MORE DIVERSE and LESS EQUITABLE: API Leadership Pipeline in Large Tech Companies

Buck Gee February, 2024

Introduction

In a May, 2022 report published by the Ascend Foundation, “ASIAN EXECUTIVE REPRESENTATION IN THE FORTUNE 100”, Denise Peck and I analyzed 2020 EEOC workforce data from 65 Fortune 100 companies, finding that higher API diversity was inversely correlated with API executive equity.  The data from the 65 individual EEO-1 reports showed no evidence that higher API Professional representation leads to proportionally higher API Executive representation and, in fact, generally indicates the opposite effect.

That report used 2020 data to evaluate whether APIs were equitably represented in executive ranks and found APIs disproportionately under-represented. In this technical brief, we look at older EEO-1 reports to assess a different question - whether there has been progress over time.  Using ~2014 data from 15 Fortune 500 tech companies, we find that the leadership pipeline has improved to become more diverse but has also regressed to become much less equitable for the API workforce.

Fortune 500 Tech Companies

Much of our earlier research on equitable API executive representation had focused on tech companies, and we will review progress in the tech sector in this report.   We will use the “Executive Parity Index (EPI)”, the ratio of racial representation at the Executive vs Professional job classifications.  For more details of the EEO-1 job classifications, EEO-1 racial categories, and the EPI metric, please consult our earlier paper the Ascend Foundation web site:  TheDiversityEquityGap_Paper.pdf (squarespace.com).

We are listing, in Figure 1 below, the 15 companies in the Fortune 500 with past EEO-1 reports we have been able to collect from scouring the web in the past few years.  Figure 1 also indicates the current Fortune 500 ranking for each company, along with the API share of the Professional workforce, and the reporting years of the available EEO-1 reports.  For HP in 2022, we are using the combination 2022 reports from HP and HPE to fairly compare data from the HP 2014 EEO-1 report (HPE spun off in 2017).

White and API Leadership Pipeline ~2022

The aggregated EEO-1 data detail from these 15 companies are included at the end of this research brief as Exhibit 1 with representation details for the Executive, Manager, and Professional job classifications.  The EEO-1 data show that White representation in ~2022 increases from 42.1% to 65.8% from the Professional level (the lowest rung in the executive pipeline) to the Executive level.   The EEO-1 data also show API Professional->Executive representation falls from 43.8% to 23.3%.  

In addition to Professional and Executive representation data from EEO-1 reports, we reviewed corporate websites to find the data for each company’s most senior leadership.  Exhibit 2 is a list of the most senior leadership teams in these companies we found on the corporate web sites in February, 2024.   In Exhibit 2, 74.7% of the most senior leaders are White and only 19.8% API. 

The racial representation numbers from Exhibit 1 and 2 is summarized in Figure 2 for White, API, and “Other” illustrating the Professional-to-Executive-to-Senior Leadership pipeline.  We use the term “API” to include EEO-1 racial categories Asian and Native Hawaiian/Pacific Islander.  We have combined the EEO-1 data for Black/African American, Hispanic/Latino, American Indian/Alaska Native, and Two-or-more-races as “Other”.

The first observation drawn from Figure 2 is that API representation at each level is higher than the API general U.S. population of 7%.  There is no workforce diversity problem with higher API representation at all levels when compared to general API representation in the U.S. population at 7%. 

But the relevant observation from Figure 2 is that while White representation increases at each level in leadership, representation for API decreases.  APIs are not equitably represented in executive and leadership levels when compared to the more relevant API representation in the Professional workforce at 43%. 

Another key takeaway from the Figure 2 Leadership Pipeline chart is API Professionals now surpass their White counterparts in the Fortune 500 tech companies, yet White leadership is ~4X that of API leaders.

Leadership Pipeline Changes ~2014 vs ~2022

But Figure 2 is just a one-year snapshot of workforce representation.  A more important question is, despite inequitable API representation as executive leaders, have companies been making progress to become more equitable?

