A growing number of public corporations across a variety of industries will observe Juneteenth as a company holiday. National Black Chamber of Commerce Chairman Larry Ivory joins Yahoo Finance’s On The Move to address corporate responsibility in honor of Juneteenth.
ADAM SHAPIRO: But we want to turn back to what's happening in our country at this moment in history on Junteenth 2020. And to help us understand how we help people who have not always had access to the economic benefits of this country and how we're going to make that possible, Larry Ivory, the National Black Chamber of Commerce Chairman joins us now to discuss that, along with Anjalee Khemlani here from Yahoo Finance. Mr. Ivory, welcome and happy Juneteenth.
LARRY IVORY: Well, it is my pleasure to be on the call with you and looking forward to the conversation.
ADAM SHAPIRO: Let me ask you, I was listening to a discussion in which people were talking about the progress that has been made. But progress is not equality. And it seems at this moment in time, it demands equality. So what does the business community need to do, and what do each of us as consumers of that community need to do to make sure we now get equality instead of just progress?
LARRY IVORY: Well, you know, I think what the corporate America needs to do and what the country needs to do, and I go back to this whole idea of a more perfect union. It was an ideal. And what a more perfect union means is that everyone has an opportunity.
And I think when we take a look at corporate America in terms of what it can do and what it should do, is that we should understand that African-American and black people have been left out economically. And because we've been left out, it has created all kinds of social economic problems that impact all of our lives, from health care to bad health care outcomes, to the lack of access to credit.
All those things have created an environment that makes it very difficult for African-Americans or blacks-- I want to say blacks-- to really kind of be a part of this American system. We can always point to some great athletes or great superstars. We have some successes. But overall, we're still struggling. And we're still not participating in this great economic society that we have.
ANJALEE KHEMLANI: Larry, it's Anjalee Khemlani. And I know that one of the things that has constantly been a focus, especially in the business world, is corporate make up of the C-suite and who is sitting on, not just in those positions, but on the boards. And we've seen a greater response at large from the corporate community, I think this time around, especially if you compare to what happened in 2015, 2016.
But it seems like one of the default actions is throwing money at the problem again. And while that amount has been unprecedented this time around, what else needs to be done, or how else can we hold companies accountable?
LARRY IVORY: Well, I think the biggest thing companies can do is that when you take a look at their spend, I mean, when you take a look at their contracting and their opportunity to do business with African-American business owners, the greatest thing they can do instead of throwing money at a problem, because when the money runs out, then people are right back where they started, what they need to do is create sustainable opportunities.
And that can be done by contracting with black business owners, where they are doing engineering, or professional services, advertising throughout the whole area. We can point to no place in America, on corporations or on municipalities or state agencies, where there's a reasonable portion of procurement opportunities going to African-American businesses across the board. It's simply not happening.
If they do that and allow us a chance to compete-- and we will compete, just we have at every other level-- we will be able to bring value to those companies and corporations. But there's always a way of writing things in such a way that even when we're qualified and we can deliver value, that we still don't get the opportunity.
So corporate America could change this whole thing by simply making an investment in procurement to black businesses in a tune of 15% of their span. Then everything would be 10 times better.
ANJALEE KHEMLANI: One of the other issues is hirings and education. And I think that that is something that a lot of people are looking at, studying still. And so I'm curious, does it help? I've heard some ideas where companies will directly hire and ensure that they're hiring from certain colleges, especially if they are historically black universities. Is there any value in that?
LARRY IVORY: Well, absolutely, because if you hire people who have the experience of being black, there is a greater sensitivity that you can't get if you've got a bunch of corporate white guys sitting on the board who don't really understand the inherent challenges of people who they haven't really spent a lot of time with.
So and when you take a look at the trillions of dollars of spending power that black people have, it makes good corporate sense to have diversity, because adversity creates creativity and gives you a competitive advantage. So it makes good corporate sense. But it surely makes a lot of sense to have diversity of thought on those boards.
JULIE HYMAN: Larry, it's Julie here. What about putting some teeth behind that? There's a really intriguing cover story in "Businessweek" this week about quotas. And the-- I know it's sort of a thorny and at times controversial issue, but California, for example, mandated that there be at least one woman on corporate boards of companies based there. And that kind of thing has worked in that case. Do you think that is what's needed? Are quotas needed?
LARRY IVORY: Oh, absolutely. I think without that, I don't think you're going to get the diversity. Illinois tried the same thing. And it got watered down. The governor, quite frankly, took a look at it. We pushed to make sure that African-Americans were on corporate boards. There were some concerns in reference to was that going to be constitutional, would we have to do it for other people, and was it going to impact businesses?
And my point was it wouldn't. Matter of fact, it woulds show great leadership for us to have diverse boards, because a lot of the institutions, McDonald's and others, had already embraced the idea. So I think it really would make a lot of sense. It would say to America, and I would say to black people, but it would also show the spirit of making a difference, because black people helped build this country based on free labor. They didn't get paid for it.
And we made this country great. And really, there is a law of equal exchange that should be applied. And there should be some corporate sensitivity, where corporations across the board, states across the board, mandate, put legislation in place and make sure that there's diversity in the board. And it makes good business sense, quite frankly. It makes good business sense.
- Larry, how would you measure the success of all of these corporate initiatives that have been put forward in the last few weeks? I mean, it seems like there's a bit of catch up that's happening with corporate America. But you know, the concern is that everybody puts out the statements and puts out the initiatives.
And a year from now, or two years from now, we're right back at the same place. Have you thought about what measures you want to put in place to see how effective these policies have been?
LARRY IVORY: Yeah, I think you always-- if you can't measure it, you know, it isn't real. So I think there has to be some measurements in terms of accountability, you know, in terms of not just the rhetoric or the conversation for the moment. And you ought to tie compensation to it.
When we find that when diversity and inclusion is something that a corporation puts in place, and that has a monetary value, and that someone is accountable to tracking and seeing what's happening, then we find we get better results.
So I think there has to be accountability and compliance put in place. And we ought to see direct result of greater business growth, because in the black communities is that we have a significant number of businesses, but we lack the capacity.
And so we ought to see capacity growing. We ought to see wealth increasing. We ought to see unemployment coming down. All those things would be indicators that it's working. And I'm sure if they make the commitment, we'll see it, and we'll have a better America for everybody.
ADAM SHAPIRO: And Mr. Ivory, the last question that we have for you, your membership, are they hearing from corporate America? Have they shared with you the discussions? And are the kinds of things we've been talking that you've shared with us, talking about, actually in play now? Or is it just talk at this moment?
LARRY IVORY: Well, right now, I would have to say it's a lot of conversation. And we haven't seen direct contact to our national organization or even our chambers across the board. And so it's good conversation. We hope it's real. I'm cautiously optimistic that at this time, corporate America is going to get it. And they'll understand, and they will make the type of investment they deserve to make into our communities.
You know, I just saw the piece where Chase Bank, 80% of their lending were in white communities. They only did 2% lending in Chicago. So you know, it was out of proportion. And that's probably true across the board, so corporate America has got some making up to do. They should do it. It's good for business. Is good for America. And I think we should hold them accountable.
ADAM SHAPIRO: We appreciate your being here. Larry Ivory, National Black Chamber of Commerce Chairman, all the best to you, sir.
LARRY IVORY: My pleasure. Thank you.