthy to the governing elite. Thus making waves regarding race is apt to cause suspicion and rancor that can have negative career implications. Then there is the issue of cognitive capture. Michelle Obama's Princeton thesis is a wonderful analysis of this dynamic. She suggested that after four years at Princeton she finds herself "striving for the same goals" as her white peers. And, her commitment to serving minority communities waned to that extent.

    We all struggle with these issues at one level or another and we all are tempted to one extent or another to conform in the cause of success.

    Perhaps the next generation is the real hope and perhaps they will realize that a post-racial America is impossible unless the nation truly seeks to remedy continuing sources of racial and class oppression.

    It is disappointing that the mainstream consensus on race is to do nothing, and that the rise of people of color serves to affirm that rather than to contest it.

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  7. professor wade offers analysis of a very real conundrum faced by successful executives of color. that said, when i discuss corporate diversity and board of director diversity with my business law classes, one common response i receive from students is the following:

    when individuals rise to the highest levels of leadership in corporate america, by the time executives of color arrive, they have coopted the "corporate" mentality that seems to pervade U.S. executive thought.

    i.e., corporate greed is corporate greed, regardless of race, ethnicity, experience, etc.

    i wonder how much assimilation into corporate America must occur for successful executives of color before they are able to rise to the upper echelon of leadership. and, is it a valid criticism to say that corporate America and Wall Street essentially share a common mind set of profit at all costs, particularly personal profit?

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    1. I do agree that a corporate CEO mindset is consistent regardless of race, color or gender. In order to get the position they receive, they will have had to assimilate into the culture of executives and seem to lose many of the qualities they once understood like being raised by a single parent or living in the hood.

      Diversity double speak are still pervasive today. In 2011 and 2015 racial discrimination lawsuits were still occurring. In December of last year, Burns stepped down as CEO, yet remains on the BOD. Xerox chose to replace her with Jeff Jacobson a fair-skinned white man. From what I've been able to find, it looks like he has only been with the business for 5 years. Nowhere in the announcement put out by Xerox did they mention continuing diversity or opportunity, which I find a clear message.

      In an interview this past February stated that business is made for men. While the gender issue is a whole new can of worms, I do agree with her assessment. While it is possible for women to succeed, the structural set up of business makes for many more hurdles women must overcome or sacrifice that men rarely do.\

      Jessica

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  8. This is a thought provoking post. Thanks prof wade for writing it. I too am disappointed that people of color who become leaders are not more vocal about race discrimination.

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  9. The term post-racial seems a bit suspect to me. Is it really something that we should be striving for? Does it mean that race no longer matters, or does it mean that race no longer exists? We are told that we have arrived at this era because a small percentage of non white people seem to have broken through to positions of wealth and power.
    The price that the upwardly mobile person of color must pay to live in the post-racial era is to have to stifle any observation of the ongoing significance of race. This for fear of rocking the post-racial boat of racial (post racial?) harmony.
    "Post-racial" is a very fragile state of affairs, then. Is it really a desirable one? It reminds me of times when white friends and colleagues have seemingly complimented me (an African American woman) by saying they do not see race when they look at me.
    Is this really desirable?

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  10. This could not be better news. It's really about time this nation realized that color has nothing to do with intelligence and the ability to run a company. Obviously President Obama has been a major reason for the transition, but it is nice to see corporations doing their part to change America. Growing up in the South I experienced a lot of racism and prejudice and unfortunately there is still a lot of that going on everywhere in America, so it's refreshing to read this!

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  11. Diversity is a word that has been shunned in American history since the days of affirmative action. When diversity has been used in the educational arena law suits have followed(Regents v. Bakke; Grutter v. Bollinger; Gratz v. Bollinger...) Why would it be any different in corporate America? The elephant has not left the room.

    It's also amazing to see that when the d-word is used, most often there is resentment from the masses who reverse the comment to say the speaker is racist.

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