TABLEOFCONTENTS

ACKNOWLEDGEMENTS

EXECUTIVESUMMARY RESULTSOFTHE2010CORPORATEDIVERSITYSURVEY WRITTENDIVERSITYSTRATEGYANDIMPLEMENTATIONPLANS DIVERSITYONCORPORATEBOARDS DIVERSITYONEXECUTIVETEAMS SUPPLIERDIVERSITY

5 6 8 10 16 19 25 27 30 37 44 47 50 51 52

DISCUSSIONOFDIVERSITYWHENSEARCHINGFORCORPORATELEADERSHIP DIVERSITYONCORPORATEBOARDSBYINDUSTRY DIVERSITYONEXECUTIVETEAMSBYINDUSTRY

IMPACTOFWRITTENDIVERSITYPLANSONBOARDDIVERSITY

IMPACTOFWRITTENDIVERSITYPLANSONEXECUTIVEDIVERSITY IMPACTOFWRITTENDIVERSITYPLANSONSUPPLIERDIVERSITY CONCLUSIONS MOVINGFORWARD BESTPRACTICES RECOMMENDATIONS

NONRESPONSIVECORPORATIONS

55

ACKNOWLEDGEMENTS Iwanttopersonallythankthosecompaniesthatchosetocompletemycorporatediversitysurvey. Oneofmytoppriorities,astheonlyHispanicservingintheUnitedStatesSenate,istopromote andexpanddiversityatalllevelsofoureconomic,politicalandsocialsectors.Asmanyareaware, I have been concerned for a number of years with the poor level of minority and female representation on corporate boards and among senior executives across major corporations in thiscountry. The goal of this corporate diversity survey is very straightforward to gain a better understanding of what minority and female representation looks like on corporate boards, in seniorleadershipandintheprocurementofgoodsandservices.Iamextremelypleasedtohave received more than 200 completed surveys from corporations that share my commitment to improvingtherepresentationofminoritiesandwomenatthehighestlevel. AlthoughthissurveywasvoluntaryandImadeclearthatIwouldnotrevealanyindividualdata thatwassubmittedbyanycorporation,completingthissurveyandrevealingsuchdatamaynot have been an easy decision. I appreciate those who did respond, and as a way to distinguish betweenthosewhodidanddidnotrespond,Ihavelistedattheendofthisreportthenamesof corporations who were nonresponsive, including those who opted to respond with a letter or somethingotherthanaresponsetothequestionnaire.Iplantomakethissurveyaregulareffort, and by including this list, I hope that next time more corporations will make the decision to respond. Now that the data has been compiled, it is critical that we move forward with an actionplan to improvediversityamongtheleadershipoftopcorporations.ThatiswhyIhaveincludedasetof key recommendations that I believe will be useful to corporations looking to improve their diversity. I believe that ensuring diversity among corporate leadership is not merely the right thing to do, but is good for business. In fact, those corporations that have boards and senior managementthatarereflectiveoftodaysdemographicswillbebetterpositionedtocompeteamid achangingmarket. Enclosedwiththisreportyouwillfindananalysisofthedataaswellasrecommendationsderived from the anecdotal information I received over the course of data gathering for this project. Although I realize that not all solutions can be legislated, it is my hope that by bringing public attention to this critical issue, we can take steps that bring us closer to our shared goals of diversity.

EXECUTIVESUMMARY AbouttheSurvey A voluntary corporate diversity survey was sent to 537 corporations ranked as Fortune 500 corporations in either 2009 or 2010. The survey requested the following information from corporations: 1) whether or not they have written diversity plans with targets, 2) data on diversityattheBoardandexecutivemanagementlevel,and3)informationonsupplierdiversity. Atotalof219ofthosecorporationscompletedthesurvey,whichbringsourtotalresponserateto about 41%. Of that total, 71 companies are ranked as 2010 Fortune 100 corporations. Three corporationssubmittedtheirsurveytoolatetobeincludedinthefinaltally;however,theirresults wouldhavehadaminimalimpactonoveralldata. Thepurposeofthesurveyistogainanoverviewofhowcloselytheleadershipofournationstop 500 corporations reflects the diversity of our nation. Today, women represent more than 50% our population, and minorities together make up more than 35% of our population combinedi. Blacks/African Americans number more than 37 million, Asians make up more than 13 million andHispanics/Latinoscomprisemorethan45million.iiYet,thosenumbersarehardlyreflectedin theleadershipofournationstopcorporations. Thereisnodoubtthatcorporationsarereapingrecordprofitsinpartbytappingintothebuying power of women and minority communities. According to the U.S. Womens Chamber of Commerce, women control $4.3 trillion in U.S. consumer spending.iii And according to the Selig Center for Economic Growth, as of 2009, the purchasing power of the Black/AfricanAmerican, Hispanic/Latino and Asian communities is estimated at $910 billion, $978 billion and $508.6 billion, respectivelyiv. Given the importance of these communities to corporate profits, it is imperativethattheyberepresentedatthedecisionmakingtableofthesecorporations. This survey seeks to bring awareness to the importance of diversity among our leading corporations,andtorecommendstepstowardachievingthesegoals. HighlightsofDataCollected DiversityonCorporateBoards White/Caucasian men comprise nearly 68% of Directors. Of all the categories included in the survey, women have the highest number of Board members, although their proportional representationonBoardswaslessthanonehalfoftheirproportiontotheoverallU.S.population. Whenadjustingthecalculationforwomenwhoarealsoofminoritybackground,White/Caucasian men represent 71.06% of Directors, and women and minorities together represent 28.94%. Blacks/African Americans have the highest representation compared to their population, reportingaBoardratioofabout69%.Asiansalsohavehighrepresentation,atabouthalfoftheir overallproportionofthepopulation. However, when you combine all minorities, the percentage of representation dropped to only 14.45%, less than half of the 35% of the population they comprise overall in this country. 3

Hispanics have one of the poorest representations on Boards. They comprise about 3.28% of Board members, onefifth of the 15% they represent in the U.S. population. Native Americans madeupabout.04%ofBoardmembers,approximately5%oftheiractualpopulation. Foodproducts/servicesindustryhasthehighestrepresentationofbothminoritiesandwomenon average. Specifically, women fare best in the food products/services industry, insurance, science/technology and, media/entertainment/marketing industries. Blacks/AfricanAmericans fare better than any other minority groups across all industries, but do the best in the food products/services industry and in financial services. Hispanics fare best among aero/defense/transportationandfoodproducts/servicesindustry. DiversityonExecutiveTeams(CEOanddirectreports) White/Caucasian men comprise nearly 70% of executive team members. Women fare slightly betteronexecutiveteamsthanoncorporateBoards,yetstillrepresentlessthanonehalfoftheir population. Minorities overall have less representation on executive teams than they do on corporateBoards,representing10.44%ofexecutivemanagers,comparedto30%oftheiractual proportion to the U.S. population. When adjusting the calculation for women who are also of minority background, White/Caucasian men represent 71.85% of executive team members, and womenandminoritiestogetherrepresent28.15%. Blacks/African Americans saw the greatest decline in representation from Boards to executive management teams, 8.77% to 4.23%. In fact, they went from about one out of every 11 Board members to one out of every 24 executive team members. When compared to population statistics,Blacks/AfricanAmericansonexecutiveboardsrepresentedonlyaboutonethirdoftheir U.S.population. Hispanics/Latinos fare worse on executive teams versus corporate Boards at2.90%, Asians and NativeAmericansdoslightlybetterat2.55%and.25%respectively. Whenexecutiveteamdiversitywasanalyzedbyindustry,womenfarebestamongtheinsurance andretailindustries.Blacks/AfricanAmericansfarebetterthanmostminoritygroupsacrossall industries,butfarebestintheenergyandfoodproducts/servicesindustries.Hispanicsdobetter as well in the food products/services industry and Asians fare better than all groups in the telecomm/computer/businessservicesindustry. SupplierDiversity Oneoftherealdisappointmentsofthissurveywasthelackofspecificracialandethnicdataon suppliers. In total, only 98 corporations (less than half of respondents) provided some form of data on supplier diversity, whether it wasby racial/ethnic category or just overall procurement with Minority Business Enterprises (MBEs). 118 corporations either chose not to answer the questionorsaidtheydonottrackthisdataatall.Ofthedatacollected: Minorityownedbusinessesrepresent7.02%oftotalprocurement. Hispanic/Latinoownedfirmsrepresent2.69%oftotalprocurement. Black/AfricanAmericanownedfirmsrepresent2.58%oftotalprocurement. Asianownedfirmsrepresent3.21%oftotalprocurement. 4

