A McKinsey partner explains the steps he's taking to clear up the 'myth of massive and widespread Black economic progress'

• Shelley Stewart III is a partner at McKinsey and runs the McKinsey Institute for Black Economic Mobility.
• In the latest Equity Talk, he talked about 'the myth of massive and widespread Black economic progress."

Shelley Stewart III believes it's important to close the gap between the reality and the perception of economic progress for Black Americans.

In our recent conversation for Insider, the McKinsey senior partner referenced a Northwestern study published in 2020 in which they asked "for every $100 that a white American family has, how many dollars do you think a Black American family has?" There was an acknowledgement there was a gap, but what people thought the gap was, versus what it actually is, was striking.

The research suggested that people thought that for every $100 a white American family has, Black American families have $70, he told me. But in actuality, on average, it's $10.

"There's this tension where people want greater equity, and greater progress, and then almost, and as a society are starting to have convinced ourselves that things have gone further," he said.

"I see genuine shock and surprise, and then the question that often moves to what are the root cause drivers of that disparity?" While there are a lot of historical reasons why we are where we are, he said, it's important to "talk about what the path forward is."

Steward, who also leads McKinsey Institute for Black Economic Mobility, aims to make sure there's a better conversation and a deeper understanding of where we are, and where we need to be.

"The actual major challenge is, there's a perception gap. I think many, many people believe in the myth — in the case of Black Americans — the myth of massive and widespread Black economic progress, which just doesn't exist," he said.

The following interview has been edited for clarity and length.

I'm interested in your leadership journey and how your background, or lessons, or certain things may impact how you make decisions and how you lead.

One of the areas I do a lot of my work in is in practice we call growth, marketing, and sales. And that's all about: How do we help companies identify opportunities for growth? I'll execute against those. And I do that across a range of different types of institutions.

If I think back to my broader kind of leadership journey, I've always been someone who I think there are a couple of principles. One, I've had a bit of an entrepreneurial edge and always wanting to kind of build things and see things grow. And I was writing. I was reading Fortune and Fast Company when I was in high school. I just get real excited about your businesses and helping businesses grow, which creates jobs. I think there's a piece of this that is kind of an entrepreneurial approach that is deeply fascinated with the prospect of growth and new things.

The second is I love to really take a holistic view to how I architect and design. I've set myself up to be on kind of high performing teams, so I'm always very thoughtful about the teams I construct and it's a supplement of skills that I put around myself, and know my strengths and development opportunities.

I take a very deliberate, thoughtful approach to who I work with and the kinds of teams that I like to participate in and kind of construct. I think it also leads to this idea of, or concept of diversity and diverse teams. A lot of the work that I do outside of my growth, marketing and sales work, although there are some points of convergence all around this idea of promoting greater economic inclusion, with a big focus on Black Americans. And that's something that is something that's deeply rooted in me.

I grew up in a household where I had two professional parents and they're first in their family to go to college and they're both Black Americans. They instilled in me really at an early age that there's an obligation because we are the few — we are in a distinct minority when it comes to people that look like us and in terms of the kinds of opportunities and successes that we've had.

I've always had that deeply entrenched sense of it's important if you're finding some measure and level of success to find ways to help others who maybe don't have the same set of opportunities.

That's kind of been a deeply rooted lesson for me is How do we continue no matter what role I'm in? How do I make sure that I'm bringing more folks that maybe haven't had those opportunities, whether it be micro into my teams or into firms like McKinsey? Or how do I encourage my clients across sectors to think more holistically about the benefits of economic inclusion?

How have you gone about getting others on board and considering your point of view on this?

It's definitely a journey and you have to leverage lots of different influencing tactics and recognize that there's no one right way to bring people to the table on this topic. I think it shows up though, in a few different ways.

In terms of how I engage I think one is there's a set of folks for whom the moral case for greater inclusion is just deeply resonant and it's something that they just instinctively care about, just from a pure morality and equity perspective. There's a whole group of people who are already in that vein, and those tend to be the ones that are maybe a bit easier to bring to the table.

I think there's another group that recognizes the kind of proximate economic benefits, or at least you hope that you can get them there on that. And by that, I mean, we as a firm have done a lot of work that talks about the benefit of diversity in institutions, and how that tends to drive better outcomes for myriad reasons. You get a more lived perspective, which leads to new ideas and challenges, which spawns more innovation and less groupthink. We can increase the performance of institutions if we embrace this broader perspective on who's at the table.