To address that question, we compare the ~2022 data to ~2014 data provided in Exhibit 1. Figure 3 highlights the racial distribution at the Professional and Executive levels using Exhibit 1 data.  The good news is that both the bottom and top levels of the EEO-1 executive pipeline have become more diverse, with White Professionals declining from 56.6% to 42.1% and White Executives declining from 72.9% to 65.7%.  And representation for Hispanics, Blacks, and APIs has all increased through the pipeline.

But although White Executive representation declined from 72.9% to 65.8% (-7%), White Professional representation fell much more (-15%), from 56.6% to 42.1%.  At the same time, API Executive representation increased by +2% while API Professional representation grew by +11%. To evaluate differences for White vs API advancement through the pipeline, we use the Executive Parity Index (ratio of %Executives vs %Professionals) as a normalized metric to assess the pipeline throughput rates.  An EPI ratio greater than 1.0 is interpreted as Executive over-representation.  Correspondingly, a ratio less than 1.0 is Executive under-representation. 

In Figure 4, the ~2014 White EPI ratio of 1.29 means that White Executive representation is 29% higher than White Professional representation (Figure 3: 72.9% vs 56.6%).  But while absolute White ~2022 representation as Professionals and Executives in Figure 3 declined, the EPI ratio shows White ~2022 proportional representation as Executives increased from 1.29 to 1.56, so that Whites were 28% more over-represented in 2022 than in 2014.

Figure 4 shows that the API workforce saw the exact opposite dynamic in the leadership pipeline.  Whereas API Professional representation increased by 32% and API Executives increased by 9%, the EPI ratio fell from 0.65 to 0.53.  In other words, APIs were under-represented at the top of the executive pipeline by 35% (1.0-0.65) in ~2014 and by 47% by ~2022, when compared to the bottom, so that APIs were -11% more under-represented as Executives in 2022 than in 2014.

To evaluate the pipeline dynamics between ~2014 and ~2022, we use the numerical gap between the White-API EPI figures to compare the overall effect of these changes in the executive pipeline.  And whereas the White-API EPI gap was 0.64 in ~2014, that gap widened to 1.03 by ~2022, so the clear and unambiguous answer to our original question is “there has been no progress”. 

In the aggregate, tech companies in the Fortune 500 are making no progress in making Executive representation more equitable for the API workforce and, in fact, are regressing.  They have become much more diverse at all management levels for APIs but much less equitable in APIs reaching higher levels of leadership.

IN SUMMARY – In the Fortune 500 tech companies:

1. ... there is no API workforce diversity problem with high API representation at all levels in throughout the leadership pipeline (43% -> 23% -> 19%) when comparing to general API representation in the U.S. population at 7%.  But there is an API leadership equity problem.  APIs are not equitably represented in executive or leadership levels when comparing 19% API Leadership representation to the more relevant API representation in the Professional workforce at 43%. 

2. … API Professionals now surpass their White counterparts in these Fortune 500 tech companies, yet White leadership is ~4X that of API leaders

3. … we see no progress from ~2014 to ~2022 in Executive representation becoming more equitable for the API workforce; and, in fact, it are regressing.  While proportional Executive representation (EPI) for Whites rose +28%, it fell -11% for APIs.  These companies have become much more diverse at all management levels for APIs but much less equitable in APIs reaching higher levels of leadership.

EXHIBIT 1 - Cumulative EEO-1 Data

RACIAL CATEGORIES:

• API includes (i) Asian persons having origins in any of the original peoples of the Far East, Southeast Asia, or the Indian subcontinent and (ii) Native Hawaiian/Other Pacific Islander persons having origins in any of the original peoples of Hawaii, Guam, Samoa, or other Pacific Islands

• Black (or African American). A person having origins in any of the black racial groups of Africa.

• Hispanic (or Latino). A person of Cuban, Mexican, Puerto Rican, South or Central American, or other Spanish culture or origin, regardless of race.  White. A person having origins in any of the original peoples of Europe, the Middle East, or North Africa.

• Other includes (i) American Indian or Alaska Native persons having origins in any of the original peoples of North and South America (including Central America); and (ii) persons of two or more races.

EXHIBIT 2: Leadership Team Details**

** “Leadership Teams” were identified on various corporate web sites as of February, 2024 per: - “Senior Leadership Team” - “Executive Leadership” - “Officers” - “Leadership Profiles” - “Executive Bios”