NativeAmericanownedfirmsrepresent0.83%oftotalprocurement. Otherminorityownedfirmsrepresent3.31%oftotalprocurement

WrittenDiversityStrategyandImplementationPlans An overwhelming majority (82%) of corporations that responded have formal written diversity plans,andaclearmajorityofthoseplanshavetargetsfordiversityattheexecutivemanagement and procurement level. Although having such plans with targets does generally correlate with higherlevelsofdiversity,itwasonlyaslightincrease. DiscussionofDiversityWhenEngagingExecutiveSearchFirms Thesurveyalsofoundthatadiscussionofdiversitywhenutilizingexecutivesearchfirmshavea positiveimpactonoveralldiversityattheexecutiveteamlevel,especiallyforAsians.AttheBoard level,adiscussionofdiversitydoesnotnecessarilyimproverepresentationofminorities,andat times,madeitworse. 5

ComprehensiveResults 2010CorporateDiversitySurvey

WRITTENDIVERSITYSTRATEGYANDIMPLEMENTATIONPLANS Question3ofthesurveyaskedwhethercorporationshaveaformal,writtendiversitystrategyand implementationplan.Thesecondpartofthatquestionrequestedinformationonwhetherthose planshavetargetsfordiversityattheseniormanagementlevel,BoardofDirectorlevelandinthe procurementofgoodsandservices.Foreachquestion,dataispresentedforbothFortune500and Fortune100companies.

Question3 Doesyourcorporationcurrentlyhaveaformalwrittendiversitystrategyandimplementationplan? Yes No a. Doesthisplanincludetargetsfordiversityandinclusionattheseniormanagementlevel? Yes No b. DoesthisplanincludetargetsfordiversityandinclusionattheBoardofDirectorslevel? Yes No c. Doesthisplanincludetargetsfordiversityandinclusionintheprocurementofgoodsandservices? Yes No

Fortune500Corporations Ofthe216responses,177Fortune500companies(81.9%)haveformal,writtendiversitystrategy andimplementationplans.Thirtyninecorporationsdonot,representing21.5%ofrespondents. 3a: Of those corporations that have a written plan (177), 64.4% (114) of those plans includetargetsfordiversityandinclusionattheseniormanagementlevel.35.6%(63)of corporationswithawrittenplandonothavetargets. 3b: Of those corporations that have a written plan (177), 26.6% (47) have targets for diversityandinclusionattheBoardofDirectorlevel.73.4%(130)ofthosewithawritten plandonothavetargets. 3c: Of those corporations that have a written plan (177), 65.5% (116) have targets for diversityandinclusionintheprocurementofgoodsandservices.34.5%(61)ofthosewith awrittenplandonothavetargets. Fortune100Corporations SixtyfiveFortune100corporations,outofatotal71thatrespondedtothesurvey(91.54%),have formal,writtendiversitystrategyandimplementationplans.Sixcorporationsdonot,representing 8.45%ofFortune100respondents. 3a:Ofthosecorporationsthathaveawrittenplan(65),67.70%(44)ofthoseplansinclude targets for diversity and inclusion at the senior management level. 32.31% (21) of corporationswithawrittenplandonothavetargets. 7

 3b:Ofthosecorporationsthathaveawrittenplan(65),26.15%(17)ofthoseplansinclude targetsfordiversityandinclusionattheBoardofDirectorlevel.73.85%(48)ofthosewith awrittenplandonothavetargets. 3c: Of those corporations that have a written plan (65), 72.31% (47) have targets for diversity and inclusion in the procurement of goods and services. 27.69% (18) of those withawrittenplandonothavetargets.

DISCUSSIONOFDIVERSITYWHENSEARCHINGFORCOMPANYLEADERSHIP Question 5 asked corporations about the discussion of diversity when engaging executive search firmstofillleadershippositionsatthehighestlevelsoftheircompany.
Question5 WhenengaginganexecutivesearchfirmforseniormanagementorBoardpositions,doesyourcorporationcommonly discusstheissueofdiversitywiththatfirm? Yes No

Fortune500Corporations Anoverwhelmingmajorityofcorporations(197)outofatotal216thatresponded,or91.2%, said they discuss the issue of diversity when engaging executive search firms for senior management or Board positions. Eighteen corporations or 8.3% either responded no or simplydidnotanswerthequestion. Ofthosecorporationsthatansweredyes(177)tohavingawrittendiversityplaninquestion3, 93.8% (166) of them also discuss diversity when engaging executive search firms for senior management.Only6.2%(11)saidtheydonotdiscussdiversity. Ofthose39corporationsthatanswerednotohavingawrittendiversityplan(question3),31 or79.5%doinfactdiscussdiversitywhenengagingexecutivesearchfirms.Only6or15.4%of thosecorporationsthatanswerednotoquestion3alsodonotdiscussdiversitywhenengaging executivesearchfirms. Fortune100Corporations SixtysixFortune100corporationsoutofatotal71thatresponded,or92.96%,saidtheydo discusstheissueofdiversitywhenengagingexecutivesearchfirmsforseniormanagementor Board positions. Five corporations or 7.58% either responded no or did not answer the question. When looking at this question in relation to those corporations that answered yes (66) to having a written diversity plan (question 3), 92.42% (61) of corporations that have written plansalsodiscusseddiversitywhenengagingexecutivesearchfirmsforseniormanagement. Only7.58%(5)saidtheydonotdiscussdiversity. Of the six corporations that answered no to having a written diversity plan (question 3), 83.33%or5ofthosecorporationsdoinfactdiscussdiversitywhenengagingexecutivesearch firms.Only1corporationthatanswerednotoquestion3alsodoesnotdiscussdiversitywhen engagingexecutivesearchfirms. 9

DIVERSITYONCORPORATEBOARDS Question 6 requested diversity statistics from corporations on the makeup of their Board of Directors. This question also requested information on disability status of Board members, althoughmanycorporationsdonottrackthisdataduetoprivacyconcerns.
Question6 PleasedescribethedemographicmakeupofyourcorporationsBoardofDirectors. a. TotalnumberofBoardmembers__________ b. NumberofBoardmembersthatarewomen__________ c. NumberofBoardmembersthatareminority__________ Hispanic/Latino _____ NativeAmerican_____ Black/AfricanAmerican _____ Other _____ Asian _____ NumberofBoardmembersthathaveaknowndisability_________

