Sealing the Opportunity Gap for Black Americans

23:38Okay, I'm still trying to process that statistic you just mentioned, Ken, because that's staggering.

23:47Ken Frazier:The average employed African-American man today in 2021 has a bigger gap versus his male-white counterpart. And I'm acknowledging the point about women in my comparison here. The gap is as big as it was in 1953. So from a societal standpoint, we are making no progress with respect to incorporating African-Americans into the economic mainstream at a time when the workforce itself is becoming more diverse. So as a country, if we don't figure out how to get the benefit of all of our talent, and we know that the education to employment pipeline particularly fails African-Americans, if we don't address that, I don't see how corporations can possibly be successful.

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25:40Ken Frazier:And by the way, if we do address it, these people become customers. They buy our products. They don't become simply people who have to be sustained through a social welfare system. So there's no reason for us not to take on this as a society. I'm sorry. No, no, no. I appreciate that. Thank you. I am going to switch gears back to the vaccine and the therapeutics for a second, but I do want to remind our audience to ask their questions because we do want to get to those as well. I want to follow up on the vaccine a little bit just because a couple of things that I'm curious about. One is that the government was involved deeply in funding for a company, not just the U.S.

26:19government, but governments. And I'm curious, is this just a crisis and a one-off, or are we actually seeing different models for business and government working together towards innovation?

26:29Ken Frazier:I hope it's the beginning of different models. First of all, there are a lot of companies that didn't accept government funding. For example, Pfizer, BioNTech did it all from their internal capital. But I think that what we see here is the government saying, look, how do we create sustainable models for people to go after these kinds of viral and bacterial infections. And, you know, we've walked right up to that in the past. So, for example, after 9-11, the government was very much worried about bioterrorism. And it said, okay, let's make sure that these companies have the funding to develop the kinds of protections against bioterrorism.

27:08Ken Frazier:But somehow we forgot about that. I'll use the example about antibiotics. And, And, you know, in 2050, more people will die from resistant forms of bacteria than will die from cancer. And yet we don't have a market that actually supports work. We don't have market-based initiatives. So we have to find these public-private partnerships in order to provide the capital to go after things like we did in the example of COVID. So I would hope that we would continue to focus on those kinds of issues because it's unlikely that this is going to be the last viral pandemic we face. We faced Ebola before this.

27:46Ken Frazier:We've now faced this. We faced SARS. We faced MERS. We have to continue to develop the kinds of medicines and vaccines that we need. And, you know, we had, there were difficulties with some of those diseases to get vaccines that could be successful, some false starts and some big problems in some cases. But now we've seen that we can get to market so quickly with the vaccine, and you talked about that and the new technology. Is that something generally that as the public we can expect that as we see different types of diseases come along, we're going to be able to move much faster? Or is that this particular situation?

28:24Ken Frazier:Generally speaking, I think we should be optimistic that we can move a lot faster with some of the new technologies and some of the things that we've learned. But we have to realize that each virus is very different. So, for example, we still don't have a vaccine for HIV. We've been going after that now for decades, and we haven't been able to develop a vaccine that works for that particular virus because, among other things, it mutates so quickly. I think in this instance, one of the things that we see, and I mentioned it earlier, is the particular spike protein for SARS-CoV-2, which causes COVID-19, itself is extremely immunogenic.

29:01Ken Frazier:And you can see that because other companies using very different platforms from the mRNA vaccine, for example, Johnson & Johnson just had data out today about their adenovirus vaccine. They're seeing high levels of immunogenicity based on different platforms that use, if you will, this spike protein as the antigen. So I think we should be optimistic going forward that some of these new technologies will allow us to come forward with vaccines much quicker. But we have to recognize that there is a unique aspect of the spike protein for COVID-19 that makes it not easier to develop a vaccine, but makes the vaccine much more immunogenic.

29:44And you talked about the therapeutics. I know Merck has just recently invested big time with an acquisition, which just makes me think we're going to be living with COVID for a long time. If you're going to invest in these therapeutics, and so we're not seeing this is not going to be eradicated, basically.

30:04Ken Frazier:No, I think that if you look at the natural history of viral infections, very rarely, if any, have we seen be eliminated or eradicated. So, you know, what we're hoping to do is to get through this pandemic phase where we have, you know, large numbers of people being sick and dying. But there will still be an endemic phase where we're going to have to think about the right kinds of vaccines and the right kinds of therapeutics for people who get sick. And remember something about this particular pandemic. It is truly a global pandemic. Ebola, where we were very fortunate in developing a vaccine here at Merck, turned out not to be really a global pandemic.

