America’s biggest businesses employed more female and Black finance chiefs in 2021 than ever before—albeit coming from a relatively low base—as company leaders and boards are under pressure to broaden their C-suite, a trend recruiters expect will accelerate in 2022.
The number of companies in the S&P 500 and Fortune 500 with Black chief financial officers nearly doubled over the past year, to 20 in 2021 from 12 in 2020, based on new data from executive search firm Crist Kolder Associates. That’s 2.9% of 678 sitting CFOs, up from 1.8% in 2020. The percentage of female CFOs at those businesses also reached an all-time high at 15.1% in 2021, up from 12.6% in 2020, the data show.
Among the firms that gained Black CFOs last year were telecommunications giant AT&T Inc., which promoted Pascal Desroches; sports retailer Foot Locker Inc., which hired Andrew Page; and investment firm Teachers Insurance and Annuity Association of America, which recruited Dave Dowrich. Animal-health company Zoetis Inc. and industrial-supply company W. W. Grainger Inc. also hired Black finance executives.
Meanwhile, companies such as Charter Communications Inc., Exxon Mobil Corp. and Eli Lilly & Co. added female CFOs.
Boards, which are increasingly diverse themselves, are pushing more and more to diversify the executive ranks, including the CFO position, said Josh Crist, co-managing partner at Crist Kolder. These executives often excel at building bridges to other areas of the business and help strengthen the organization, Mr. Crist said. “They’re very progressive thinkers, to the point where the business will listen to them,” he said.
Some companies in recent months also have sought to boost diversity amid heightened calls for social justice. The number of ethnically and racially diverse CFOs at large U.S. companies has increased each year since 2013, according to the data.
Mr. Crist said he expects hiring of Black and female CFOs over the next 12 to 18 months will likely steeply rise as companies and boards continue to demand a diverse slate of candidates when searching for new finance executives and other C-suite positions.
Increased hiring of diverse CFOs and other executives is an encouraging trend, Zoetis’ CFO Wetteny Joseph said, “but companies must continue to invest in a diverse pipeline, especially early career, in order for it to be a lasting and bigger change.”
“More companies should be intentional about having a diverse perspective within the executive team and creating an atmosphere where everyone has the opportunity to contribute results,” said Deidra Merriwether, Grainger’s CFO. Ms. Merriwether said she gained the necessary experience for the CFO role because Grainger put in place a strategy years ago to diversify its finance leadership.
Turnover in the CFO role creates an opportunity for companies to recruit more diverse candidates for the position, said Cathy Logue, head of the CFO and financial practice group at recruiting firm Stanton Chase. “There’s great progress being made, but everyone is looking for that talent,” Ms. Logue said.
Crist Kolder also found that companies have been hiring fewer external candidates for CFO roles. External candidates represented 38.5% of hirings in 2021, down from 43.1% in 2020 and 39.5% in 2019, according to the report.
Write to Mark Maurer at Mark.Maurer@wsj.com and Kristin Broughton at Kristin.Broughton@wsj.com
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