Fortune500Corporations White/Caucasianmencomprise67.51%ofDirectors.Overall,womenfarebetterthanminorities when it came to representation on these Boards. Blacks/African Americans fare better than Hispanics/Latinos,Asians,NativeAmericansandOtherminorities. 6a,TotalBoard:TheaveragetotalnumberofBoardmembersis11.7. 6b,Women:Womenrepresent18.04%ofDirectors;1outofevery5Boardmembersisfemale. 22corporationshave4ormorewomenontheirBoard.[Figure1,2] 6c, Minority: Minorities represent 14.45% of Directors; 1 out of every 7 Board members is a minority.Fiftyonecorporationshave3ormoreminoritiesontheirBoard.[Figure1,3] 6b&c, Minority Women: Minority women comprise 3.55% of Directors on average; 1 out of every 28 Board members is a minority woman. When adjusting the calculation for women who are also of minority background, White/Caucasian men represent 71.06% of Board members,andbothwomenandminoritiestogethercomprise28.94%.[Figure4] 6c, Hispanic/Latino: Hispanics/Latinos comprise 3.28% of Directors; 1 out of every 31 BoardmembersisHispanic/Latino.Thismeansthat,onaverage,youwillhavetosurvey3 corporateBoardstofindevenoneHispanic.Eightcorporationshave2Hispanics/Latinos ontheirBoard.Nocorporationhasmorethan2Hispanics/LatinosontheirBoard.[Figure 5] 6c,Black/AfricanAmerican:Blacks/AfricanAmericanscomprise8.77%ofDirectors;1out ofevery11BoardmembersisBlack/AfricanAmerican,averagingouttoabout1perBoard. Eightcorporationshave3ormoreBlacks/AfricanAmericansontheirBoard.[Figure5] 10

6c, Asian: Asians comprise just 1.99% of Board members; 1 out of every 50 Directors is Asian, or 1 per 5 corporate Boards. 2 corporations have 2 Asians on their Board. No corporationhasmorethan2AsiansontheirBoard.[Figure5] 6c, Native American: Native Americans comprise 0.04% of Directors; 1 out of every 2500 Board members is Native American. Only 1 corporation out of all 216 respondents has 1 Native American on its Board. No corporation has more than 1 Native American on its Board.[Figure5] 6c, Other: Other minorities comprise 0.38% of Directors; 1 out of every 263 Board members is categorized as Other minority. One corporation has 3 Other minorities on its Board.Nocorporationhasmorethan3OtherminoritiesontheirBoard.[Figure5] 6c, Disabled: Disabled persons comprise 0.44% of Directors; 1 out of every 227 Board members of Fortune 500 corporations that track disabilities has a disability. Fiftyfour corporations,25%ofFortune500respondents,donottrackdisabilities.

BoardRoomDemographics
Women 18.04% Minority 14.45%

CaucasianMen 67.51%

Figure 1

11

NumberofCompanieswithWomenDirectors
96.00 100.00 90.00 80.00 70.00 60.00 50.00 40.00 30.00 20.00 10.00 0Women 1woman 2women Figure 2 3women 4+Women 8.00 49.00 41.00

22.00

NumberofCompanieswithMinorityDirectors
78.00 80.00 70.00 60.00 50.00 40.00 30.00 20.00 10.00 0 1minority 2minority Figure 3 3minority 4+minority 26.00 16.00 35.00 60.00

12

BoardMemberDemographics

Minorities+Females 28.94% CaucasianMales 71.04%

Figure 4

BoardMemberDemographics
Women 18.04%

Hispanic/Latino 3.28% Black/African American 8.77%

WhiteMen 67.51% Asian 1.99% Native American <1%

Other Minority <1%

Figure 5

13

Fortune100Corporations FortheFortune100,White/Caucasianmencomprise64.53%oftotalDirectors.Minoritiesoverall doslightlybetteronFortune100BoardsthanFortune500Boards,butwomendoslightlyworse [Figure 6]. Blacks/African Americans saw the greatest increase, while Hispanics/Latinos saw a slightdecrease.NoFortune100companyhasanyNativeAmericanorOtherminorityDirectors. 6a,TotalBoard:TheaveragetotalnumberofBoardmembersis12.5. 6b, Women: Women comprise 19.87% of Directors; one out of every 5 Board members is female.Thirtycorporationshave3ormorewomenontheirBoard.[Figure6] 6c, Minority: Minorities comprise 15.60% of Directors; one out of every 6 Board members is minority.Twentyonecorporationshave3ormoreminoritiesontheirBoard.[Figure6] 6b&c,MinorityWomen:Minorityfemalescomprise3.63%ofDirectors;1outofevery28Board members is a minority woman. When adjusting the calculation for women who are also of minoritybackground,White/Caucasianmenrepresent68.17%ofBoardMembers,andwomen andminoritiestogetherrepresent31.83%. 6c, Hispanic/Latino: Hispanics/Latinos comprise 3.05% of Directors; one out of every 33 BoardmembersisHispanic/Latino.Onecorporationhas2Hispanics/LatinosonitsBoard. Nocorporationhasmorethan2Hispanics/LatinosontheirBoard.[Figure7] 6c,Black/African American:Blacks/AfricanAmericanscomprise10.40%ofDirectors;one out of every 10 Board members is Black/African American. Four corporations have 3 or moreBlacks/AfricanAmericansontheirBoard.[Figure7] 6c,Asian:Asianscomprise1.67%ofBoardmembers;oneoutofevery60Boardmembersis Asian. One corporation has 2 Asians on its Board. No corporation has more than 2 Asian Directors.[Figure7] 6c,NativeAmerican:NoBoardhasanyNativeAmericans. 6c,Other:NoBoardhasanyOtherminorities.

6c,Disabled:FortyeightcorporationstrackdisabilitiesamongDirectors.Disabledpersons comprise0.35%ofcorporateBoardmembers.Thismeansthat1outofevery286Board members of Fortune 100 corporations that track disabilities have a disability. 32% of Fortune100respondentsdonottrackdisabilities.

14

BoardRoomDemographics
Women 19.87% Minority 15.60% CaucasianMales 64.53%

Figure 6

BoardRoomDemographics
Women 19.87%

Hispanic/Latino 3.05%

CaucasianMales 64.53%

Black/African American 10.40% Asian Other 1.67% Minority Native <1% American <1% Figure 7

15

DIVERSITYONCORPORATEBOARDSBYINDUSTRY Corporationsweredividedintobroadindustrycategories.Representationofwomenandminoritieswascomparedtototal revenueamongthosecompaniesthatarepartofthoseindustries.

