MCCA® 2006 Survey of Fortune 500 Minority General Counsel
Justin Choi, Andrew Corporation
Senior Vice President, General Counsel and Secretary
A.B. Cruz III, The E.W. Scripps Company
Senior Vice President and General Counsel
Stacey J. Mobley, DuPont Company
Senior Vice President, Chief Administrative Officer, and General Counsel
Paul C. Tang, Burlington Coat Factory
Executive Vice President and General Counsel
The year 2005 opened with a tsunami and closed with a hurricane. The added havoc of continued fighting in Iraq, soaring fuel prices, turnover in the Federal Reserve, uncertain stock markets—to say nothing of the devastating disasters in Central America, Mexico and Pakistan that rocked already shaky international markets—was enough to potentially destabilize the U.S. economy.
Yet despite this, America’s largest corporations persevered, with Fortune 500 companies amassing a record-setting $9.1 trillion in revenues and $610 billion in profits. Financial boons were felt throughout the list, from Fortune number one Exxon Mobil, which grossed nearly $340 billion in revenues, to LandAmerica Financial Group, number 500, whose revenues exceeded the prior year’s performance by approximately $300 million.1
It was in this already remarkable setting that 32 Fortune 500 general counsel of color stood apart and offered what for some is the most compelling case of all for diversity: returns. This is because while minority general counsel account for just 6.4 percent of the Fortune 500, the companies to which they contribute their talents and diverse perspectives brought in $864 billion in revenues in 2005-9.5 percent of the total.
These elite general counsel form a small but impressive body, continuously improving on the previous year’s successes and leading companies to the fore of the pack. Of the 32 companies, 21, or 66 percent, rank among the top Fortune 250. While last year the highest revenues of companies led by general counsel of color capped at just under $148 billion, this year this figure increased by 28 percent to $189.5 billion. Seventeen, or 53.1 percent, had revenues between $5 and $20 billion, while 14, or 43.8 percent, boasted revenues over $20 billion. The “smallest” company showed revenues of over $4 billion—no “small” feat by most standards.
MCCA® 2006 FORTUNE 1-1000 MINORITY GENERAL COUNSEL RESULTS1
The findings from the MCCA® 2006 Fortune 500 General Counsel Survey are:
- In 2006, 32 (6.4 percent) of Fortune 500 general counsel are minorities, an increase of 4 since MCCA’s 2005 report.2
- Among Fortune 500 minority general counsel and as compared to the 2005 report:
23 (4.6 percent) are African American, an increase of 4;
6 (1.2 percent) are Asian American, an increase of 2; and
3 (0.6 percent) are Hispanic, a decrease of 2.
- By gender, the ethnic breakdown of Fortune 500 minority general counsel is:
Totals: 26 men (81.3 percent of minority GCs) and 6 women (18.7 percent of minority GCs). African American: 18 men and 5 women; Asian American: 6 men and 0 women; and Hispanic: 2 men and 1 woman.
- There were 4 departures and 8 arrivals within this group.
The findings from the MCCA 2006 Fortune 501-1000 General Counsel Survey are:
- In 2006, 24 (4.8 percent) of Fortune 501-1000 general counsel are minorities, an increase of 6 since MCCA’s 2005 report.
- Among Fortune 501-1000 minorities and as compared to the 2005 report:
8 (1.6 percent) are African American, a decrease of 1;
10 (2 percent) are Asian American, an increase of 5; and
6 (1.2 percent) are Hispanic, an increase of 2.
- By gender, the ethnic breakdown of Fortune 501-1000 minority general counsel is:
Totals: 16 men (66.6 percent of minority GCs) and 8 women (33.3 percent of minority GCs). African American: 7 men and 1 woman; Asian American: 6 men and 4 women (2 new); and Hispanic: 3 men and 3 women.
- There were 3 departures and 10 arrivals.
The findings from the MCCA 2006 Fortune 1000 General Counsel Survey are:
- In 2006, 56 (5.6 percent) minority general counsel: 32 in the Fortune 500 and 24 in the Fortune 501-1000. Thirty-one are African American, 16 are Asian American and 9 are Hispanic.
- This is an overall increase of 10 from the 2005 report.
One major factor behind the success of these 32 minority-led companies, like that of the Fortune 500 generally, is the global economy, which grew 4.25 percent bolstered by heavy contributions from, for example, China, whose economy grew nearly 10 percent.2 It seems those companies best able to translate their products within foreign markets gain the most, a testament to a diverse company’s ability to effectively connect with and serve a diverse consumer base. This bears out directly in the case of these 32 companies, of which all but 3 (90.6 percent) have major international operations. Indeed, half (16) rank among Fortune’s Global 500, an annual ranking of the world’s largest corporations, with the Chevron Corporation, Home Depot, Inc., Cardinal Health, Inc., and Dell Inc. standing among the top 100 companies in the world.3
Companies maintaining foreign manufacturing bases also benefit greatly. Levi Strauss, for example, which has a number of factories in China, recorded profits upward of 400 percent at the end of 2005, led by now-former General Counsel Alberto Moreno. Moreno, a Hispanic male, turned the reins over to Hilary Krane, a Caucasian female, at the beginning of 2006.
