Companies should reconsider their campus hiring strategy if they want to increase the representation of women and minorities in leadership and close any pay gaps, experts say.
Years of aggressive recruiting efforts by admissions officers at elite business schools have resulted in more diverse classrooms. Large U.S. firms such as Citigroup Inc. and Goldman Sachs Group Inc. have recently announced efforts to try to make their ranks more diverse, as well.
Elissa Sangster, a former assistant dean at the University of Texas McCombs School of Business, said women and minorities at times get steered into lower-paying roles or prompted to seek out smaller, boutique firms that may give them more career flexibility but smaller paychecks.
Recruiters from firms with few female or minority executives should discuss the support and mentorship prospective employees will receive to ensure they thrive, said Ms. Sangster, who is now chief executive of Forté Foundation, a nonprofit that seeks to increase the number of women in c-suite roles by covering their costs to earn an M.B.A.
“If you don’t have that conversation at the outset, you leave room for students to think the company doesn’t have a plan for you,” she said.
Russell Isaiah Clemons, a second-year student at the MIT Sloan School of Management, said he initially hoped to land a job at a prestigious large consulting firm after earning his M.B.A. But Mr. Clemons, who is black, said he wasn’t chosen for internships at McKinsey & Co. and Boston Consulting Group during his first year so he shifted his focus to smaller firms during the next fall recruiting season.
Mr. Clemons said he was surprised by how friendly and accessible executives were in the smaller offices he visited during the interview process.
“I loved the fact that I could have a conversation with the CEO, and realized I wouldn’t just be another cog in the machine,” he said. Mr. Clemons accepted an offer to join Cicero Group, a boutique management consulting firm, when he graduates this spring.
Cicero chief executive Trent Kaufman said he encouraged Mr. Clemons to bring his wife during one of his visits to the office. “We want to make sure our highest potential women and minority candidates have every opportunity to feel comfortable at Cicero,” said Mr. Kaufman.
According to Forté, one out of three female M.B.A.s surveyed said they received fewer opportunities for advancement and promotions compared with their male peers, and 30% reported working in a hostile office environment during their career.
Research conducted for The Wall Street Journal by PayScale Inc., a compensation software company, shows that white M.B.A.s out-earned their minority peers in many of the most popular career fields for business graduates.
In finance and insurance, for example, median pay was 4.4% lower for black professionals with an M.B.A. than their white peers after controlling for experience level, location, job title and other factors that can affect earnings, PayScale data show. Hispanic M.B.A.s in these fields earned 2.2% less.
Citigroup last fall announced new efforts to boost the number of women and minorities in leadership roles. The bank said past diversity efforts have helped attract a wider range of talent but not always helped those employees advance to top positions at the firm.
In August, the firm pledged to increase the share of women in jobs with the rank of associate vice president and higher to 40% by 2021, from 37% currently, and to boost black representation in those roles to 8% in the U.S., from 6% now. Boosting women and minorities in leadership will narrow the gap in average wages for those employees across the firm, not just in individual jobs, according to Sara Wechter, Citigroup’s head of human resources.
Goldman Sachs Group Inc. last month said it would start requiring managers to interview two diverse candidates for open jobs at the bank, after setting a target last year for women to make up 50% of incoming analysts, who are typically hired straight out of business school. A spokeswoman called the new hiring target “an important first step” toward Goldman’s ultimate goal of achieving equal numbers of men and women across its global workforce.
Business school classrooms were comprised mainly of white male students until the early 1980s. Since then, enrollment of racial minorities and women has risen sharply, but those groups still make up less than 15% and 40%, respectively, of the current M.B.A. classes at top business schools like those at New York University and Carnegie Mellon University, according to the schools.
University administrators say encouraging more women and minorities to earn the degree isn’t a silver bullet for reversing inequity in the business world but a small step in that direction.
“We are heavily invested in making sure women and minorities have a seat at the table in the boardroom and as future business leaders,” said Ruth Ryles Stiffler, assistant dean of graduate admissions at Olin Business School at Washington University in St. Louis.
Write to Kelsey Gee at [email protected]
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