30:41Ken Frazier:It turned out to be a pandemic that was really confined to certain countries in sub-Saharan Africa. This is now truly a global platform, a global disease. And I like to say until all of us are safe, none of us are safe. Yep. So, Ken, I'd like to bring in some questions that we've received in real time from our audience. The first one is from Brandon, who's in Washington, D.C. And Brandon says, as an employee of GE Healthcare and an operating leader of its African-American forum, what advice would you offer in terms of how I can influence our CEO, Larry Culp, to sign on to this critical initiative?

31:28Ken Frazier:Well, you can bring it to his attention. That's the first thing. I think that what we have inside these organizations with organizations like the one that you lead inside GE is when people come together, for example, Black employees, and really believe in their own agency, they can bring issues to their management. The management has to obviously decide whether to join the coalition or not. GE is a great company. It has a great workforce. And I think the only thing you can do is urge your management to take it seriously and to look at this very seriously. And I know I'd be happy to talk to Larry Culp.

32:06Ken Frazier:I'd be very happy to talk to my former colleague, who's your general counsel, Mike Holston, and others. If this is the right time for GE to join, I think that would be a good thing. But I think it needs advocacy inside the company. So Brenda from Maryland has a question about the measurement and evaluation process for 110. She'd love to know, will public updates be made? I expect that public updates will be made, but we haven't started there. We really started with the position that companies have to assess where they are. Each company's in a different place. And by the way, each one of these companies has on its own journey done some really good things along the lines of how to hire, train, and promote African-Americans.

32:49Ken Frazier:What we're really trying to do right now is look internally. So I mentioned the fact that 80 % of African-Americans at age 26 don't have a four-year degree. So the first step is for these companies to look internally at their own job requisitions and to ask which of these jobs really do require a four-year degree. We're really saying we have to adopt a skills-first hiring approach rather than a credentials-based hiring approach. And so I don't know that we're actually company by company deciding whether each company will make its progress public. What we want to do is hold 110, the startup company that we're creating, And it is a startup, and it's intended to actually help connect the employer community with the companies and nonprofits and credentialing organizations that train people, which exist.

33:42Ken Frazier:And some of them do a very good job, but they're subscale. What we're trying to do is to bring the collective power of these companies together by offering jobs. And then that will help people on the other end, the people who are actually training and developing people, to be able to do it at scale. And so 110 will hold itself accountable over time to how close we are getting to the goal of 1 million Black Americans being hired over 10 years. So we have another question from Lance in Illinois. As a corporate leader, how do you wade through the various political spectrums in a highly charged landscape and not create party lines when challenging systemic norms within your company walls?

34:28Ken Frazier:That's an excellent question. It's not an easy question. I will say, first of all, I don't believe as the CEO of Merck, I have the right to tell people what to think about partisan political issues. And I try to avoid taking positions on partisan political issues. I don't know that my employees would always agree that I'm successful. But what I try to address with my platform, or what I consider to be issues that go to our values as a country. So when I speak out about something like Charlottesville, for example, I tried very hard not to make it a partisan issue. I thought what was going on in Charlottesville really spoke to the country's core values.

35:07Ken Frazier:And so what I really do with 110, I think Americans all agree that we want to have economic opportunity and it should be available to everyone. And so when we started this, it was really more about saying, how could we actually vindicate the aspiration that we have in our society of everyone having an equal opportunity by addressing the systemic barrier that these four-year job requirements had on a group of people who disproportionately have not had access to that. So we were just talking about the role of the CEO when political issues come up, and you made it clear the bar has to be pretty high, for you at least, to kind of wade in on these issues.

35:53So I'm interested, you know, Charlottesville was a moment when you were out there and relatively alone initially. What was the fallout in terms of business, in terms of employee response, customer response? I mean, was there fallout for taking a public stance, you know, against the president back in 2017?

36:15Ken Frazier:So there was public fallout. I would point out that before I did that, I actually consulted my board because I wanted to make sure that the board was comfortable that I was speaking both based on my own personal conscience as well as as CEO of Merck. And I'm very pleased that my board said unanimously, we want you to speak to the company's values. But there was fallout. There were some customers who were unhappy with us. There were employees inside the company who viewed my statement to the public as being against the president. I was really saying these are our values as a country. We believe in pluralism.

