Asian Divide in the C-Suite

September 17, 2015 12:57 pm

By Barbara Frankel

Photo by Shutterstock

Photo by Shutterstock

Asian Americans are twice as likely to have a bachelor’s or graduate degree than most Americans. Their median income is 38 percent higher than all Americans.

So why isn’t there a stronger presence of Asians in the C-Suite and senior levels of U.S. management? It’s a question that has concerned community leaders, who see Asians often stereotyped in technical or individual-contributor professional positions.

“It hasn’t really changed. There’s the assumption that Asians are doing much better than they really are when it comes to senior leadership,” said Linda Akutagawa, President and CEO of LEAP (Leadership Education for Asian Pacifics, Inc).

Despite the publicity surrounding Asian CEOs at companies like Microsoft and DiversityInc Top 50 No. 6 Company Mastercard, where Ajay Banga is the CEO, the numbers are disappointing.

While the Asian-American population is rising (currently 5.2 percent of the total U.S. population, according to the Census Bureau, and expected to be 9.6 percent of the population by 2060), the leadership percentages in corporate America have not reflected this change in the past decade.

DiversityInc Top 50 Companies for Diversity and Top 10 companies do fare better than other companies, the percentage of Asians at the top remains small compared proportionally with their educational accomplishments.

Asians in Leadership

Management Senior Execs CEOs Board of Directors
Top 10 14.8% 5.7% 10% 8.1%
Top 50 10.6% 5.4% 2% 4.8%
U.S. (EEOC) 5.9% 4.6% 2% (Fortune 500) 2.6%

(Alliance for Board Diversity)

Barriers to Moving Up

Stereotypes about Asian Americans work in their favor when being hired, especially at entry-level jobs, Akutagawa said, but hurt them when it is time to look at who moves into senior management.

“The perceptions about Asians is that we are hard-working, loyal team players with good technical skills,” Akutagawa observed. “That usually plays well when people are hiring at the entry level. But when you get into management, it’s more about soft skills, political savvy, the weeding-out process.”

She notes that when companies look at performance reviews, they may be rigid in their assessment of management skills.

“Are they allowing room for different leadership behaviors that can be measured? For example, people will say someone has to be a good communicator,” Akutagawa said. “What does that mean in this particular company? Is it someone who talks a lot? Someone might not be a talker but might be able to relay info to teams well anyway.”

South Asians, especially Indians, have had more success moving into management than other Asian Americans, even though Chinese Americans represent the largest Asian group in the United States.

One of the reasons, Akutagawa speculated, is that South Asians, especially Indians, usually learn English as a predominant language because their home country is a former British commonwealth. This may give them an advantage in communicating in U.S.-based corporations.

What LEAP — and Top 50 companies — offered three best practices to develop more Asians in high potential and leadership programs:

1. Assess criteria for management potential and give honest feedback. A handful of companies, such as TD Bank, 39 on the Top 50, are moving to having honest and open conversations with employees. “You have to give people hard feedback and help understand choices — and moving up in a way that allows them to be authentic,” advised Akutagawa. “Are those being groomed for senior executive levels the ones that reflect the styles of what your senior executives want to see in their leaders? Are they open to Asian Americans who have their own different leadership skills? Or are they being excluded inadvertently or unconsciously?”

2. Rely on mentors and sponsors. Those on the path to leadership development need mentors and sponsors from similar and different backgrounds who can help them understand how best to fit in with the corporate culture.Discussing high potentials, Tori Farmer, National Director, Diversity and Corporate Social Responsibility, KPMG, No. 18, said: “They make themselves mentor and sponsor ready. … They avail themselves of mentoring, coaching, leadership development, and managing career-life strategies.”

3. Force the Rooney Rule. When numbers are disappointing over time, companies that lead in diversity often use the same process as the NFL: insist that there is diversity in every slate. The rule is named after former Pittsburgh Steeler Dan Rooney, who was chairman of the league’s diversity committee. Too often, though, companies say a “diverse slate” means a woman and person of color. If the gap is for Asian Americans (or any group), that group should be specified more in requiring the slate, said Akutagawa.

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