Those companies with diverse legal leadership do more than just follow the general trends of the Fortune 500, though. Where sectors like petroleum refining, commercial banks, and computers are high performers among the general Fortune 500, the sectors offering the most opportunities to minority leaders are general merchandisers/specialty retailers (6 or 18.8 percent), food and beverages (6 or 18.8 percent), and chemicals (3 or 9.4 percent). It should be noted that Google Inc., led by General Counsel David Drummond, was one of three companies where sector earnings grew over 125 percent in 2005, thereby warranting a new Fortune category, internet services and retailers. Google, which ranked number 541 last year—and subsequently Drummond—are newcomers to this report as number 353 on the 2006 Fortune 500 list.
So What of the General Counsel Themselves?
If law school is a marker, these 32 general counsel of color represent the crème de la crème of American intelligentsia. Twenty-five percent attended Yale, Stanford, or Harvard law schools. Twenty, or 62.5 percent, attended the nation’s top 10 law schools, while 84.4 percent attended the top 25 law schools.4 These figures, combined with the fact that over 70 percent started in law firms, may lend considerable weight to research suggesting that minority attorneys are held to a higher standard than their non-minority counterparts.5
They also cover the gamut of skill sets and work experience, with a marked likelihood of having gained public sector and litigation experience, skills that Diversity & the Bar® previously reported in its Sept./Oct. 2005 article titled, “Becoming a General Counsel: The New Track to the Top,” as the most highly valued and common credentials among today’s general counsel. Of this year’s 32 Fortune 500 minority general counsel, 40.6 percent worked in the public sector, for example, as federal prosecutors, law clerks, or with an attorney general’s office, during their formative years. This is a 26.6 percent differential to the 14 percent of non-minority general counsel of Fortune 500 companies who, as indicated in the aforementioned article, have worked in the public sector.6 Additionally, approximately 72 percent worked in at least one law firm, often rising to partner before transitioning in-house. A number have advanced degrees and/or work experience in business and finance.
Like Fortune 500 women general counsel (see the article titled “Results of MCCA® 2006 Survey of Fortune 500 Women General Counsel” in the July/August 2006 issue of Diversity & the Bar®), general counsel of color are spread throughout the continental United States. There are slight concentrations in Illinois (6), California (3), and New York (3).
A look at the demographics in comparison to MCCA’s 2005 report shows both growth and regression. There are 23 (71.9 percent) African American general counsel versus the 19 (67.9 percent) reported last year; six (18.7 percent) Asian American general counsel versus four in 2005 (14.3 percent); and three (9.4 percent) Hispanic general counsel versus last year’s five (17.9 percent). Losses include the aforementioned Alberto Moreno, who retired from Levi Strauss; Paul Williams of Cardinal Health, Inc., who left in May 2005 and was succeeded by Ivan Fong; and Andrea Zopp of Sears Holdings. Carlos Hernandez, who appeared on last year’s survey as general counsel of the International Steel Group (ISG), continues as general counsel, this time of Mittal Steel USA, a newly formed corporation following Mittal Steel’s acquisition of ISG. The new corporation did not receive a spot on the Fortune list this year.
The loss of two prominent Hispanic leaders from the Fortune 500 left a dearth that was not filled; there are no new Hispanic general counsel. In contrast, there is one newly appointed Asian American general counsel (male). Of the African American general counsel, three are newly appointed (two males and one female), while one, Joyce Mims, helped her company move up from the Fortune 1000.7
Gender among Fortune 500 general counsel of color is far from representative of the population: There are 26 male (81.3 percent) and six female (18.7 percent) general counsel of color. Of the 26 men, 18 are African American, two are Hispanic, and six are Asian American males. Of the six minority women, there are five African American and one Hispanic female general counsel. Teri McClure, an African American, is the only minority woman to join these exclusive ranks since Kellye Walker in 2003. There are no Asian American female general counsel, nor has there been in recent history (for example, since 1997 when MCCA published its first “Annual Survey of Fortune 500 General Counsel”).
In contrast to the Fortune 500, changes in the gender and ethnic makeup of the Fortune 1000 show a trend toward increasing diversity. Five general counsel are new among this year’s survey findings, including two Asian American women and two Hispanic men. Newcomers include Justin Choi of the Andrew Corporation, Michael Futch of Granite Construction Inc., Robert Melendres of Spansion, Inc., Hyun Park of Allegheny Energy Inc., and Simone Wu of XO Holdings, Inc.
The Fortune 1000 general counsel list was not without turnover, however minimal. Oleta Harden of New Jersey Resources, Patricia Jones of H.B. Fuller, and Leslie Parrette Jr. of Aquila, left their respective companies, with Jones and Parrette assuming general counsel positions at Allina Hospitals & Clinics and Novelis Inc., respectively. No information was available on Harden.