36:52Ken Frazier:We believe in equality. And I think our leaders need to make statements against bigotry and hatred. Unfortunately, some people viewed that as being against the president. That was not my goal. By the way, just to flip it around, when the president asked me to join his business council, Many of my friends on the opposite side of the political spectrum criticized me for that. They said, oh, you're now supporting the president. My view was, as the CEO of Merck, if the president of the United States wanted to have our input on issues that are important, like health care, that I ought to show up in the room because I was asked.

37:32Ken Frazier:And when I joined initially, I was willing to take the criticism of my more left-oriented friends. And when I stepped off, I was willing to take the criticism of my more right-oriented friends. So I know we're going to run out of time here, but I'm really interested to know, having read about you and hearing you today, you didn't have the easiest time growing up. But I'm curious what, from your background in your earlier days, enabled you to be so successful. What were some of the things that helped to, you know, propel you to where you are? So first of all, let me be very clear. I was lucky that I didn't face the same educational opportunity gap that all the kids who grew up around me in the inner city of Philadelphia did.

38:20Ken Frazier:My younger sister and I, and we're the eighth and ninth, respectively, of my father's nine children from two different marriages. We came along in a birth order at a time when it was during the civil rights movement. And the city fathers, the social engineers, so to speak, in Philadelphia, decided that they wanted to engage in an experiment, which they called school desegregation. And what that meant was that a few African-American kids would be put on buses and sent to the very best schools. And my younger sister and I had that advantage just because of where we were in the birth order. And so, for example, in my high school, I think there were like 12 or 13 African-American kids out of 1 ,400 kids.

39:02Ken Frazier:But it was a very good school. I got a very good rigorous education. And that helped me because here I sit today because, you know, almost incidentally, I got a better education than the kid next door. And that's wrong. In this country, often we allocate education based on the ability, at least public education, based on the ability of a parent or guardian to afford real estate that's proximate to where the good schools are. So I had that one advantage in terms of the opportunity gap. The other benefit that I had, frankly, was, you know, I was raised by excellent parents and my mother died when I was a child and I was raised by a single parent father, which is unusual.

39:41Ken Frazier:My father's often say was not a very sentimental man, but he had very high standards. And so, you know, in my father's house, the things that mattered where you went to church on Sunday and you went to school and you got good grades. And you actually you had to believe that you had a role to play later and had a responsibility to actually achieve your best in school and then later on in life. So I had those two advantages. All right. So that's a great moment to close out on. Ken, I want to thank you for being our guest, taking on a lot of really interesting, important, complicated issues, and as always, being super thoughtful.

40:21So thanks a lot for being our guest.

40:22Ken Frazier:Can I just make one point for all your viewers? For those of you who are interested in working with us on 110, we have 37 leading companies and CEOs who agreed to actually put their shoulders to the wheel to try to create this employment opportunity that doesn't exist for Black Americans. We're starting with Black Americans, but we believe that if we eliminate systemic barriers for Black Americans, we'll help everybody in the process. We encourage you to reach out to us because we need all the help we can. So thank you. Okay. All right. Thanks again. Thanks for being on HBR Now. All right. So next week on Tuesday, 12 noon Eastern time in the U.S., we will have our last show of the season.

41:08Our guests will be our first repeat guest, and that is Dr. Anthony Fauci, the leading expert in the U.S. on COVID-19. We'll talk with Dr. Fauci about the surge in cases, about the latest mutations, and about the rollout of the vaccines. So I want to thank our sponsor, Accenture, for being with us, and thank my co-hosts, and thank all of our viewers for being with us. Thank you.

41:54I wasn't just muted when I was trying to speak, was I? No. I didn't hear a word you said. No, you were fine. I was totally worried because I was hitting the mute button because I had stray noise in the background. But okay. I wish we had a promo card for Ken for 110.

42:10Ken Frazier:Yeah, we should have done that. Yeah. Well, that was good. But you definitely, I'm sure you'll get some quick recruits. I signed up. I signed up yesterday. You too. I signed up at the announcement. Thank you. Thank you so much. Yeah. So yeah, Ken, we're living in a weird world. You know, what do you tell friends and family about how to survive day to day when, you know, the headlines day to day get crazier and crazier? You know, one of the things that I think is really important, you ask me what I say, for example, to my kids. My daughter is a computer engineer. She started her own company out in the Silicon Valley.

