A top-down approach is still crucial to effective inclusion practices. A business imperative is becoming clear.
By Andy Teng
 
With 35 percent of the country’s population comprised of minorities, no wonder employers increasingly are aware of the need for a workforce reflecting the diversity of its client base. Not only is this a socially desirable goal, but also it pays dividends in economic returns because customers want to buy from companies that offer equal employment opportunities. Moreover, many employers are keenly aware of the compliance implications of a diverse workforce, especially under the scrutiny of a more vigilant presidential administration.
 
However, workforce diversity continues to be a contentious issue in Corporate America, where efforts to be inclusive have varied from one company to another. In some cases, employers have embraced the concept by aggressively hiring employees of different race, religion, age, and sexual orientation at every level of employment, spanning from hourly, rank-and-file associates to CEOs. Furthermore, these organizations have full-fledged recruitment programs aimed at reaching out to diverse communities to ensure that their hiring programs are not just quota-based. At the other end of the spectrum, many businesses are still entrenched in discriminatory practices—knowingly or not. These organizations remain well behind the times, putting themselves at risk for punitive action by regulators, shareholders, and customers.
 
So when it comes to recruitment efforts, especially outsourced programs, HR leaders understand what’s at stake if they fail to ensure diversity in the workplace. Regulatory compliance is just one critical aspect; the sheer economic impact can be significant on any company’s bottom line. Furthermore, the public relations nightmare of being viewed as a discriminatory employer can haunt companies for years to come. Clearly, businesses have incentives to ensure their hiring practices are inclusive.
 
A Media Giant’s View
These concerns were certainly top of mind for HR executives at Wolters Kluwer, the global publishing and information services giant with 20,000 employees worldwide. Its diversity program is driven from the top down, with CEO Nancy McKinstry emphasizing the benefits of diversity in its workforce. That has trickled throughout the organization, with the message being spearheaded by HR executives such as Michael Pilnick, chief HR officer of Wolters Kluwer North American Shared Services (NASS). He explained that the company is not interested in embracing diversity programs simply as a PR gimmick; rather, it wants to ensure its efforts produce business results.
 
“None of our diversity programs were started just for diversity sake; it’s all for business needs. We believe that HR really needs to match its activities to the market. We are always changing. If it (a program) is not adding to revenues or somehow adding to organic growth, we will not do it.”
 
Pilnick explained that Wolters Kluwer embraced the idea and actively worked toward a diverse workforce years ago and that this philosophy is now entrenched in all of its human capital practices. Just as the company has had to evolve as a result of the digital revolution in publishing and information services, it has also focused its recruitment efforts to reflect its changing base of customers. Along the way, HR supported its business partners to attract and retain workers who can better relate and sell to these new clients.
 
“Diversity is no different from any other business initiative. It’s forced us to look at diversity of staff. The truth of the matter is, if we are not open to new ways of thinking in this organization, we would lose the battle,” he added. “We very smartly have matched our sales workforce to our clients’ needs—urban environments as well as other cultural needs.”
 
Although the company internally drives its recruitment efforts, it outsources some functions to gain best practices. For instance, it uses Berkshire Associates, one of the biggest providers of affirmative action hiring technology and services in the U.S. Pilnick said his company outsources EEOC reporting so HR can focus on more strategic initiatives; in addition, the consulting firm has helped the publishing giant strengthen its hiring practices through data and process analysis.
 
Wolters Kluwer is one example of hiring diversity driven from the top down. However, it also is an exception among global companies, where white males continue to account for most CEOs and executive board members. In fact, a look at the 2008 Fortune 25 reveals that only 20 percent of the CEOs are non-white males, and of the Fortune 50 for the year, none of the companies employed a woman CEO.
 
These facts are reasons why Corporate America, as well as companies around the world, still struggles with diversity issues, said Melodie Toby, a faculty member at Kean University in Union, NJ, who teaches sociology and social justice. An expert on workforce diversity, Toby said the problem most companies have with diversity is that the boardroom continues to be mostly homogenous. And until there is more equitable representation of the changing demographics, companies will never fully comprehend what the term means.
 