Industry Aero/Defense/Transp ortation Energy FinancialServices Food Products/Services Hardware/Technology /Science Health/Medical Insurance Manufacturing/ Industrial/Products Media/Entertainment /Marketing Retail Telecomm/Computers /BusinessServices

Total Co's 15 26 29 15 5 29 16 21 5 17 25

Revenue (millions) 333,665.50 931,813.80 964,950.20 263,643.40 70,771.40 870,012.90 383,078.60 575,354.20 100,607.30 822,516.30 665,718.20

Total Board Seats 164 307 382 180 51 338 202 232 59 202 286

Women 21 48 71 42 14 62 43 40 13 39 47

Minority 24 48 60 38 6 39 33 28 11 26 38

Hispanic /Latino 10 8 8 10 1 7 9 7 2 8 11

Black/Africa nAmerican 13 30 40 21 4 26 19 19 6 11 21

Asian 1 7 8 7 1 5 2 3 3 5 4

Native American 0 1 0 0 0 0 0 0 0 0 0

Other

Minority Women 4 12 14 13 3 7 5 5 4 10 6

0 0 6 0 0 1 0 0 0 0 2

16

BoardofDirectors
30.0%
27.5%

25.0%

23.3% 21.1% 21.3% 18.3% 16.3% 17.2% 22.0% 19.3% 16.4% 12.9% 11.8% 11.5% 12.1% 13.3%

20.0%
15.6% 15.6%

18.6% 15.7%

18.6%

15.0%

14.6% 12.8%

10.0%

Women Minorities

5.0%

0.0%

Figure 8

17

BoardofDirectors
12.0%

10.0%

8.0%

6.0%

Hispanic AfricanAmerican

4.0%

Asian NativeAmericans Other

2.0%

MinorityWomen

0.0%

Figure 9

18

DIVERSITYONEXECUTIVETEAMS Question7requestedinformationaboutthemakeupofexecutiveteams,whicharecomprisedof CEOs and those who report directly to them. This question also requested information on disability status of team members, although some corporations do not track this data due to privacyconcerns.
Question7 Pleasedescribethedemographicmakeupofyourcorporationsexecutiveteam(CEOandhis/herdirectreports). a. Totalnumberofexecutiveteammembers__________ b. Numberofexecutiveteammembersthatarewomen__________ c. Numberofexecutiveteammembersthatareminority__________ Hispanic/Latino _____ NativeAmerican _____ Black/AfricanAmerican _____ Other _____ Asian _____ Numberofexecutiveteammembersthathaveaknowndisability_________

Fortune500Corporations White/Caucasian men comprise 69.56% of executive team members. Women do better on executiveteamsthanoncorporateBoards,butminoritiesasawholefareworse.Blacks/African Americans fare better compared to all other groups, and Asians fare better than Hispanics/Latinos.[Figures10,14] 7a,Totalexecutiveteam:Theaveragenumberofexecutiveteammembersis15.8. 7b, Women: Women comprise 20.00% of executive team members; one out of every 5 executive team members is female. Fortyfive corporations have 4 or more women on their team.[Figure10,11] 7c, Minority: Minorities comprise 10.44% of executive team members; one out of every 10 executiveteammembersisminority.Seventeencompanieshave4ormoreMinoritiesontheir team.[Figure10,12] 7b&c,MinorityWomen:Minoritywomenrepresent2.29%ofexecutiveteammembers;oneout ofevery35executiveteammembersisaminoritywoman.Whenadjustingthecalculationfor women who are also of minority background, White/Caucasian men represent 71.85% of executiveteammembers,andwomenandminoritiestogetherrepresent28.15%.[Figure13] 7c, Hispanic/Latino: Hispanics/Latinos comprise 2.90% of executive team members; one out of every 35 executive team members is Hispanic/Latino. Eight companies have 3 or moreHispanics/Latinosontheirteam.[Figure14] 19

7c, Black/African American: Black/African Americans comprise 4.23% of executive team members;oneoutofevery24executiveteammembersisBlack/AfricanAmerican.Eight corporationshave3ormoreBlacks/AfricanAmericansontheirteam.[Figure14] 7c,Asian:Asianscomprise2.55%ofexecutiveteammembers;1outofevery39executive teammembersisAsian.Tencompanieshave3ormoreAsiansontheirteam.[Figure14] 7c, Native American: Native Americans comprise 0.25% of executive team members; one outofevery434executiveteammembersisNativeAmerican.Nocompanymorethanone NativeAmericanontheirteam.[Figure14] 7c,Other:Otherminoritiesrepresent0.62%ofexecutiveteammembers;1outofevery161 executive team members is Other minority. Three corporations have 2 or more Other minoritiesontheirteam.[Figure14] personsonexecutiveteamscomprise0.44%ofexecutiveteammembers.Thismeansthat approximately 1 out of every 227 executive team members of corporations that track disabilitiesaredisabled.Fiftytwocorporations,roughly24%ofFortune500respondents, donottrackdisabilities.

7c,Disabled: 163corporationstrackdisabilitiesamongexecutiveteammembers.Disabled

ExecutiveTeamDemographics
Women 20.00% Minority 10.44%

CaucasianMen 69.56%

Figure 10

20

NumberofCompanieswithFemaleExecutive TeamMembers
58.00 60.00 50.00 40.00 30.00 20.00 10.00 0Women 1woman 2women Figure 11 3women 4+Women 14.00 52.00 47.00 45.00

NumbersofCompanieswithMinorityExecutive TeamMembers
63.00 70.00 60.00 50.00 40.00 30.00 20.00 10.00 0 1minority 2minority Figure 12 3minority 4minority 17.00 17.00 48.00 49.00

21

ExecutiveTeamDemographics

Minorities+Females 28.15%

CaucasianMales 71.85%

Figure 13

ExecutiveTeamDemographics
Women 20.00% Hispanic/Latino 2.90% Black African American 4.23% CaucasianMales 69.56% Asian 2.55% Native American <1% OtherMinority 1%

Figure 14

22

Fortune100Corporations White/Caucasianmenrepresent67.92%ofexecutiveteammembers.Womenandminoritiessaw little change from Board representation. Hispanics/Latinos fare worse among Fortune 100 corporations,butBlacks/AfricanAmericansandAsiansdobetter.[Figure15] 7a,Totalexecutiveteam:TheaveragenumberofFortune100executiveteamleadersis21.2. 7b, Women: Women comprise 20.61% of executive team members; one out of every 5 executive team members is female. Thirtysix companies have 3 or more women on their teams.[Figure15] 7c, Minority: Minorities comprise 11.47% of executive team members; 1 out of every 9 executiveteammembersisminority.Sixteencorporationshave3ormoreminoritiesontheir team.[Figure15] 7b&c,MinorityWomen:Executiveteammemberswhoareminoritywomencomprise1.99%of executive team members; one out of every 50 executive team members is both a minority female. When adjusting for women who are also of minority background, White/Caucasian men represent 69.91% of Board Members, and women and minorities together represent 30.09%. 7c, Hispanic/Latino: Hispanics/Latinos comprise 2.53% of executive team members; one outofevery40executiveteammembersisHispanic/Latino.Fourcorporationshave3or moreHispanics/Latinosontheirteam.[Figure16]

7c, Black/African American: Black/African Americans represent 5.78% of executive team members; one out of every 17 executive team members is Black/African American. Six corporationshave3ormoreBlacks/AfricanAmericansontheirteams.[Figure16] 7c,Asian:Asiansrepresent2.80%ofexecutiveteammembers;1outofevery36executive teammembersisAsian.Fivecompanieshave3ormoreAsiansontheirteam.[Figure16] 7c, Native American: Native Americans comprise 0.26% of executive team members; one outofevery385executiveteammembersisNativeAmerican.Nocompanyhasmorethan oneNativeAmericanontheirteam.[Figure16] 7c,Other:Otherminoritiescomprise0.41%ofexecutiveteammembers;oneoutofevery 244 executive team members is Other minority. Two corporations have 2 or more Other minoritiesontheirteam.[Figure16] Disabled persons on executive teams comprise 0.67% of executive team members. Approximately 1 out of every 149 executive team members of corporations that track disabilitiesisdisabled.Thirtyonepercentdonottrackdisabilities. 23

7c, Disabled: Fortynine corporations track disabilities among executive team members.

ExecutiveTeamDemographics
Women 20.61% Minority 11.47%

CaucasianMales 67.92%

Figure 15

ExecutiveTeamDemographics
Women 20.61% Hispanic/Latino 2.53% BlackAfrican American 5.78% WhiteMen 67.92% Asian 2.80% NativeAmerican <1% OtherMinority <1%

Figure 16

24

DIVERSITYONEXECUTIVETEAMSBYINDUSTRY Corporationsweredividedintobroadindustrycategories.Representationofwomenandminoritieswascomparedtototal revenueamongthosecompaniesthatarepartofthoseindustries.

