Sen. Bob Menendez Releases Corporate Diversity Survey, Says Latinos 'Grossly Underrepresented'
In an effort to expand diversity, U.S. Sen. Robert Menendez, D-N.J., released his report about corporate America's diversity.
"We all deserve a seat at the table," wrote Menendez, chair of the Senate Democratic Hispanic Task Force.
"The fair representation of women and minorities in corporate board rooms, C-suites, and in procurement practices is both the right thing to do and good for business," Menendez added. "With the purchasing power of Latino and black consumers each exceeding an estimated $1 trillion, racial and ethnic minorities are now more relevant than ever in driving economic growth across all industries."
According to the senator, companies must have diverse leadership in order to have a competitive advantage and perform better. With diversity across board and senior management positions, companies are more likely to meet the needs of consumers, stakeholders and marketplaces.
The report, titled "The 2014 Corporate Diversity Survey," is the third edition monitoring the progress of the U.S.'s leading companies. For the 2014 survey, Menendez stated he focused on Fortune 100 companies "in order gain deeper insight into the best practices and greatest challenges facing our nation's top-performing companies."
Companies volunteered to be part of Menendez's survey. It was not mandatory. The report disclosed 69 Fortune 100 companies participated in the questionnaire process.
"Truly increasing diversity in Corporate America requires time and a collective willingness to assess where we are and what adjustments must be made to move us closer to where we need to be," continued Menendez in the report. "We are at a critical juncture in which companies that prioritize diversity must take greater risks and make a more concerted effort than ever before to align their diversity values with their business practices, and my hope is that this survey is a valuable tool in that integration process."
Menendez revealed there have been more diversity efforts among the participating companies during 2014 than 2013. He highlighted Intel Corporation's $300 million fund to improve its diversity efforts and gain women and minorities within the technology sector.
Based on the latest report, a "vast" majority of participating companies have formal written diversity strategies and implementation plan that is reevaluated every year. Of the 69 companies, 9.2 percent had numeric targets for diversity and inclusion at board levels. Numeric targets were also in place in executive levels, according to 53.8 percent of the volunteering companies.
While there have been gains in having women and minorities in board of director positions, they are still "grossly underrepresented" compared to white men. White men were found to comprise 63 percent of the board of directors in the 69 companies while women represented 22.9 percent
While four companies did "not have a single racial or ethnic minority on their board," Latinos represented 4.9 percent of directors, although 35 companied did not have at least one Latino director. In comparison to the 2011 report, Latinos represented 3.7 percent of board members. In the latest report, 63.4 percent of Latino board members were reportedly U.S. citizens, while 17.1 percent were non-U.S. citizens or immigrants, however, citizenship status was not disclosed for 19.5 percent of board members with a Latino.
African Americans fared better as they represented 10 percent of directors, but nine companies did not have a single black director. Asians represented 3.3 percent of directors, while 47 companies did not have one Asian director. Native Americans accounted for the worst statistic as 0 percent were accounted as directors.
Women of color represented 4.2 percent of directors, but 41 companies did not include a woman of color.
On executive levels, white men continue to dominate, with 69.7 percent of senior positions in 69 of the Fortune 100 companies. Women represented 20.9 percent of executive team members, however, two companies revealed they have no female representation on executive levels.
Forty-five companies did not have a single Latino senior executive, but they did represent 2.9 percent of executive team members. African Americans represented 4.7 percent of executive team members, while 4.2 percent were Asians. Native American representation was present with only one corporation.
Menendez's report made several recommendations. One recommendation is for CEOs to make diversity "a visible priority." The report stated, "A clear and direct message from the CEO establishing diversity and inclusion as an organizational goal cultivates an internal mindset that diversity is valued. This must extend beyond a company's mission statement and include structured, strategic, and regular communication between the company's leadership and those directly responsible for improving diversity and inclusion at the company."
The report also recommended executive diversity councils as an effort to connect diversity while achieving business objectives. The report highlighted the progress AT&T and Chevron on this recommendation.
According to the report, every Fortune 100 company received a letter to participate in the survey in July 2014, and deadlines were extended to further include companies' results. The 69 participating Fortune 100 companies included American Express, Bank of America, Exxon Mobil, FedEx, General Electric, Microsoft, Target, Verizon and Walt Disney Corporation.
To view the 2014 Corporate Diversity Survey, click here.
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