“One of the things that concerns me is that top management has to send the signal throughout the company. I’m very concerned that boards of director do not reflect our society. If you looked at boards of companies, you would think our society is overwhelmingly white male,” she said. “My suggestion is to have boards become more diverse. They need those goals. It’s an accountability issue.”
 
With some exceptions such as Pepsi or Xerox, which Toby singled out for their groundbreaking diversity programs, corporations largely have failed to become more inclusive, not only at the hourly, associate levels, but also in management, she said. Toby questioned whether diversity was just a feel-good catchphrase for some businesses and an avoidance for others. Most surprisingly, she noted, at a time when the country has its first African-American president and when attitudes on social changes such as gay marriage are turning around, companies are still discussing the issue of workforce diversity when it should have become embedded in their standard operating procedures.
 
The Outsourcer’s Role
Even when employers try to become more inclusive in their recruitment efforts, many miss the mark. That’s because unless their internal recruiters have experience in finding candidates of color or are minorities themselves, businesses often don’t understand the nuances of reaching out to various groups. They don’t understand effective branding and messaging for minorities, where to source candidates, or how to reach target candidates.
 
That’s when an outsourced solution can be highly effective—to source candidates as well as help ensure that a customer’s program is compliant with regulations. After all, recruitment providers contend with diversity engagement issues all the time and can offer a host of helpful advice around best practices, policy development, and EEOC-related issues.
 
It’s a service with which Michael Beygelman is familiar. As senior vice president for North America at Adecco, he heads up the company’s RPO offering, which has supported clients’ efforts to shore up their diversity programs. The RPO leader does this in several ways:

• During pre-service, it examines the client’s existing recruitment processes, making sure that they aren’t violating EEOC requirements or their own policies. Working with one client, it discovered that the company was asking inappropriate questions in its screening step.
• To help clients better take stock of their diversity program, Adecco also performs in-depth reporting for some clients; others run their own reports. It is able to capture information that can help identify candidates who qualify for tax credits, such as workers displaced by Hurricane Katrina a few years ago.
• It also advises on how to recruit for minorities in communities in which the client wants to do business. It may choose specific locations, advertise on niche media, or use alternative channels to reach these candidates. It also engages in partnerships with companies such as MAGIC Workforce Solutions, a Magic Johnson-owned minority staffing firm based in Los Angeles.

 
Beygelman said companies must be sensitive to the groups they want to reach and not apply an umbrella approach for everyone. “You want to develop a strategy to add sourcing, venues, and media outlets that have an affinity with the kind of candidates you want to attract,” he advised.
 
He observed that employers are becoming segregated into those who are interested in the best candidate regardless of color and those who want qualified candidates who reflect their customer base. He added that RPO providers have an opportunity to become leaders in this field, helping customers reach a diverse pool of candidates. However, whether providers are willing to invest in this capability will determine during the next few years if they become true domain experts or follow in the footsteps of their clients.
 
One way for RPO providers to gain a greater understanding of inclusive hiring practices is to partner with a knowledgeable provider such as MAGIC Workforce. Nicole Ganier-Cosme, the president of the firm, said her organization helps clients change their approach so that branding and messaging resonate with urban workers. Working with several Fortune 500 companies including national retailer Best Buy, her firm leverages its contact within urban communities to reach appropriate candidates.
 
She lamented the fact that many companies who want a more diverse workforce fail to put people of color in hiring-decision roles. As a result, recruiters don’t understand that minorities are motivated by different criteria than mainstream America.
 
“It’s not just the message but also the messenger, and in the minority community that’s very powerful. I think there is still a lot of education that has to happen” in Corporate America, she added, noting that urban consumers are sensitive to whether a company projects a diverse, customer-facing workforce.
 
As the country’s demographics continue to shift, recruitment practices undoubtedly will have to as well. The days of employing a homogenous workforce are nearing an end if they haven’t already for a large swath of employers. With outsourced service providers already providing domain expertise in many aspects of recruitment, their ability to contribute on the diversity front might be just another layer of value companies can leverage.