Industry Aero/Defense/Transp ortation Energy FinancialServices Food Products/Services Hardware/Technology /Science Health/Medical Insurance Manufacturing/ Industrial/Products Media/Entertainment /Marketing Retail Telecomm/Computers /BusinessServices Total Co's 15 26 29 15 5 29 16 21 5 17 25 Revenue (millions) 333,665.50 931,813.80 964,950.20 263,643.40 70,771.40 870,012.90 383,078.60 575,354.20 100,607.30 822,516.30 665,718.20 Exec Team Total 160 364 477 192 58 365 174 347 58 193 900 Women 30 67 100 37 13 75 43 54 11 50 198 Minority 19 37 40 29 6 49 13 44 3 15 103 Hispanic /Latino 5 5 12 9 1 15 0 11 2 5 29 Black/African American 6 20 13 12 2 19 9 17 1 4 33 Asian 4 9 11 8 2 11 4 15 0 5 38 Native American 2 0 1 0 1 3 0 0 0 0 1
Other

Minority Women 1 2 5 10 1 11 4 5 2 6 20

2 9 3 3 0 1 0 2 0 1 2

25

ExecutiveTeamMembers
30.0%
25.9% 24.7%

25.0%
22.4% 21.0% 20.5% 19.3% 19.0% 22.0%

20.0%

18.8%

18.4%

15.1%

15.6% 13.4% 12.7%

15.0%
11.9% 10.2% 10.3% 8.4%

11.4%

10.0%

7.5% 5.2%

7.8%

Women Minorities

5.0%

0.0%

Figure 17

26

ExecutiveTeamMembers
7.0%

6.0%

5.0%

4.0% Hispanic 3.0% AfricanAmerican Asian 2.0% NativeAmericans Other 1.0% MinorityWomen

0.0%

Figure 18

27

SUPPLIERDIVERSITY Question8askedcorporationsabouttheprocurementofgoodsandservicestodiversesuppliers.
Question 8 Please describe the demographic make-up of your suppliers of goods and services. a. Percentage of goods and services procured from firms that are owned by: Hispanic/Latino Black/African American Asian _____ _____ _____ Native American Other _____ _____

Fortune500Corporations FortyonecorporationsprovidedthetotalpercentageofprocurementwithMinorityBusiness Enterprises (MBEs). Of those, 7.02% went to MBEs. Eightyfour corporations track procurementdatabyraceandethnicity. Hispanic/Latinoownedfirmsrepresent2.69%. Black/AfricanAmericanownedfirmsrepresent2.58%. Asianownedfirmsrepresent3.21%. NativeAmericanownedfirmsrepresent0.83%. Otherminorityownedfirmsrepresent3.31%.[Figure19] NinetyeightcorporationsprovidedanoverallpercentageforMBEsorbyspecificracial/ethnic category;118corporationschosenottoprovidethedataorsaidtheydonottracksuppliersby thosecategories.

Fortune500SupplierDiversity
Black/African Hispanic/Latino,American,2.58% Asian,3.21% 2.69% NativeAmerican, 0.83% OtherMinority,3.31%

Other*,87.38%

Figure19 *OtherincludesWomen,LGBT,Veteran,ServiceDisabledandWhite/Caucasianownedfirms.

28

Fortune100Corporations Sixteen corporations provided the total percentage of procurement with MBEs. Out those, 5.52%wenttoMBEs.Thirtythreecorporationstrackprocurementdatabyraceandethnicity Hispanic/Latinoownedfirmsrepresent3.36%. Black/AfricanAmericanownedfirmsrepresent3.91%. Asianownedfirmsrepresent4.06%. NativeAmericanownedfirmsrepresent1.61%. Otherminorityownedfirmsrepresent5.40%.[Figure20] Fortyseven companies provided an overall percentage for MBES or percentages by specific racial/ethnic category. Twentyfour corporations chose not to provide the data and/or said theydonottracksuppliersbythosecategories.

Fortune100SupplierDiversity
Hispanic/Latino, 3.36% Black/African Asian,4.06% American, 3.91% Native American, 1.61%

OtherMinority, 5.40%

Other*,81.66%

Figure2019 *OtherincludesWomen,LGBT,Veteran,ServiceDisabledandWhite/Caucasianownedfirms.

29

THE IMPACT OF A WRITTEN DIVERSITY STRATEGY AND A DISCUSSION OF DIVERSITY WHENUTILIZINGSEARCHFIRMSONCORPORATEBOARDDIVERSITY Thissectionanalyzestheimpactsofawrittendiversitystrategywithtargetsfordiversity(question 3), as well as a discussion of diversity when using executive search firms (question 5) on overall corporateBoarddiversity(question6). Fortune500Corporations Women Written Diversity Plans: The average percentage of women on corporate Boards is 18.04%. That percentage increases slightly to 18.34% among corporations with a written diversity plan,anddecreasesto16.70%amongcorporationsthatdonothaveaplan.Thismeansthat1 outofevery5Boardmembersisfemaleamongcorporationswithwrittenplans,asopposedto 1outofevery6forcorporationswithoutsuchplans. Written Diversity Plan with Targets: The percentage of women on corporate Boards is even higher,at21.50%,amongcorporationswithawrittendiversityplanandtargetsfordiversity attheBoardlevel. Discussion of Diversity When Engaging Executive Search Firms: Corporations that discussed diversity when engaging executive search firms have Boards that are 18.34% women. CorporationsthatdonotdiscussdiversitywhenengagingexecutivesearchfirmshaveBoards that are 15.40% women. This means that 1 out of every 5 Board members is female among companies that do discuss diversity when using such firms, as opposed 1 out of 6 among corporationsthatdonotdiscussdiversity. Minority WrittenDiversityPlans:TheaveragepercentageofminoritiesoncorporateBoardsis14.45%. That percentage increases to 15.52% among corporations with a written diversity plan, and decreases to 9.62% among corporations that do not have a plan. This means that 1 out of every6Boardmembersisminorityamongcorporationswithwrittenplans,asopposedto1 outofevery10forcorporationswithoutsuchplans. Written Diversity Plan with Targets: The percentage of minorities on corporate Boards increases to 17.78%, among corporations with a written diversity plan and targets for diversityattheBoardlevel.Thismeansthat1outofabout6Boardmembersisminority. Discussion of Diversity When Engaging Executive Search Firms: Corporations that discussed diversity when engaging executive search firms have Boards that are 14.45% minority. CorporationsthatdonotdiscussdiversitywhenengagingexecutivesearchfirmshaveBoards thatare15.51%minorityslightlymore. MinorityWomen Written Diversity Plans: The average percentage of female minorities on corporate Boards is 3.55%.Thatpercentageincreasesto3.81%amongcorporationswithawrittendiversityplan, 30

anddecreasesto2.42%amongcorporationsthatdonothaveaplan.Thismeansthat1outof every 26 Board members is a minority female among corporations with written plans, as opposedto1outofevery41forcorporationswithoutsuchplans. Written Diversity Plan with Targets: The percentage female minorities on corporate Boards increasesto4.43%,amongcorporationswithawrittendiversityplanandtargetsfordiversity attheBoardlevel.Therefore,1outofevery23Boardmembersisbothfemaleandminority whencorporationsusetargets. Discussion of Diversity When Engaging Executive Search Firms: Corporations that discussed diversitywhenengagingexecutivesearchfirmshaveBoardsthatare3.69%minorityfemale. CorporationsthatdonotdiscussdiversitywhenengagingexecutivesearchfirmshaveBoards thatare2.38%minorityfemale.Asaresult,whencorporationsdiscussdiversitywithasearch firm,1outofevery27Boardmembersisaminoritywoman.Ifcorporationsdonot,1outof every42Boardmembersisaminoritywoman.

