Diversity: The Obama Effect

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Feature Contents

1. Appeal for DiversityTo better serve their multicultural customer markets, corporations

are putting pressure on the law firms they hire to diversify. But

advocates say minorities have made only moderate gains in the

legal profession.

2. Companies Must Set Diversity GoalsWhile many people think diversity in the workplace is a numbers

gamethink headcounts and quotasthe truth is measuring

diversity involves more than simple math. This series focuses on

Diversity: The Obama EffectExperts believe the election of the first African-American president of the

United States will redefine workplace diversity, placing a greater emphasis on

multiculturalism and socioeconomic status.By Jessica MarquezComments 4 | Recommend 16

n many ways, Subha Barry believes her job will be easier now that the

United States has its first African-American president. She was having lunch

at a diversity conference in Hong Kong when the organizers broadcast

President-elect Barack Obamas November 4 victory speech in Chicago.

"I remember thinking that the job of any supporter of diversity is going to

be much easier because we now have this visual symbol in the most powerfulrole in the world," says Barry, managing director of global diversity and

inclusion at Merrill Lynch.

But Barry also realizes that with Obamas presidency comes a new set of

challengesthe most game-changing of which will be how his position raises

the bar in defining diversity. No longer will it be sufficient for companies to

simply consider race, sex and religion in silos, Barry says. Experts believe

there will be more focus on multicultural as well as socioeconomic diversity

within the workplace.

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how one major Midwestern city, despite being beset with

economic issues, is dealing with the issue of workforce diversity.

Detroits experience can bee seen as an example for other

metropolitan areas.

3. Kaiser Permanente: Optimas AwardWinner for

Ethical PracticeThe nonprofit health care provider uses a from the top down

strategy to attract and retain a diversified workforce and

membership.

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"In this country, we have these constructs that view race in a

one-dimensional perspective. But in other countries the consideration of race

is more complex, so he is viewed as multicultural," says Ana Duarte

McCarthy, chief diversity officer at Citigroup. "The fact that Obama is

multicultural will put more focus on what it means to be multicultural."

Obamas father was born in Kenya, and his mother was an American from

the Midwest.

At the same time, Obama has spoken about the need for more

socioeconomic diversity in higher education, and experts expect that to spill

into the workplace.

"There has started to be chatter online about a move toward class-based

affirmative action," says Tarun Mehta, an attorney in the San Francisco office

of Bryan Cave. This could mean that employers will have to take into account

socioeconomic differences as part of their diversity initiatives.

But before companies can even think about working on these more

sophisticated diversity initiatives, they will have to address a slew of new

challenges that are expected under Obamas administration. These include

increased criticism of affirmative action policies by opponents as well as

greater enforcement of affirmative action policies by the government.

All of this comes as companies face the biggest economic crisis in years. A

Conference Board survey of CEOs released in October found that having a

diverse workforce fell in importance by four rankings since last summer, while

reducing health care costs jumped seven rankings.

"Its probably going to be more difficult for HR to get the CEOs attention

on these kinds of issues right now," says Toni Riccardi, senior vice president

of HR and chief diversity officer at the Conference Board. "Its not that

diversity is less important to employers; its just that other things are more

important."

Elections impact

Within days of the election, HR executives already were hearing arguments

from critics of affirmative action saying that Obamas victory was a sign that

there isnt a need for diversity policies, says Lewis Benavides, vice president


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for HR at Texas Womans University and a member of the Society for Human

Resource Managements special-expertise panel on workplace diversity. A

similar concern was raised by several SHRM diversity panel members at a

meeting November 10 in Alexandria, Virginia, Benavides says.

"There is an acknowledgement that when the highest officer of the land is

an African-American, there will be people who will say, Why do we need

these programs anymore? " he says.

Its an issue particularly for companies with voluntary diversity programs,

experts say. Companies may also see an increase in reverse-discrimination

lawsuits from white males, Mehta says.

"Given the economic conditions, it might not be hard for opponents of

affirmative action to find possible plaintiffs for these cases," he says.

