“You’re joking, right? Isn’t that your job?”
That was the response I gave an executive search professional who called me regarding a vice president-level search he was conducting for a Fortune 500 firm. Because of the fast-growing Latino consumer market, his client wanted the position filled with a Hispanic executive. He wanted to know if I could connect him to top Hispanic executives.
I pressed him for specifics not about the search, but why he needed my help to identify top Hispanic executives. His honest response: “Our firm simply doesn’t know who the top Hispanic executives are.” That is why I worry about the executive search industry.
Search firms aren’t to blame for the fact that women run just 3.6 percent of Fortune 500 companies, and that more than 850 Fortune 1000 companies have no Hispanics on their boards. But they could be doing more to fix such gaps.
Executive search is a $9 billion industry after all, and at some firms, virtually all external recruiting is done by outside firms. If women and minorities are not on the executive search firms’ radar, they won’t be presented as candidates, especially at levels below top C-suite jobs.
Some firms are getting so frustrated with executive search they are taking matters into their own hands. For example, Coca-Cola has built internal executive recruiting teams, with many individuals coming from the top search firms. The company has found the diversity of candidates is much greater when sourced by its internal teams. This is likely because internal recruiters have a better idea which women and minorities will be successful at their companies.
According to the Association of Executive Search Consultants, the number of boutique search firms that specialize in providing diverse candidate slates for clients is also growing. Firms such as Carrington & Carrington, Desir Group and The Prout Group are often female- or minority-owned, which allows them to have deeper inroads into networks of diverse executives. Growth of such boutique firms can partly be explained because companies are not satisfied with the diversity of candidates being provided by the big search firms.
But top-tier search firms are not standing idly by as they look for ways to increase their knowledge of diverse candidates. Some have launched diversity practices that serve as an internal center of expertise and that work closely with their industry and functional practices to present qualified, diverse candidates to clients.
Also, many search firms are expanding into providing services such as succession planning, executive coaching, leadership development and consulting. This allows them to know more executives and often increases their exposure to top female and minority talent. They can then leverage this broader network to build female and minority pipelines for future searches.
Some firms are even hiring former diversity executives to tap into their expertise and contacts. Carol Bullock, a former diversity executive at Amoco, Zurich Insurance and RR Donnelley, recently joined The Hollins Group to enhance its ability to offer diverse candidates to clients.
But the blame does not fall on executive search professionals alone. Diversity executives could be doing more. Some diversity leaders don’t have any idea who I’m talking about when I mention recruiting companies Russell Reynolds, Spencer Stuart and Heidrick & Struggles.
Diversity executives should forge relationships with top-tier search firms to identify ways to help clients identify more external diverse candidates for top roles. They should foster relationships between their companies and the boutique search firms that specialize in female and minority searches. They should influence their executives to use boutique firms to fill some of their future top roles.
Changing demographics and expansions into new markets will require high-performing executives from broad backgrounds. Most companies try to groom their own diverse talent, but when our companies need to look externally, we need to expect more from external recruiters. Hopefully the days of top-tier firms admitting they don’t know the top female and minority executives are over.