Feature Story from BlackPressUSA
George E. Curry
November 5, 2007
It's hard to feel sorry for E. Stanley O'Neal, who was forced to retire last week as CEO of Merrill Lynch. He had to give up his hefty salary and perks after an $8.4 billion charge off, the largest known loss in Wall Street history, resulting in a $2.3 billion loss for the quarter. To date, he is the sub-prime credit industry's largest and most visible casualty.
But we need not shed a tear for the first African-American to lead a Wall Street firm. He will walk away with $161.5 million in pension and benefits accrued over a 22-year career with the firm. That doesn't include the $70 million he was paid over the past five years as CEO. And as he ponders his next move, O'Neal will have the benefit of an office and a paid executive assistant.
Part of O'Neal's unmaking was his own undoing. He was a loner in a culture that prides itself on relationships and he placed an overabundance of faith in the sub-crime credit industry, leading to massive short-term profits, but long-term disaster. It also did not help matters that he made an overture to Wachovia bank without first informing his board of directors, many of whom had been hand-picked by him.
O'Neal's departure was followed by another high-level exit at Citbank. Charles Prince III, its CEO, "retired" with $147 million. That doesn't include the $53.1 million he was paid over the past four years or the $94 million he had in stock that was already vested.
Both men sailed out of office in golden parachutes that will give them and their families a soft, cushy landing. The major difference between the two departures is that Prince's exit leaves 494 Whites as head of Fortune 500 companies. Moreover, his replacement is also a White male.
No Black is expected to succeed O'Neal in the top job at Merrill Lynch. His departure leaves only six African-Americans as CEOs of Fortune 500 companies: Kenneth Chennault of American Express; Aylwin Lewis, Sears Holding; Clarence Otis at Darden Restaurants; Ronald Williams Aetna; Rodney O'Neal, Delphi; and Richard Parsons of Time Warner. Parsons announced Monday that he will retire at the end of this year, leaving literally a handful of Black CEOs at the top of Fortune 500 companies.
As the numbers illustrate, despite all the widespread talk of diversity and inclusion, there is exclusion from top corporate offices. If African-Americans were represented at the top of the corporate ladder in the same proportion of their population, there would be 63 Black CEOs of Fortune 500 companies. Instead, we now have six, with one them having one foot out of the door.
Ignore the slick advertising (when companies do advertise in Black media), flip the channel when you see United Nations-like images plugged on TV and understand that corporate America is sending Blacks another message: We want your dollars, but don't fully appreciate your brains. White men don't have a monopoly on intellect. And even when they fail at a company or even in professional sports, there's always another company or team willing to bid for their services.
For example, the stock of Home Depot sold for around $50 when Robert Nardelli took over as CEO in late 2000. By the time he was ousted earlier this year, it was lingering in the $35 to $40 range. Nardelli was shown out of one door, but into another one. With a $210 million exit package in tow, Nardelli was able to land a job in August as CEO and chair of Chrysler.
In addition to seeing more African-Americans named CEOs of major companies, the other test of fairness will be to see if Stanley O'Neal and Dick Parsons get a second chance at another corporation. After rising from the cotton fields of Weedowie, Ala., O'Neal had increased his firm's stock by 50 percent before crashing and burning. Parsons provided strong leadership at Time Warner after a terrible merger with American on Line (AOL).
The larger issue is not what happens to O'Neal and Parsons personally. Instead, it's whether the talents and aspirations of African-Americans will be valued in an increasingly diverse nation. There are many capable African-Americans serving as CEOs of large corporations not on the Fortune 500 list. And there are still others waiting in the wings, hoping for a chance to demonstrate their skills.
The advertising community has demonstrated that it recognizes the value of Black spending power. By 2011, annual Black spending power will reach $1.1 trillion, representing almost nine cents of every dollar spent in the United States, according to a University of Georgia study.
It's time for African-Americans to be valued for more than their ability to spend money. We should be valued for our sense, not just our cents.
George E. Curry, former editor-in-chief of Emerge magazine and the NNPA News Service, is a keynote speaker, moderator, and media coach. He can be reached through his Web site, www.georgecurry.com