Hispanic/Latino Written Diversity Plans: The average percentage of Hispanics/Latinos on corporate Boards is 3.28%. That percentage increases slightly to 3.57% among corporations with a written diversity plan, and decreases to 1.98% among corporations that do not have a plan. This means that 1 out of every 28 Board members is Hispanic/Latino among corporations with writtenplans,asopposedto1outofevery50forcorporationswithoutsuchplans. WrittenDiversityPlanwithTargets:ThepercentageofHispanics/LatinosoncorporateBoards increasesto4.47%,amongcorporationswithawrittendiversityplanandtargetsfordiversity at the Board level. Among such corporations, Hispanics/Latinos number 1 out of every 22 Boardmembers. Discussion of Diversity When Engaging Executive Search Firms: Corporations that discussed diversitywhenengagingexecutivesearchfirmshaveBoardsthatare3.25%Hispanic/Latino. CorporationsthatdonotdiscussdiversitywhenengagingexecutivesearchfirmshaveBoards thatare4.05%Hispanic/Latinoslightlymore. Black/AfricanAmerican Written Diversity Plans: The average percentage of Blacks/African Americans on corporate Boards is 8.77%. That percentage increases slightly to 9.45% among corporations with a written diversity plan, and decreases to 5.72% among corporations that do not have a plan. This means that 1 out of every 11 Board members is Black/African American among corporationswithwrittenplans,asopposedto1outofevery17forcorporationswithoutsuch plans. WrittenDiversityPlanwithTargets:ThepercentageofBlacks/AfricanAmericansoncorporate Boardsincreasesto10.16%,amongcorporationswithawrittendiversityplanandtargetsfor diversity at the Board level. Among such corporations, Blacks/African Americans number 1 outofevery10Boardmembers. 31

Discussion of Diversity When Engaging Executive Search Firms: Corporations that discussed diversity when engaging executive search firms have Boards that are 8.76% Black/African American. Corporations that do not discuss diversity when engaging executive search firms haveBoardsthatare9.31%Black/AfricanAmericanslightlymore.

Asian WrittenDiversityPlans:TheaveragepercentageofAsiansoncorporateBoardsis1.99%.That percentageincreasesslightlyto2.09%amongcorporationswithawrittendiversityplan,and decreases to 1.53% among corporations that do not have a plan. This means that 1 out of every48BoardmembersisAsianamongcorporationswithwrittenplans,asopposedto1out ofevery65forcorporationswithoutplans. WrittenDiversityPlanwithTargets:ThepercentageofAsiansoncorporateBoardsincreasesto 2.67%,amongcorporationswithawrittendiversityplanandtargetsfordiversityattheBoard level.Amongsuchcorporations,Asiansnumber1outofevery37Boardmembers. Discussion of Diversity When Engaging Executive Search Firms: Corporations that discussed diversity when engaging executive search firms have Boards that are 2.13% Asian. CorporationsthatdonotdiscussdiversitywhenengagingexecutivesearchfirmshaveBoards thatare0.59%Asian.Thismeansthat1outofevery47BoardmembersisAsianifdiversityis discussed when using executive search firms compared to 1 out of 169 if diversity is not discussed. NativeAmerican Written Diversity Plans: The average percentage of Native Americans on corporate Boards is 0.04%. That percentage decreases to 0% among corporations with a written diversity plan, andincreasesto0.21%amongcorporationsthatdonothaveplans. WrittenDiversityPlanwithTargets:ThepercentageofNativeAmericansoncorporateBoards staysat0%,amongcorporationswithawrittendiversityplanandtargetsfordiversityatthe Boardlevel. Discussion of Diversity When Engaging Executive Search Firms: Corporations that discussed diversitywhenengagingexecutivesearchfirmshaveBoardsthatare0.04%NativeAmerican. CorporationsthatdonotdiscussdiversitywhenengagingexecutivesearchfirmshaveBoards thatare0%NativeAmerican. OtherMinority Written Diversity Plans: The average percentage of Other minorities on corporate Boards is 0.38%. That percentage decreases slightly to 0.36% among corporations with a written diversityplan,andincreasesto0.51%amongcorporationsthatdonothaveaplan. WrittenDiversityPlanwithTargets:ThepercentageofOtherminoritiesoncorporateBoardsis 0.24%,amongcorporationswithawrittendiversityplanthatalsohavetargetsfordiversityat theBoardlevel. 32

Discussion of Diversity When Engaging Executive Search Firms: Corporations that discuss diversity when engaging executive search firms have Boards that are .32% Other minority. CorporationsthatdonotdiscussdiversitywhenengagingexecutivesearchfirmshaveBoards thatare1.18%Otherminority.

Disabled Written Diversity Plans: The average percentage of disabled persons on corporate Boards is 0.44%.Thatpercentagedecreasesto0.40%amongcorporationswithawrittendiversityplan, andincreasesto0.58%amongcorporationsthatdonothaveaplan. WrittenDiversityPlanwithTargets:ThepercentageofdisabledpersonsoncorporateBoardsis 0.51%,amongcorporationswithawrittendiversityplanthatalsohavetargetsfordiversityat theBoardlevel. Discussion of Diversity When Engaging Executive Search Firms: Corporations that discuss diversity when engaging executive search firms have Boards that are 0.42% disabled. CorporationsthatdonotdiscussdiversitywhenengagingexecutivesearchfirmshaveBoards thatare0.65%disabled. Fortune100Corporations Women Written Diversity Plans: The average percentage of women on corporate Boards is 19.87%. That percentage increases slightly to 20.60% among corporations with a written diversity plan,anddecreasesto11.73%amongcorporationsthatdonothaveaplan.Thismeansthat1 outofevery5Boardmembersisfemaleamongcorporationswithwrittenplans,asopposedto 1outofevery9forcorporationswithoutsuchplans. Written Diversity Plan with Targets: The percentage of women on corporate Boards is even higher,at24.40%,amongcorporationswithawrittendiversityplanandtargetsfordiversity attheBoardlevel. Discussion of Diversity When Engaging Executive Search Firms: Corporations that discussed diversity when engaging executive search firms have Boards that are 20.27% women. CorporationsthatdonotdiscussdiversitywhenengagingexecutivesearchfirmshaveBoards that are 18.27% women. This means that 1 out of every 5 Board member is female among companies that discuss diversity when using search firms, as opposed 1 out of 6 among corporationsthatdonot. Minority WrittenDiversityPlans:TheaveragepercentageofminoritiesoncorporateBoardsis15.60%. That percentage increases to 16.43% among corporations with a written diversity plan, and decreases to 6.53% among corporations that do not have a plan. This means that 1 out of every6Boardmembersisminorityamongcorporationswithwrittenplans,asopposedto1 outofevery15forcorporationswithoutsuchplans. 33

Written Diversity Plan with Targets: The percentage of minorities on corporate Boards increasesto19.01%amongcorporationswithawrittendiversityplanandtargetsfordiversity attheBoardlevel. Discussion of Diversity When Engaging Executive Search Firms: Corporations that discussed diversity when engaging executive search firms have Boards that are 15.73% minority. CorporationsthatdonotdiscussdiversitywhenengagingexecutivesearchfirmshaveBoards thatare17.32%minority.

