Speaking to HR magazine, she said senior leaders "lack awareness" and are not doing enough to recognise the "changing demographics" of the country's workforce because it's in the "too difficult box".
This week the RFO hosted its annual awards dinner, which celebrates UK businesses that lead the way on ethnic diversity.
According to RFO's research, one in 16 FTSE 100 board members are black, Asian or minority ethnic (BAME) background.
Kerr said businesses must "unpick" the current problems around colour and social mobility to find how to get the young people who are from ethnic backgrounds into the best schools and top universities.
"In this country we don't really talk about race and ethnicity because we find it too uncomfortable. The media and politicians are happy to talk about it in terms of 'progress' but not when looking for solutions," Kerr told HR magazine.
"Employers need to understand it's okay to discuss race and that it can be used as a competitive advantage."
Kerr said employers are just beginning to "scratch the surface" on this issue but doesn't advocate the UK introduce quotas for more BAME on company boards.
"We don't have a quota culture in the UK…I'd like to see a softer benchmarking approach," she said.
"One of the main reasons there is only a small number of ethnic minority workers reaching board level is to do with an unconscious bias in the recruitment process," she said.
Kerr said HR needs to be "absolutely" at the heart of this issue but said the agenda still needs to be driven from the top.
"Surely a company's workforce should reflect their customer base. If you can alter your own sub-text, break the myth you have created and break up stereotypes, then you can have access to a huge pool of talent."
Earlier this week the proportion of women on FTSE 100 boards rose to 19%, raising hopes that a 25% target by 2015 might be met without the use of mandatory quotas.
Kerr said it's good to see diversity being talked about but "all strains" of diversity should be discussed. "There is a hierarchy when it comes to this issue, unfortunately ethnic minority is always a poor relation to gender," she said.