Black History Month was first started in 1926 with the introduction of Negro History Week, but it wasn't until the 1970s that Black History Month as we know it took hold. President Gerald Ford took the opportunity during the country’s bicentennial celebrations to establish Black History Month and, as he put it, “seize the opportunity to honor the too-often neglected accomplishments of Black Americans in every area of endeavor throughout our history.”
Almost 50 years later, Joe Biden is president and Kamala Harris — a Black, Southeast Asian woman, is vice president. Biden has indicated that racial equity will be a core focus of his presidency. Ford reminded the country of the neglected accomplishments of Black people while Biden has brought Black talent to his inner circle. Beyond the addition of Harris, Lloyd Austin, Marcia Fudge and Susan Rice have joined his cabinet. Most recently, his executive order on racial equity commits the federal government to strive to “advance equity for all throughout our federal policies and institutions.”
These actions create new opportunities for change. The question is, how do we move from intention to impact?
Working in social justice for the past 20 years, I have realized that we often conflate intention and impact in change work. I often remind people of all the intentions we hold to get healthy. We join a gym, buy new workout clothes, maybe a workout machine. But if you do not go to the gym or workout in those clothes, you will not become more healthy. Finding time to actually workout requires an internal shift of priorities and values.
As a lecturer at the Sloan School at MIT, I have been curating a series of conversations around building racial equity into the innovation economy. After months of these conversations, an undeniable theme has emerged. America still does not see the value of Black, Indigenous and people of color, or BIPOC. Nor does it see their contribution to society or the economy. Not truly believing in the value Black people have to offer flies in the face of the history of black contributions. Black and brown entrepreneurs have to prove themselves and are often questioned in ways white entrepreneurs are not. Because of this, less than 1% of venture capital money finds its way to BIPOC entrepreneurs.
For several years, I worked with Harry Belafonte in his efforts to reform the criminal justice system, The Gathering For Justice. We worked in 26 states training over 3,000 at-risk youth in the principles of nonviolence adhered to by the Rev. Martin Luther King Jr., and we supported programs to help them start legal businesses. This work took me to some of the most poor and violent neighborhoods in the country, from the Mississippi Delta to the South Side of Chicago. I was able to see the unbelievable talent we have throughout this country that we are losing because we don’t believe it's there.
Citigroup has estimated that this bias has cost our economy $16 trillion dollars. Banking, for example, is an industry fraught with bias. From redlining to predatory lending to diverse leadership, banking is taking a long, hard look at how to integrate diversity work holistically into their organizations. Fifty percent of Black and brown families are underbanked in America, versus 19% of white families that lack access to necessary banking services.
While working for Berkshire Bank, Isaw firsthand how much change an institution can achieve when it is committed. Berkshire Bank set out to see the BIPOC community as a core market to the future of the community. After looking at the problem holistically, it was able to make changes that included everything from the board memberships to loan products. Partnering with Runway’s, an Oakland-based community nonprofit, the bank now provides low interest loans and startup funds to communities of color.
Funding entrepreneurs made business sense because it started a pipeline of deals for the bank within the Black and brown business ecosystem. The community underwriting process introduced the bank to a new way of due diligence in the loan process that mitigates the bias.
At MIT Sloan we continue to build bridges to the diverse ecosystems in business through conversations with diverse leaders in the innovation economy. Students, faculty and alumni are able to hear from successful entrepreneurs like Leandrew Robinson of Mesh Logistics, who has successfully raised millions of dollars from traditional investors, or Konda Mason of Jubilee Justice Fund, who has started a fund that offers mixed forms of capital to Black farmers losing their land.
Fifty years ago, Ford wanted to make sure there was a place to acknowledge the contributions of Black lives to America's success. Today, Biden has acknowledged that we cannot move forward without racial equity. As Rashad Robinson, president of Color of Change, said at our last MIT conversation, “When we create racial justice, we don’t just get a powerful, motivating force to amplify the voices of the people most impacted; we get the vehicle capable of undoing the policies and practices at the root of our economic inequity.”
Without centering the value of Black contributions to our economy, economic equity in our country will be nothing more than a good intention.
Malia Lazu is a lecturer at the MIT Sloan School of Management.