At the same time, companies with affirmative action policies in place can

expect that the Equal Employment Opportunity Commission and the Office ofFederal Contract Compliance Programs will have more resources under

Obama and be more aggressive about enforcing affirmative action policies.

The majority ofFortune 1,000 companies have contracts with the

government, and thus have affirmative action policies, experts say.

Under the George W. Bush administration, agencies like the OFCCP saw

their budgets cut, so they werent as effective as they could have been, says

Renee Dunman, president of the Affirmative Action Association, a group of

diversity and affirmative action officers from private and public organizations.

In fiscal 2008, President George W. Bush requested a budget of $84.2 million

for the OFCCP, down from $85.2 million in 2006 and significantly down from

the $92.3 million requested in 2001. "I think Obama is going to look at that

budget and say, No wonder you cant do the compliance piece, " she says.

Experts also predict that under the Obama administration, the OFCCP will

have more support from the Office of the Solicitor General, which tries

OFCCP cases.

"I believe that the solicitors office will be supporting more of the

OFCCPs demands," says Valerie Hoffman, a partner in the law firm Seyfarth

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Shaw. "It means that employers will need to spend additional energy ensuring

that they can defend a failure-to-hire case and that their applicant tracking

systems are accurate," she says.

Also, experts believe the EEOC and the OFCCP will be more rigidnot

only looking at the composition of an organizations workforce to ensure that

it is complying with affirmative action policies, but also closely analyzing how

organizations are paying minorities compared with non-minorities in the sameroles.

Specifically, some experts believe that the OFCCP will return to using the

Equal Opportunity Survey, a reporting tool that allowed the agency to collect

information on companies compensation data and affirmative action

programs. The program was dropped in 2006, but Mark Bendick, partner at

Bendick and Egan Economic Consultants, a Washington-based diversity

consultant that helped evaluate the tool in 2006, believes the Obama

administration will bring back the survey.

"It would mean that the federal government is going to be in a better

position to know when there are glass-ceiling problems and wage

discrimination going on within companies," Bendick says.

For HR and diversity executives confronting push back about spending

money on diversity issues, this increased enforcement may help explain the

business case behind these measures, Bendick says.

"HR staffs within companies that have affirmative action will now have

more ammunition with which to go to the CEO and make their case, becauseenforcement is going to be more stringent," he says.

Redefining diversity

Opponents of affirmative action cite a television interview with Obama last

spring as a sign that he agrees with their stance. In that interview,

commentator George Stephanopoulos asked whether Obama thought his

daughters should get affirmative action protections. Obama responded, "I

think that my daughters should probably be treated by any admissions officer

as folks who are pretty advantaged."

Obama added: "I think that we should take into account white kids who


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have been disadvantaged and have grown up in poverty and shown themselves

to have what it takes to succeed."

While diversity experts dont believe that this is a sign that Obama will do

away with affirmative action edicts, they do agree that it may mean that the

administration will encourage more emphasis on recruiting candidates from

various socioeconomic backgrounds.

Focusing on socioeconomic status is "very cutting edge" and just now is

starting to be part of the diversity discussions at some employers, Bendick

says. "Companies that are really trying to establish diversity initiatives around

the business case are finding that they have to be more sophisticated about

how they define diversity," he says.

Bendick offers the example of a retail client that has traditionally hired

African-Americans to work in its stores in inner-city neighborhoods.

"The assumption was that African-American customers would relate toAfrican-American salespeople," he says. But the client hired middle-class

African-American college graduates and soon discovered these salespeople

had no cultural connection with the customers.

"The salespeople were as much strangers to this low-income minority

neighborhood as their white colleagues," he says. So Bendick is working with

the client to hire salespeople from a similar background to that of its

customers, which might have nothing to do with race, he says.

For many companies, hiring a workforce from different socioeconomic

backgrounds will mean going beyond the list of universities and colleges

where they usually recruit, says Peter Bye, president of MDB Group, a

Livingston, New Jersey-based diversity consultant.

