Tag Archive: minority directors

Beyond the Sidelines: The Impact and Legacy of the Rooney Rule

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The sidelines of a football field may seem an unlikely place to look for governance best practices, but the policy implemented to diversify the coaching staffs and senior management of National Football League (NFL) teams—known as the Rooney Rule—has applications far beyond the world of sports. In the second session of the Diversity Symposium that opened this year’s NACD Global Board Leaders’ Summit, Jeremi Duru, sports-law expert and author of Advancing the Ball: Race, Reformation, and the Quest for Equal Coaching Opportunity in the NFL (2011), joined Robert E. Gulliver, executive vice president and chief human resources officer of the NFL, and Cyrus Mehri, co-lead class counsel for some of the most significant race and gender cases in U.S. history, to discuss the Rooney Rule, its impact on the NFL, and the lessons it has to offer companies in all sectors.

Rooney Rule panel

Although the NFL formed in the early twentieth century, it wasn’t until 1989 that the league hired its first African-American coach, Art Shell. Over the course of the next decade, a few other African Americans held coaching and managerial roles in the NFL, but diversity remained an issue for the league. Then, in 2002, two African-American NFL coaches with winning records were fired: Tony Dungy, whose team had reached the NFC championship playoffs in each of the three previous years, and Dennis Green, whose team was experiencing its first losing streak in 10 years.

In response, Mehri and attorney Johnny Cochran released a study demonstrating that African-American coaches were statistically more successful because by the time they were hired, these men had already spent years honing their craft in apprenticeship positions. However, African-Americans were less likely to be appointed to higher-level coaching positions and more likely to be fired when their team hit a losing streak. To address this situation, the NFL in 2003 established the Rooney Rule—named for Dan Rooney, who was then coach of the Pittsburgh Steelers, a team that historically had created opportunities for minority players and coaches. The rule requires management to interview minority candidates and give them equal consideration when hiring for particular job categories.

Being attuned to diversity issues is key to attracting the best leadership, according to Robert Gulliver. As a former wealth, brokerage, and retirement HR officer at Wells Fargo & Co., Gulliver might have seemed an odd choice for a role at the NFL, but the skills he developed in the financial sector transferred easily to his work for the NFL. Gulliver emphasized that, in addition to diversity of background, diversity of perspective allows the company to connect more strongly with its consumer base.

One area in which the NFL acknowledges the need for more work is that of gender. While approximately 45 percent of football fans are women, only 30 percent of NFL employees are female. By bridging this gender gap, the league can ensure that thought leadership within the company will better reflect its customers.

What is the lasting legacy of the Rooney Rule? In the decade since the rule was adopted, the NFL has developed a culture in which diversity has become a critical element of creating a sustainable business. NFL clubs that initially resisted the rule now recognize that they would fall behind in the market if they didn’t draw from the broadest possible pool of candidates. The message is clear: make your processes inclusive, and make sure that talent rises up. In short, the Rooney Rule has proved that the more inclusive an organization is, the more it and its stakeholders benefit.

Boardroom Diversity

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In Wednesday’s edition of NACD Directors Daily, the Sacramento Bee reported that Sodexo was named to the Black Enterprise Top 40 Best Companies for Diversity list for the fourth consecutive year. The company was recognized, in part, for the number of ethnic minorities represented on the company’s board of directors.

While there has been a call for increased diversity in the boardroom for years, the majority of companies have not significantly added to the number of minority directors (based on race and nationality) currently on their boards. According to the 2011 NACD Public Company Governance Survey, 52.4 percent of companies do not have minority directors. Just over 27 percent of boards have one minority director, and only one in five have two or more.

Similarly, few women serve on America’s public company boards. Nearly one-third of public company directors indicate that their boards do not have any female representation. Half of respondents say their boards have just one female director. Just 11.5 percent responded that their boards have three or more women directors.

However, these percentages appear to be increasing. Survey responses indicate that the number of boards with at least one minority or female director has increased since 2006.  Over 38 percent of boards in 2006 had at least one minority director, and in 2011, this number increased to 47.6 percent. Additionally, boards that reported having one female director slowly increased from 64.8 percent in 2006 to 67.4 percent today.

The final 2011 NACD Public Company Governance Survey will be available in late August.