42:48Ken Frazier:And my son is in New York working for a real estate firm. One of the things I say to them is stay focused. Stay focused on your own career. Stay focused on putting yourself in a position where you can contribute. You know, when the George Floyd thing happened, for example, my son was very upset because he said, Dad, you don't seem to be angry. You don't seem to be willing to go out into the streets. And I said to him, you know, I understand how you feel. You can be completely adamant about the fact that you want to see progress happen and you want to see it happen now. But one of the things that I learned was the pragmatism that allows me to be, and I'm borrowing the Hamilton song, in the room where it happens.

43:31Ken Frazier:And so you mentioned there are only four African-Americans. But by being in that room, when people began to look around and ask the question, what should we be doing, Ken? We could come up with a 110 and we could get people to sign up. And$100 million in the first year is not a small amount of capital. And so I remind my kids that they have a responsibility, notwithstanding all the craziness around them, to be excellent individually so that they can progress to a point where they can help others, they can bring people along. So, Ken, I really appreciated you sharing the story of your upbringing and running a Fortune 500 company and paying it forward with an initiative of this magnitude.

44:19It's quite something. What is your hope for where we will be in 2030 and what this legacy might have brought into?

44:28Ken Frazier:Well, I hope we hire more than a million people. And I hope that we expand beyond black Americans to a lot of other people who are underrepresented and don't have opportunities. I hope this causes companies. If these companies change how they hire, if they examine how they hire, a lot of other people will get opportunities. I always say, you know, maybe this is not a great analogy, but you know, you know, in New York City, in order to accommodate people in wheelchairs, there are these cutouts on the curb to allow people to go across the street in a wheelchair. But you watch people who are pulling their luggage.

45:06Ken Frazier:They all use those cutouts. So what we did initially to help one disadvantaged group actually helps everybody. And that's my philosophy, is if we become conscious of the systemic barriers that exist in our society, and we are willing to work against those systemic barriers, it will help everyone. You know, when you speak, I feel so hopeful when you speak. And I haven't felt that way in a while, so I knew there was like a strange feeling. But you said earlier there's something about truthful discourse, and I felt like there's no way back. And I wonder if you have hope in that regard, too, that we could get back.

45:46Ken Frazier:Yeah, that is a hard issue because, as you know, with social media, we can go to find an echo chamber that reinforces what we already believe. And I think that's one of the biggest problems we have in our American political discourse now is that people retreat to their own sources of information. You know, we have alternative facts. And I think, you know, to be honest, one of the things we have to be most fearful from is what Gables called the big lie. And the fact that people often are willing to suspend their own critical judgment and believe things that are not true. I mean, in this election, we know the following things are, in fact, true.

46:25Ken Frazier:We know that, for example, the states all certified their votes. And we know that many of those states were run by Republican governors and Republican secretaries of state. We know that there were 60-some lawsuits challenging whether the election was fraudulent or not. We know that the people who are standing up in the well of Congress saying that the election was fraudulent are saying that their election lowered down on the ballot was valid. We know all of those things. And yet people are willing to suspend their own critical judgment and believe what I call the big lie, which is that only the presidential election was fraudulent.

47:03Ken Frazier:And by the way, the reason why it was fraudulent, let's put it on the table, is because he's very clear. He says something's going on in Philadelphia. Something's going on in Atlanta. Something's going on in Milwaukee. And so, frankly, you know, we know that's code. And I'm hoping that we get past that. And I'm not trying to be partisan. And I think this particular president had the ability to call people. He was almost methionic to some people. And he got people to suspend their judgment. And I hope that we can bring people back. I hope what happens as a result of Biden's election is that the Republican Party becomes a center-right party like it used to be.

47:48Ken Frazier:And the Democratic Party becomes a center-left party. And that there is the ability to solve problems in the middle. That's what I hope will happen as a result of this election. Yeah, I got to say, the sight of a guy in the Capitol carrying a Confederate flag was one of the most jarring images. I cannot unsee that. It didn't happen in the Civil War. So we got to 2021. Unbelievable. And we had that. Unbelievable. All right, Ken, you probably have to go, and you've given us a lot of your time. Yeah, thank you, Ken. But thanks for coming to the World's Least exclusive after party. Thank you very much.

48:29Ken Frazier:It was a pleasure. All right. Take care. All right. Bye-bye.