Often to attract minority candidates, companies will go to historically black

colleges, which are excellent sources of talent, he says. "But now lets also

consider the City University of New York, which has more African-American

students than all of the historically black universities, and they have as many

Latino students, but they are more diverse from a socioeconomic standpoint,"

Bye says.


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Merrill Lynch has been trying to focus on socioeconomic diversity through

its recruiting, Barry says.

For the past five years, Merrill has been the lead sponsor of a summer

program for inner-city high school students through Rice University in

Houston. Through Rices Summer Business Institute, each year 40 to 50 high

school students from 10 of Houstons inner-city schools are invited to take two

weeks of business courses. Merrill invites the students into its offices and hascreated a mentorship program. "A handful of exceptional students get

internships at Merrill," Barry says.

Merrill has hired four students as interns from the program. Now that

Merrill has been acquired by Bank of America, Barry and her team are

looking to establish this model abroad with similar arrangements with Hong

Kong universities as well educational institutions in London, Barry says.

"My goal is to do this in major centers where we have large operations,"

she says. "We believe there is a huge opportunity to create a pipeline for futuretalent while also having a positive social impact."

Socioeconomic diversity is on the radar at Citigroup as well, although no

formal plans have been established, says Duarte McCarthy, the companys

chief diversity officer.

Right now the focus at Citigroup is on multiculturalism, and diversity

executives believe that having a biracial president will raise awareness around

this topic.

"Its helpful that Obama seems to be comfortable discussing some of the

race issues very explicitly and matter-of-factly," Bendick says, noting that

when a reporter asked Obama what kind of dog the family was going to get,

he responded that he wanted "a mutt like me."

"I thought that comment was very helpful in expressing a tone that says,

Its all right to talk about race, " Bendick says.

Citigroup has been trying to focus on multicultural issues for some time.

Duarte McCarthy is trying to get the companys employee affinity groups,

which are organized by race or ethnicity, to interact more. Not only would this


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help each group pool its resources, but it also addresses the fact that there are

many employees who could be members of several affinity groups.

"We are really trying to get more of these groups to do more together, more

unity-type programming," Duarte McCarthy says.

Merrill Lynch is also trying to get its affinity groups to hold more events

together to promote multiculturalism, Barry says. "Im really thinking aboutapproaching things with this multicultural lens as opposed to having silos

based on race and gender," she says.

Barry wants to establish cross-network groups that could organize events

for the various affinity groups within the company. She also is looking into

ways that the company could measure employee attendance at these events. "I

have seen this at other firms," she says.

Ideally, Barry wants to establish a requirement of how many events an

employee has to attend per year and that would become part of the employeesperformance evaluation. "People may initially attend events because they have

to check a box, but they stay and learn and it benefits everyone," she says.

The economy

While diversity executives are energized by Obamas election, they say that

in this economic climate, getting diversity initiatives to be front and center in

top executives minds can be challenging.

But these are the times that its more important than ever for companies to

prove their dedication to diversity issues, executives say.

Citigroup is making it a point to continue with diversity events that it sees

as core to its business, Duarte McCarthy says. In fact, on November 17the

same day that the company announced it would be laying off 52,000

employeesthe firm held its annual Womens Leadership Development

Program, which invites 31 female employees to its Armonk, New York,

development center for three days of seminars.

"Some people were surprised that we continued with the program," Duarte

McCarthy says. "But we feel its important to send a strong message that we

are going to continue to focus on developing talent. And that might mean in


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2009, there will be more potluck dinners and brown bag lunches," she says.

At Merrill, the activities might shift, but not the intent behind them, Barry

says.

"We now focus on retention as much as we are focused on recruiting," she

says. "So the focus may change, but the ability to be nimble and adapt makes

us smarter."

Workforce ManagementOnline, February 2009 --Register Now!

Jessica Marquez is New York bureau chief for Workforce Management.

[email protected] to comment.