I think there's another set of people who, who recognize — or at least the best path to go down with those folks — is to talk about the macro economic benefits of having a more inclusive economy. We've also done some work that says, if you could close some of these gaps that exist, for example, for Black Americans, what would that be worth to GDP every year? Higher labor, productivity, higher incomes, more consumption. But what healthcare costs — because of the relationship between economic well being and health. There's a set of folks for whom that is compelling, as well.

I try not to be too rigid about what I assume someone cares about and just say, "Hey, there's, there's a whole bunch of reasons that you should care about this."

The vast majority of people recognize that there's value economically, morally there's value, there's political stability, to have to have a more inclusive economy.

Was there a particular moment when you thought "I need to do more. I need to be bringing this conversation to the table. I need to make a difference"?

I grew up in a household where we talked about this stuff all the time. My grandfather was a union leader in the 50s and 60s and you know, did a lot you know, for African Americans in that aerospace industry and that part of the country. And we talked a lot about the civil rights issues. Again, back to this perception gap. It's hard for people to comprehend, but my dad grew up in Long Island, New York in the 50s and 60s and went to segregated schooling for half his career not in the South and in Long Island, New York. And this was, you know, not too long ago.

I've always felt that need to be in the arena and it's never actually felt like a burden. I've always been proud to engage in that. And what I realized — being at McKinsey after and for years — is we're out here, we have the privilege in many instances of working on some of the most challenging and interesting problems that institutions face. And we've got a really tried and trusted — almost 100 years old methodology for how we think about data moving to insights, moving to solutions and actions.

Probably six or seven years ago, a group of us got together and said, what would it look like if we tried to apply this methodology and leverage this great platform that McKinsey has built to actually aim it at one of the one of the greatest problems that faces in my opinion, our country in our democracy which is broader economic inclusion. And again, we start with Black Americans because the data suggests that they experienced at least economic mobility in this country of any group, save Native Americans — there's a lot of stuff that needs to get done there as well.

I think we realized that we needed to do more and use this platform to try to advance this discussion and we started our journey back in 2017. And we were doing it off the side of our desk for a few years and then murders of George Floyd and Breonna Taylor, unfortunately provided a window for us to go and make an ask of our colleagues, and say, "Hey, we want to make an institute. And we want to make it permanent. We want to resource it and we want to amplify and do more work." And you know, three years later and we're down that journey.

What would you say is the one thing you're most proud of for 2023?

This is a difficult moment. There's a lot of things going on, it's complicated. Institutions are revisiting commitments.

I think the thing that I'm proud of is that I'm seeing institutions come together and really say "We're going to take a stand because we believe that this is important," that "we recognize that there's risk of doing that. But we're going to be on the margin. We might change this or change that, but we're gonna stick with it."

They say "Shelley, the work that you and your colleagues at the institute would have been doing to shine a light on these issues has been a source of truth that has helped to reaffirm our commitments and strengthen our resolve." I've heard that from private sector clients. I've heard that from public sector institutions.

What keeps you up at night, then? What are you most worried about?

I'm certainly worried that the posture on this topic of economic inclusion broadly — which I know it'd be vital to so many aspects of what we all appreciate day to day — the posture is shifting in some circles to defensive. It was offensive. It was how can we be proactive, to do more, to be thoughtful, to recognize that you've got to be very delicate and cautious when you're doing anything, frankly, that involves race and ethnicity.

I always find that I'm always a little bit shocked when I say "Oh, you know? Well, you're discriminating against this." My view has always been: we recognize that when you're dealing with race and ethnicity, you have to be very careful and very thoughtful because of how it's been used historically. But we also need to be realistic and recognize that race plays a role in our society. We need to be thoughtful about how we intervene to make it less important over time, but not naive to believe it doesn't have impact on people's lives and people's opportunities.

I'm worried that the posture is moving to defensive now, because of some of the things that have been happening in the courts and some of the lawsuits that have been filed and some of the political musings. I'm worried that we're going to take a major major step back.

I'm not convinced that the vast majority of Americans — if you match the aspiration for greater inclusion and diversity and the actual starting point today — if you compare those two things, my hypothesis would be that folks would want us to be doing more. Again, being thoughtful about it, but you've got some you've got a very kind of well coordinated effort. That is that is moving a lot of institutions to be on the defensive. And, and I think that, that really risk setting us back as a country.