Harvard Business Review November/December 2020

why we’ve stopped ranking ceos

STARTING IN 2014, HBR published an annual list called the Best-Performing CEOs in the World. The rankings, calculated by measuring financial returns during each CEO’s entire tenure and factoring in two assessments of each company’s environmental, social, and governance practices, helped drive discussion of how society should measure a business leader’s performance. The list was routinely one of the year’s most-read articles on HBR.org. But each year the CEOs on our list were overwhelmingly male and largely white, provoking criticism for a lack of diversity. And each year we explained why this was the case: Most of the S&P 1200 companies we analyzed were led by white male CEOs. Now, in the midst of a heightened global discourse on racial and gender equity, we have decided to break the cycle. Rather than…

contributors

Robin Ely has spent many years studying how organizations can benefit from diversity. So she and her coauthor, David Thomas, have grown increasingly alarmed by suggestions that an “add diversity and stir” approach will magically improve financial performance. “People tout a business case for diversity that simply isn’t supported by rigorous research and doesn’t make a lot of sense,” she says. Companies benefit most from diversity when they are willing to dismantle systems of oppression and reinvent workplace culture so that all employees can thrive and reach their full potential. 114 Getting Serious About Diversity In her research Tsedale M. Melaku, a sociologist and a postdoctoral fellow at The Graduate Center, CUNY, examines how the members of marginalized groups pay an inclusion tax in the form of uncompensated, invisible labor in organizations.…

helping low-income workers stay out of debt

STAGNANT WAGES, a rising cost of living, and increasingly irregular schedules routinely force many working Americans onto a financial knife’s edge; they’re able to pay their usual bills but lack a buffer to handle even small financial shocks. Part of the problem is that most U.S. workers are paid biweekly, and it can take as much as a week for a paycheck to clear, making the wait for compensation even longer. In addition, many workers lack the credit scores to qualify for standard market-rate loans. So to make ends meet or cover unexpected bills, they often rely on payday loans, auto-title loans, and bank overdrafts—high-cost instruments that may push them further toward financial ruin. Economic downturns, such as today’s pandemic-related recession, only increase dependence on these services. A study conducted at…

“even a living wage can’t provide for all emergencies”

Jaime Donnelly is the chief financial officer of Integrity Staffing Solutions, which provides temporary workers and recruiting services to large online retailers across the United States. She recently spoke with HBR about the company’s partnership with PayActiv to offer workers early access to earned wages. Edited excerpts follow. Why did your company decide to provide this benefit? We have a program called Project Home, in which we train our staff to recognize the signs of homelessness among applicants and associates we have placed. Through it we learned that many workers who end up homeless are using high-cost payday lenders to handle unexpected expenses. We wanted to break that vicious cycle, but we couldn’t find a good solution in-house. Then we learned about fintech start-ups that focus on earned-wage access and decided to…

a simple nudge to boost diversity

Even well-meaning organizations often struggle to diversify. For example, despite intensive efforts in recent years, Silicon Valley’s workforce is still dominated by white and Asian men. A new study finds a straightforward intervention that could help. Across eight experiments, the researchers explored the partition dependence effect, which holds that when people are asked to choose a few options from a pool segmented along a given dimension, they tend to pick some from each category. In the first experiment, participants were asked to imagine they were recruiters tasked with reviewing the profiles of eight job applicants and choosing three people to interview. For some participants, the applicants’ profiles were sorted such that the first four were men’s and the last four were women’s; for the others (the control group), the order was…

hold fast to those morning routines

A prolific writer as well as an inspirational leader, Winston Churchill is famous for his daily routine, which began at precisely 7:30 am with breakfast, reading, mail, and dictation, all from the comfort of his bed. Indeed, conventional wisdom holds that a consistent routine, especially early in the day, is key to productivity—and studies have found that most people follow one (or try to). A research team wondered: What happens when those routines are disrupted? To find out, the researchers conducted two studies among employees of a large U.S. university. In the more-extensive investigation, participants were surveyed thrice daily over a three-week period, first about the extent to which they had adhered to their usual morning practices (eating breakfast, exercising, commuting to work, and so on) and, as the day wore…