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bridgepartnersllcwrote:

It is refreshing to see that the election of a leader who represents many aspects of

diversity multiculturalism, ethnic and cultural background (and even in the group that

consists of past and present Presidents, age) has inspired at least some US companies

and public sector institutions to take a broader approach to diversity. Maybe this could

even be defined as a less US-centric approach, embracing global diversity imperatives

such as socioeconomic status and multiculturalism. However, while the election of

President Obama may have served as the catalyst for this change, we believe the workwill fall mainly on the shoulders of progressive institutions - and society as a whole - to

proactively make an impact with regard to diversity and social responsibility in every

aspect of their day-to-day operations...regardless of, or even in spite of, economic

challenges. Bridge Partners LLC, an executive search firm that focuses on the recruitment

of diverse, senior-level executives, believes that federal initiatives such as EEOC and

OFCCP have served an important function in the past. However, in a corporate setting,

compliance can only go so far in establishing a successful, diverse work environment.

There is a strong business case and economic imperative for companies from all sectors

to embrace diversity initiatives, both of which need to be highlighted to ensure success.

Ultimately, if attracting and developing diverse employees isnt a companys primary

concern, there is nothing that the mere existence of President Obama can do to

strengthen that companys reputation as an employer of choice. Tory Clarke, Partner,

Bridge Partners LLC http://www.bridgepartnersllc.com

Thursday, February 12, 109 1:25:20 PM

ozhrwrote:

Ok, so perhaps I am a little naive but doesn't it - in this day and age - just come down to

the right person for the job? It seems to in Australia in my humble opinion. From what I

have read, President Kennedy first introduced affirmative action in 1961, it was very

important at the time and over the next few decades but as we now live and work in a

global village, haven't we started to reap the rewards and embrace everyone's

differences? How boring it would be if we were all the same! I have only ever hired the

best person for the job; their colour, religion, sex, socioeconomic background and so on

doesn't make the slightest difference to me as long as they can do the job that I am

recruiting for. President Obama, for all intents and purposes, was voted by the American

people to be the right man for the job; I think it would be insulting to him if he thought he

was voted in just because he was African-American? I work for a successful smallcompany with 40 or so full time employees plus another 30 part time or casual employees;

of these we currently have 14 nations represented and a fairly even split of men and

women employees - we have a pretty much even number of male and female managers

too. It works really well for us; we have diversity management issues at times but on the

whole any issues usually come down to a communication problem and are easily rectified.

We have a great team; great social club and great morale - people enjoy coming to work.

The election of the first African-American president of the United States will not redefine

our workplace diversity, or place a greater emphasis on multiculturalism and

socioeconomic status for us; it just confirms that we are on the right track and gives hope

for a more united global future.

Tuesday, February 10, 109 9:35:25 PM


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amribewrote:

". . .when a reporter asked Obama what kind of dog the family was going to get, he

responded that he wanted 'a mutt like me.'" A lot goes into a mutt and mutts often have a

more diverse set of experiences than the so-called pure bred. President Obama's

campaign and election created a huge window of opportunity for the diversity

conversation. In fact, in my opinion it has actually created a real "diversity" conversation

vs. what we have been conversing about post-Civil Rights--race relations. While our

intention has been inclusive, our actual dialogue has been less than inclusive and not at

all significantly transcendent. In making the transition for transformation, we have to

acknowledge our dichotomous dynamics of race and not cease in seeking equity on this

basis. Simultaneously, can we go deeper into what it means to innovation, team dynamics,

the empowerment of many vs. the few, and global competitiveness? Yes we can! I am

looking forward to it! Amri Johnson


strat_thinkwrote:

"There is an acknowledgement that when the highest officer of the land is an African-

American, there will be people who will say, Why do we need these programs anymore? "

he says. What else should people be saying? Shouldn't we celebrate the breaking of a

barrier as being symbolic of a movement that has reached a high water mark. We should

spend less time worrying about how to continue these programs under the old banners

and more time determining what the next frontier looks like. Why not focus on identifyingand driving the skills that make diverse team effective. That would add to the productive

capacity of every organization in the country. If the government were to sponsor the

creation of research and free training in this area, a bunch of consultants might be

unhappy, but our businesses could leapfrog the rest of the world. Diversity applied to

getting work done? Sounds pretty cool to me.


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Diversity: The Obama Effect

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