The Role of Academia in Building Equitable Leaders: A Conversation with Kerwin Charles, Dean of the Yale School of Management

I was honored to recently join my good friend Kerwin Charles, Dean of the Yale School of Management and professor of economics, to discuss the longstanding challenges facing Black Americans and the role academia and Corporate America play in developing more racially just leaders across our society.

Throughout Kerwin’s storied scholarly career he has researched a variety of topics relating to race and gender, including earnings and wealth inequality, job opportunity, and labor market discrimination, to name a few. Nearly one year into his position as Dean, Kerwin announced a series of steps Yale School of Management would take to address racism, recognizing that while the program boasts quite a lot of diversity, it must carry through its values to the curriculum, faculty, and student body. These important steps build upon Yale SOM’s founding mission of educating leaders for business and society.

To say our discussion was enlightening and informative would be an understatement, and with Black History Month now upon us, I’m thrilled to share a few key insights that I believe are critical for advancing racial equity in the workplace:

 Why the Advancement of Most Black Americans is Not Keeping Pace with Other Forms of Progress

In 2019, more Black Americans completed a four-year degree than ever before (Source: US Census). Yet— as Kerwin points out—we continue to see a disturbing trend among Black Americans, especially in the 60th economic percentile and below, where their trajectories of success are severely limited in comparison to their White counterparts.

As Kerwin puts it, “We must ask ourselves: What accounts for the relative slow advancement of Black Americans at the median and below?”

Two key drivers emerged from our discussion: 1) current policies, and 2) the long arm of race throughout history.

For the former, Kerwin shared that the effect from current policies—particularly those which dictate the criminalization of certain activities—impinges most acutely on the poor, the dispossessed and those lacking social or economic advantage. Kerwin specifically cited the greater likelihood for Black Americans to be incarcerated, which then imparts enduring damage, limits job opportunities and stunts economic mobility. In this system of criminalization, these policies impact all Black Americans by association.

Even if current policies had no difference in their racial impact today, Black Americans would still have to confront dramatic challenges to achieving equity because of the shadow cast by history. Kerwin explained:

 “Think about an African American boy who lives in Texas – a state in which his grandfather could not have attended the flagship university in that state, started a moving business, or even purchase a piece of land. What is the effect of this exclusion on that young man today? Nobody knows precisely, but we do know that its effect is not small.”

Kerwin laid out how the long arm of race throughout history does not require active participation today for the lingering effects of racism to still affect Black Americans. Even if Black Americans and White Americans were all non-racist today, there are still psychological burdens to overcome:

 “Let us imagine a young Black student whose brother wanted to be a lawyer many years ago but at the time, there was wholesale exclusion and discrimination in the law. Then that young student—cognizant of how that historical reality impacted his brother— may say to himself, ‘Why engage in the time consuming and onerous process of homework and study given how we’ve been treated?’ He or she may rationally conclude that rewards for this costly investment would be a waste of time.”

For White Americans, it’s more frequently the reverse case, where a young White student can look to either family, friends, or other figures who have achieved great success in numerous, varied fields. It is difficult to dream or imagine oneself as something if there is no foundation upon which that dream can be laid. But having heard of or seen folks like oneself in those roles, fills one with a certain kind of confidence that leads to higher performance, greater likelihood of taking risks, and the ability to bounce back from setbacks faster. This affect makes race an independent variable – one that regardless of class or economic status presents a barrier to progress for all Black Americans.

The Root Causes of the Wealth Gap in America

Kerwin then provided a helpful framework for understanding the wealth gap between White and Black Americans—one of the most concrete examples of systemic racism in our country:

 “The preeminent determinant of wealth for most households is the value of their housing stock. For most families, their wealth equals the equity they have in their house minus the cumulative amount of the debts that they owe.”

Examining the wealth gap through this lens brings into focus the historical and sociopolitical factors that have significantly altered the success trajectories of Black Americans and have given rise to the wealth gap. Kerwin specifically mentioned redlining—the discriminatory practice of withholding loans, services, and infrastructure from areas deemed “hazardous to investment,” where most colored populations lived. Many Black Americans who went northward to manufacturing centers—such as Detroit—were able to enter the middle class, only to later see those jobs disappear in the 70s and 80s due to globalization and white flight. Kerwin also offered a more recent illustration from the 2008 – 2009 financial crisis:

 “Even when Black Americans make great strides in something like homeownership, when there was a collapse in the housing market, the persons most acutely hurt by that national phenomenon were the newest homebuyers, the homebuyers with the lowest initial equity—which were disproportionately Black people.”

These historical factors, coupled with current policies, have ultimately hampered the means for Black Americans to accumulate and transmit wealth inter-generationally. Generational trauma inhibits generational wealth. Not only does the wealth gap materially affect the lives and livelihoods of Black Americans, but it also influences the social fabric of our society.

The Values That Future Leaders – and the Leaders of Today – Should Prioritize to Create Equitable Environments

As Dean, Kerwin teaches a course on systemic racism and has spearheaded several initiatives designed to advance equity, including the launch of the Yale Center for Inclusive Growth and the establishment of the Dean’s Mission and Impact Awards. Much of his work comes back to one key question: how do we achieve equity and the equalized outcomes we desire?

From Kerwin’s extensive research and years of teaching future leaders, he believes it starts with familiarity, listening, and collaboration across racial lines. I believe that these behaviors are crucial for leaders who are seeking to create an equitable working environment in their companies today, too. 

 “At Yale SOM, we bring together diverse leaders and even if nothing were taught to them in the classroom, the act of putting together young scholars who will become future leaders is invaluable.”

Kerwin makes the point that cultivating familiarity amongst students with diametrically opposed backgrounds is the best way to teach them how to talk to each other, how to understand each other’s unique challenges, and how to hear from each other in a way that no textbook could ever provide.

Beyond establishing familiarity, Kerwin emphasizes the importance of listening to each other – the ability to exchange ideas freely and openly is fundamental to every leader’s success. It precludes “gotcha listening,” where one is waiting for the other to slip up so they can pounce on it, requiring that we listen to each other with respect.

This behavior directly impacts and influences the type of culture we can create and sustain in both academia and our places of work. Students and professional colleagues alike benefit from experiences where they can be their best selves. When they are forced to acclimate to a setting in which they can neither speak honestly nor openly, all of the benefits discussed could disappear. 

Kerwin shared how bringing this new way of thinking about equity to the workplace is not only the right thing to do, but that it is critical for ensuring continued business success:

“A leader who is soley focused on achieving their narrow, pecuniary business ends brings greater risk to their company. One must be attentive to issues of equity in respect to customers, colleagues, and the broader public. A leader who does not understand the community he or she serves increases the likelihood of missteps and irreputable harm, from offending their customers with products or services that are not reflective of their needs to losing the trust of their workforce by way of public blunders – all of which hurt the bottom line. Leaders who are focused solely on profits are doomed to lose them.”

For me, speaking to Kerwin validated why we created the MLT Black Equity at Work Certification to support leaders as they seek to advance racial equity within their own organization. It is inspiring to see more than 50 major employers commit to pursuing Black equity with the same rigor and results orientation as their pursuit of earnings and other key priorities. I encourage you to learn more about the Certification here and to continue the conversation about how we can make an impact on racial equity in America by commenting below. Lastly, I want to thank Kerwin again for imparting his insights that will inform our efforts at MLT in the work we have ahead of us.