MinorityWomen Written Diversity Plans: The average percentage of minority women on corporate Boards is 3.63%.Thatpercentageincreasesto3.85%amongcorporationswithawrittendiversityplan, anddecreasesto1.28%amongcorporationsthatdonothaveaplan.Thismeansthat1outof every 26 Board members is a minority female among corporations with written plans, as opposedto1outofevery78forcorporationswithoutplans. Written Diversity Plan with Targets:ThepercentageofminoritywomenoncorporateBoards increasesto5.00%,amongcorporationswithawrittendiversityplanandtargetsfordiversity at the Board level. Meaning 1 out of every 20 Board members is a minority woman when corporationsusetargets. Discussion of Diversity When Engaging Executive Search Firms: Corporations that discussed diversitywhenengagingexecutivesearchfirmshaveBoardsthatare3.78%minorityfemale. CorporationsthatdonotdiscussdiversitywhenengagingexecutivesearchfirmshaveBoards thatare2.08%minorityfemale. Hispanic/Latino Written Diversity Plans: The average percentage of Hispanics/Latinos on corporate Boards is 3.05%.Thatpercentageincreasesto3.20%amongcorporationswithawrittendiversityplan, anddecreasesto1.39%amongcorporationsthatdonothaveaplan.Thismeansthat1outof every 31 Board members is Hispanic/Latino among corporations with written plans, as opposedto1outofevery72forcorporationswithoutsuchplans. WrittenDiversityPlanwithTargets:ThepercentageofHispanics/LatinosoncorporateBoards increasesto3.38%,amongcorporationswithawrittendiversityplanandtargetsfordiversity at the Board level. Among such corporations, Hispanics/Latinos number 1 out of every 30 Boardmembers. Discussion of Diversity When Engaging Executive Search Firms: Corporations that discussed diversitywhenengagingexecutivesearchfirmshaveBoardsthatare3.02%Hispanic/Latino. CorporationsthatdonotdiscussdiversitywhenengagingexecutivesearchfirmshaveBoards thatare4.29%Hispanic/Latino. 34

Black/AfricanAmerican Written Diversity Plans: The average percentage of Blacks/African Americans on corporate Boards is 10.40%. That percentage increases slightly to 10.86% among corporations with a written diversity plan, and decreases to 5.47% among corporations that do not have a plan. This means that 1 out of every 9 Board members is Black/African American among corporationswithwrittenplans,asopposedto1outofevery18forcorporationswithoutsuch plans. WrittenDiversityPlanwithTargets:ThepercentageofBlacks/AfricanAmericansoncorporate Boardsincreasesto11.05%,amongcorporationswithawrittendiversityplanandtargetsfor diversity at the Board level. Among such corporations, Blacks/African Americans number 1 outofevery9Boardmembers. Discussion of Diversity When Engaging Executive Search Firms: Corporations that discussed diversity when engaging executive search firms have Boards that are 10.65% Black/African American. Corporations that do not discuss diversity when engaging executive search firms haveBoardsthatare8.87%Black/AfricanAmerican. Asian WrittenDiversityPlans:TheaveragepercentageofAsiansoncorporateBoardsis1.67%.That percentageincreasesslightlyto1.83%amongcorporationswithawrittendiversityplan,and decreasesto0%amongcorporationsthatdonothaveaplan. WrittenDiversityPlanwithTargets:ThepercentageofAsiansoncorporateBoardsincreasesto 2.86%,amongcorporationswithawrittendiversityplanandtargetsfordiversityattheBoard level.Amongsuchcorporations,Asiansnumber1outofevery35Boardmembers. Discussion of Diversity When Engaging Executive Search Firms: Corporations that discussed diversity when engaging executive search firms have Boards that are 1.65% Asian. CorporationsthatdonotdiscussdiversitywhenengagingexecutivesearchfirmshaveBoards thatare5.50%Asian. NativeAmerican NoFortune100hasanyNativeAmericansontheirBoardofDirectors. OtherMinority NoFortune100hasanyOtherminorityontheirBoardofDirectors. Disabled Written Diversity Plans: The average percentage of disabled persons on corporate Boards is 0.35%. That percentage increases slightly to 0.40% among corporations with a written diversityplan,anddecreasesto0%amongcorporationsthatdonothaveaplan. Written Diversity Plan with Targets: No corporation with both a written diversity plan and targetsfordiversityattheBoardlevelhasanydisabledpersonsontheirBoardofDirectors. 35

Discussion of Diversity When Engaging Executive Search Firms: Corporations that discuss diversity when engaging executive search firms have Boards that are 0.37% disabled. CorporationsthatdonotdiscussdiversitywhenengagingexecutivesearchfirmshaveBoards thatare0%disabled.

36

THE IMPACT OF A WRITTEN DIVERSITY STRATEGY AND A DISCUSSION OF DIVERSITY WHENUTILIZINGSEARCHFIRMSONEXECUTIVETEAMDIVERSITY Thissectionanalyzestheimpactawrittendiversitystrategyandtargetsfordiversity(question3),as well the impact a discussion of diversity when using executive search firms (question 5), has on overallexecutiveteamdiversity(question7).AnanalysisisdoneforbothFortune500andFortune 100companies. Fortune500Corporations Women WrittenDiversityPlans:Theaveragepercentageofwomenonexecutiveteamsis20.00%.That percentageincreasesslightlyto20.61%amongcorporationswithawrittendiversityplan,and decreases to 17.24% among corporations that do not have a plan. This means that 1 out of every5executiveteammembersisfemaleamongcorporationswithwrittenplans,asopposed to1outofevery6forcorporationswithoutsuchplans. WrittenDiversityPlanwithTargets:Thepercentageofwomenonexecutiveteamsisaboutthe sameasthosewithjustawrittenplan(20.59%)amongcorporationsthatalsohavetargetsfor diversityattheexecutivelevel. Discussion of Diversity When Engaging Executive Search Firms: Corporations that discussed diversitywhenengagingexecutivesearchfirmshaveexecutiveteamsthatare19.93%women. Corporations that do not discuss diversity when engaging executive search firms have executiveteamsthatare20.29%womenslightlymore. Minority Written Diversity Plans: The average percentage of minorities on executive teams is 10.44%. That percentage increases to 10.96% among corporations with a written diversity plan, and decreases to 8.08% among corporations that do not have a plan. This means that 1 out of every 9 executive team members is minority among corporations with written plans, as opposedto1outofevery12forcorporationswithoutsuchplans. WrittenDiversityPlanwithTargets:Thepercentageofminoritiesonexecutiveteamsincreases to 11.98%, among corporations with a written diversity plan and targets for diversity at the executivelevel. Discussion of Diversity When Engaging Executive Search Firms: Corporations that discussed diversity when engaging executive search firms have executive teams that are 10.58% minority. Corporations that do not discuss diversity when engaging executive search firms haveBoardsthatare9.30%minority,morethanonepercentagepointless. MinorityWomen Written Diversity Plans: The average percentage of minority women on executive teams is 2.29%. That percentage decreases slightly to 2.18% among corporations with a written diversityplan,andincreasesto2.76%amongcorporationsthatdonothaveaplan. 37

Written Diversity Plan with Targets: The percentage of minority women on executive teams decreasesto2.04%amongcorporationswithawrittendiversityplanandtargetsfordiversity attheexecutivelevel. Discussion of Diversity When Engaging Executive Search Firms: Corporations that discussed diversitywhenengagingexecutivesearchfirmshaveexecutiveteamsthatare2.29%minority female.Corporationsthatdonotdiscussdiversitywhenengagingexecutivesearchfirmshave executiveteamsthatare1.77%minoritywomen.Thismeansthatfemaleminoritiesrepresent 1 out of every 44 executive team members among corporations that discuss diversity when engagingsearchfirms,asopposedto1outof56iftheydonot.

