They've got the power. The 40 men and women featured on these pages are among the most influential players-black or white-in corporate America today. Masters at marketing, innovation and manufacturing, these executives stand behind products ranging from computers and trucks to mutual funds and chemicals. Indeed, they reach into our wallets, homes and workplaces every day.
Heavy hitters for the nation's largest corporations, these individuals control revenues and budget dollars in the billions. How, they move these funds not only shapes our daily spending habits, but the bottom lines of their companies.
BLACK ENTERPRISE has spent the past five months tracking the high-flying executives profiled in this report. But our search for top talent, in fact has been ongoing since 1988, when we first presented the "25 Hottest Black Managers in Corporate America." In that cover story, we named an elite cadre of managers poised for stardom. Two subsequent articles, "Return of the Top 25" in 1989 and "Power Surge" in 1992, gave updates on their hot-rod careers. Of the original 25, 16 reappear on this list.
Unlike our 1988 roundup, this group of business leaders includes women. Five years ago, black women comprised just 2% of all U.S. corporate managers (the figure is 2.2% today). But in August of 1991, our groundbreaking story "21 Women of Power and Influence in Corporate America" identified a dynamic troupe of women achievers. Four of them made the cut for our story.
The "Power 40" named in this issue were selected with the help of BE's vast network of executive recruiters, human resources specialists and professional organizations, such as the Washington, D.C.-based Executive Leadership Council. BE readers, too, over the years,have alerted us to some stellar managers. Armed with these and other leads, we requested nominations from the nation's biggest industrial and service companies, including those we recognized as the "25 Best Places for Blacks to Work," in February of last year. Our efforts yielded more than 100 impressive candidates. The BE Editorial Board made the final list selection.
So why 40? Back in 1988, says the Bureau of Labor Statistics, 4.9% of the nation's managers were African-American. Five years later, our ranks have not dramatically increased: In 1991, the last year for which these statistics were available, 5.1% of all managers were black. But while executives of color may lag in number, a significant handful have captured more clout. This brings the threshold of black talent to an all-time high. In fact of the 25 we featured in 1988, most have since seen promotions (others switched to privately held or foreign companies and, therefore, no longer qualified for the list).
As they scale new heights, we found, more blacks are getting a shot at profit and loss responsibility. Says Howard Bond, president of Executech Consultants Inc., an executive recruitment firm in Cincinnati: "Those who have proved to corporations that they can do an outstanding job have really provided an opportunity for others to follow in their footsteps."
Though the recession has forced a disproportionate number of black middle managers out the company door, highly ranked African-Americans appear to have suffered far less. According to Pittsford, Vt.-based Gilbert Tweed Associates, a leading international executive search firm, 35% of top-level corporate placements in 1992were either black or female, compared with a mere 5% in 1981. The salary range for these positions? A healthy $100,000 and more.
"This isn't a quick fix," insists J. Al Wakefield, a partner at Gilbert Tweed. "Companies are trying to make changes reflective of the market as a whole," which will be a nonwhite majority by 2000. In fact, most of the executive recruiters we consulted predict that BE will present an equally strong list of 100 "Most Powerful Executives" before 2000.
How We Selected Them
For consideration, candidates had to meet several requirements. They must work for publicly traded corporations in a senior capacity (all but one work for Fortune 1000 companies). In particular, we looked for those managers who have bottom-line impact. Of course, salary, too, was an issue. Each individual on our list earns a compensation package of no less than $250,000. (This includes base pay and short-term bonuses). The majority make salaries in the $300,000 to $400,000 range; the most highly paid individual brings home a whopping $1.8 million.
The cutoff for our 1988 "25 Hottest Black Managers" list was also $250,000. That sum, however, included pension plans and all stock options. According to Judith Fischer, publisher of Executive Compensation Reports in Alexandria, Va., the upward spiral in executive pay came to a halt at the end of the 1980s, and in 1993, more than half of all companies are expected to freeze wages across the board.