With these changes, there are now a total of 24 (or 4.8 percent) general counsel of color in the Fortune 1000, up from the 18 (or 3.6 percent) reported last year. By race, eight are African American (33.3 percent), 10 are Asian American (41.6 percent), and six are Hispanic (25 percent). This compares with last year’s nine African American (50 percent), five Asian American (27.7 percent), and four Hispanic (22.2 percent) general counsel.
Asian American general counsel clearly outpaced every other minority group, with three of the five newly appointed Fortune 1000 minority general counsel being of Asian decent. This tracks with recent data compiled by both the Minority Law Journal and the National Association of Legal Placement that show Asian American attorneys as the fastest growing group of minority partners and nearly half of the minority associates at large law firms8. It must be noted, though, that despite gains, Asian American attorneys still struggle with barriers to advancement in that their high attrition rates equal those of African American attorneys, and their partnership numbers fall short of their associate percentages.
By gender, there are 16 minority males (66.6 percent) and eight minority females (33.3 percent) among Fortune 1000 general counsel—a distinct improvement over their Fortune 500 counterparts. Of the men, seven are African American, six are Asian American, and three are Hispanic. Of the women, one is African American, four are Asian American, and three are Hispanic.
Industry numbers are inconclusive, with utilities and printing/publishing comprising the only two sectors that stand slightly ahead of the others. Similarly, results by region suggest only that Fortune 1000 general counsel of color are stationed throughout the United States. California is the only state with more than two general counsel.
Of the 20 Fortune 1000 minority general counsel for whom data was available, 70 percent attended top 20 law schools.9 Eight, or 40 percent, attended the country’s top five law schools. All but one attended tier one law schools.
Each year, MCCA looks forward to this annual survey and the opportunity to measure progress being made by people of color at the highest levels of the corporate legal profession. Despite the various obstacles that still cross the career paths of minority attorneys to make their journey a bit more difficult than their majority counterparts, it’s clear that their abilities, professionalism, and talent cannot be denied. It’s also clear that, in addition to talent, the diverse perspectives contributed by minority general counsel greatly enhance the performance and profitability of their companies, making perhaps the strongest business case in support of diversity.
In closing, MCCA hopes that this annual survey serves as inspiration for countless minority lawyers who aspire to follow in the footsteps of the outstanding leaders profiled in this report. It’s further testimony to the fact that the legacies these leaders are building transcend the walls of their workplaces and influence future generations of general counsel of color.
- See Ellen McGirt, “The Fortune 500: A Banner Year,” FORTUNE Magazine, April 2006, at http://money.cnn.com/2006/03/31/news/companies/intro_f500_fortune/index.htm.
- Within the Fortune Global 500, Chevron Corporation is number 6, Home Depot, Inc. is number 43, Cardinal Health, Inc. is number 51, and Dell Inc. is number 88. See the full list at www.fortune.com.
- Rank was not available for the year each general counsel graduated, and so reflects the America’s Best Graduate Schools 2007: Top Law Schools issued by U.S. News. See http://www.usnews.com/usnews/edu/grad/rankings/law/brief/lawrank_brief.php.
- Data is not available on the full Fortune 500, however, these results seem in-line with research showing that minority attorneys are held to a higher benchmark than their Caucasian counterparts, and that while law school rank is not indicative of one’s performance, it is still often used as a barometer, particularly for minority applicants, in getting through the door. For example, of 1,833 surveyed partners, only 48.2 percent of non-minority partners went to a top 10 law school versus 83.3 percent of minority partners, and 63.1 percent versus 83.3 percent, respectively, attended Top 20 law schools. See Minority Corporate Counsel Association, “Creating Pathways to Diversity®-Myth of Meritocracy: Bridges and Barriers to Success in Large Law Firms,” Oct. 2002.
- See June Eichbaum, “Becoming a General Counsel: The New Track to the Top,” Diversity & the Bar®, Sept./Oct. 2005.
- The term Fortune 1000, unless otherwise indicated, is used throughout to refer to companies ranking among Fortune’s 501-1000 companies.
- See “The Diversity Scorecard-2006,” Minority Law Journal, at http://www.law.com/jsp/mlj/diversityScorecard.jsp. Also, see “Minorities in Private Practice,” NALP Bulletin, at http://www.nalp.org/content/index.php?pid=143.
- Law school data was not available on four Fortune 1000 general counsel.
MCCA® thanks Alea J. Mitchell for her work in the preparation of this article, analysis of the survey results, and related research; Vicki Richardson, Esq. for completing the extensive and time-consuming survey of 1000 companies to compile data on race/ethnicity and gender of the general counsel; Patrick Folliard for authoring the one-page biographies of the minority general counsel; and I. Clayvon Lighty of Lighty Communications Group, Inc. and editor-in-chief of Diversity & the Bar® for her editorial support and for managing the process.
From the September/October 2006 issue of Diversity & The Bar®