A Special Brand Of Talent
Racial obstacles aside, several of the people on our list have broken barriers of gender and age. Take Dorothy Terrell, president of Boston-based SunExpress, a division of Sun Microsystems. One of the few executives with a liberal arts background, she rose to become a plant manager at Digital Equipment before joining Sun Microsystems--a truly stunning career coup for any female executive. According to Catalyst, a New York City-based women's research and advisory group, only 9% of female managers ever crack that field.
Another anomaly is Richard Nanula. At the age of32, Nanula is a full 15 years younger than the average executive on our list--yet he is one of the biggest power brokers. The CFO of the $6 billion Walt Disney Co., Nanula is sixth in line behind chairman and CEO Michael Eisner. Within months on the job, he pulled off the largest convertible bond issue ever, a deal which helped finance Euro Disney.
In an age where senior managers are unceremoniously ousted, New York-based Teachers insurance and Annuity Association--College Retirement Equities Fund (TIAA-CREF) has refused to let its chairman go. CEO Clifton R. Wharton Jr. was set to retire at65, but he stayed on at the board's urging. Today, at 66, he is one of the oldest CEOs in corporate America.
Where They Sit
Among the executives, 12 are presidents of major divisions or subsidiaries. The two CEOs on our list? Richard Parsons of the Dime Savings Bank of New York and Wharton of TIAA-CREF. Parsons, a former lawyer, today heads the seventh-largest savings institution in the United States, with assets of $9 billion. Wharton is at the helm of the world's biggest pension fund, which has assets of $112 billion.
Currently, there is not a single black CEO among the nation's largest 500 industrial corporations. Our list, however, does contain a few hopefuls. Xerox veteran A. Barry Rand is a member of his company's power quintet and is an obvious contender for the top job. Others tantalizingly close to the CEO's seat include Robert Beavers of McDonald's and American Express' Kenneth Chenault.
Only three of these top-drawer executives occupy director chairs at major companies other than their own. Not surprisingly, the two CEOs--Parsons and Wharton--command the most clout outside their organizations. Parsons serves on the boards of two giant conglomerates: Time-Warner and Philip Morris; Wharton is a director at Ford and the New York Stock Exchange. Xerox's Rand also sits on the board at Honeywell.
What Else We Found
* Tech Wizards Reign: As this entire month's issue underscores, it's not just the job you've got that matters, but the industry you're in. And our executives, we found, are centered in some of the hottest fields. Blacks who got their start in technical industries, especially, have excelled. Whereas performance in areas such as sales and marketing may be subjective, technical proficiency can't be denied.
It's no surprise, then, that five of our executives have careers in the telephone industry; another six work for computer firms. Telephone companies in particular, points out Howard H. Bond, started aggressively recruiting blacks as early as the '70s, "because they have been under close government scrutiny" to do so.
* The Biggest and he Best. The largest corporation represented on the list is also the nation's biggest industrial firm: $124 billion General Motors. The company brass recently named Roy Roberts as vice president and general manager of GMC Truck, making him the first African-American to head a Big Three auto division. proved most popular? With three executives each named in our story, Xerox and IBM tie for the honor. Both companies boast management teams that are more than 12% black.
* Degrees Galore. More than half of the men and women on our list sport MBAs or similar advanced degrees. Stack that against the credentials of the nation's top 1,000 CEOs: Only 23% from that club ever picked up comparable letters. When questioned on this topic, most executives said they viewed the MBA not merely as a resume flourish, but as a means of withstanding tougher-than-usual job scrutiny. Monsanto's David Price, for instance, names the day he earned his Harvard MBA as the turning point of his career. "Until then, a lot of things I wanted to do were just dreams," he says.
The Ivy on our list is plentiful, too. Fourteen of the 40 received at least one degree from an Ivy League school. In addition, 10 were educated at historically black institutions.
* A World of Opportunities: Today's global economy demands a spate of world-savvy managers. And the majority of executives, we found, are gaining experience in markets abroad. Now more than ever, points out Derryl Reed, past president of the National Black MBA Association, "international experience is necessary" to ensure a nimble corporate climb. This especially holds true as lucrative markets in Africa and South America open up. Says Reed: "Who better to help make the connection with (these nations) than businesspeople of African descent?"
Carl Ware is definitely one. Truly a...