Hispanic/Latino Written Diversity Plans: The average percentage of Hispanics/Latinos on executive teams is 2.90%. That percentage decreases slightly to 2.82% among corporations with a written diversityplan,andincreasesto3.26%amongcorporationsthatdonothaveaplan. Written Diversity Plan with Targets: The percentage of Hispanics/Latinos onexecutiveteams increasesto3.30%,amongcorporationswithawrittendiversityplanandtargetsfordiversity attheexecutivelevel.Amongsuchcorporations,Hispanics/Latinosnumber1outofevery30 executiveteammembers. Discussion of Diversity When Engaging Executive Search Firms: Corporations that discussed diversity when engaging executive search firms have executive teams that are 3.00% Hispanic/Latino.Corporationsthatdonotdiscussdiversitywhenengagingexecutivesearch firmshaveexecutiveteamsthatare2.03%Hispanic/Latinoanentirepercentagepointless. Black/AfricanAmerican Written Diversity Plans: The average percentage of Blacks/African Americans on executive teams is 4.23%. That percentage increases slightly to 4.44% among corporations with a written diversity plan, and decreases to 3.28% among corporations that do not have a plan. Thismeansthat1outofevery23executiveteammembersisBlack/AfricanAmericanamong corporationswithwrittenplans,asopposedto1outofevery30forcorporationswithoutsuch plans. WrittenDiversityPlanwithTargets:ThepercentageofBlacks/AfricanAmericansonexecutive teams increases to 5.00%, among corporations with a written diversity plan and targets for diversityattheexecutivelevel.Amongsuchcorporations,Blacks/AfricanAmericansnumber 1outofevery20executiveteammembers. Discussion of Diversity When Engaging Executive Search Firms: Corporations that discussed diversity when engaging executive search firms have executive teams that are 4.24% Black/AfricanAmerican.Corporationsthatdonotdiscussdiversitywhenengagingexecutive search firms have executive teams that are 3.84% Black/African American, roughly half a percentagepointless. 38

Asian WrittenDiversityPlans:TheaveragepercentageofAsiansonexecutiveteamsis2.55%.That percentageincreasesslightlyto2.88%amongcorporationswithawrittendiversityplan,and decreases to 1.09% among corporations that do not have a plan. This means that 1 out of every35executiveteammembersisAsianamongcorporationswithwrittenplans,asopposed to1outofevery92forcorporationswithoutsuchplans. Written Diversity Plan with Targets: The percentage of Asians on executive teams remains unchanged at 2.88%, among corporations with a written diversity plan and targets for diversityattheexecutivelevel.

NativeAmerican Written Diversity Plans: The average percentage of Native Americans on executive teams is 0.23%. That percentage increases minimally to 0.28% among corporations with a written diversityplan,anddecreasesto0%amongcorporationsthatdonothaveaplan. Written Diversity Plan with Targets: The percentage of Native Americans on executive teams decreasesslightlyto0.22%,amongcorporationswithawrittendiversityplanandtargetsfor diversityattheexecutivelevel.

Discussion of Diversity When Engaging Executive Search Firms: Corporations that discussed diversity when engaging executive search firms have executive teams that are 2.73% Asian. Corporations that do not discuss diversity when engaging executive search firms have executiveteamsthatare0.88%Asianmuchless.Thismeansthat1outofevery37executive teammembersisAsianifdiversityisdiscussedwhenusingsearchfirmscomparedto1outof 114ifdiversityisnotdiscussed.

Discussion of Diversity When Engaging Executive Search Firms: Corporations that discussed diversity when engaging executive search firms have executive teams that are 0.21% Native American. Corporations that do not discuss diversity when engaging executive search firms haveexecutiveteamsthatare0.49%NativeAmerican.

OtherMinority Written Diversity Plans: The average percentage of Other minorities on executive teams is 0.62%. That percentage increases slightly to 0.66% among corporations with a written diversityplan,anddecreasesto0.45%amongcorporationsthatdonothaveaplan. Written Diversity Plan with Targets: The percentage of Other minorities on executive teams increases slightly to 0.76%, among corporations with a written diversity plan that also have targetsfordiversityattheexecutivelevel.

Discussion of Diversity When Engaging Executive Search Firms: Corporations that discuss diversity when engaging executive search firms have executive teams that are 2.29% Other minority. Corporations that do not discuss diversity when engaging executive search firms haveexecutiveteamsthatare1.77%Otherminority,roughlyhalfapercentagepointless.

39

Disabled Written Diversity Plans: The average percentage of disabled persons on executive teams is 0.44%. That percentage increases slightly to 0.56% among corporations with a written diversityplan,anddecreasesto0%amongcorporationsthatdonothaveaplan. WrittenDiversityPlanwithTargets:Thepercentageofdisabledpersonsonexecutiveteamsis 0.59%,amongcorporationswithwrittendiversityplansthatalsohavetargetsfordiversityat theBoardlevel.

Discussion of Diversity When Engaging Executive Search Firms: Corporations that discuss diversity when engaging executive search firms have Boards that are 0.24% disabled. CorporationsthatdonotdiscussdiversitywhenengagingexecutivesearchfirmshaveBoards thatare2.83%disabled.

Fortune100Corporations Women WrittenDiversityPlans:Theaveragepercentageofwomenonexecutiveteamsis20.61%.That percentageincreasesslightlyto21.28%amongcorporationswithawrittendiversityplan,and decreases to 13.37% among corporations that do not have a plan. This means that 1 out of every5executiveteammembersisfemaleamongcorporationswithwrittenplans,asopposed to1outofevery7forcorporationswithoutsuchplans. WrittenDiversityPlanwithTargets:Thepercentageofwomenonexecutiveteamsisincreases slightlyto22.72%amongcorporationswithtargetsfordiversityattheexecutivelevel. Discussion of Diversity When Engaging Executive Search Firms: Corporations that discussed diversitywhenengagingexecutivesearchfirmshaveexecutiveteamsthatare20.99%women. Corporations that do not discuss diversity when engaging executive search firms have executiveteamsthatare16.44%women. Minority Written Diversity Plans: The average percentage of minorities on executive teams is 11.47%. Thatpercentagebarelyincreasesto11.84%amongcorporationswithawrittendiversityplan, anddecreasesto7.56%amongcorporationsthatdonothaveaplan.Thismeansthat1outof every 8 executive team members is minority among corporations with written plans, as opposedto1outofevery13forcorporationswithoutsuchplans. WrittenDiversityPlanwithTargets:Thepercentageofminoritiesonexecutiveteamsincreases to12.14%,amongcorporationswithbothawrittendiversityplanandtargetsfordiversityat theexecutivelevel. Discussion of Diversity When Engaging Executive Search Firms: Corporations that discussed diversity when engaging executive search firms have executive teams that are 11.65% 40

minority. Corporations that do not discuss diversity when engaging executive search firms haveBoardsthatare11.44%minority,slightlyless. MinorityWomen Written Diversity Plans: The average percentage of minority women on executive teams is 1.99%. That percentage decreases slightly to 2.08% among corporations with a written diversity plan, and decreases to 0.98% among corporations that do not have a plan. This meansthat1outofevery48executiveteammembersisminorityfemaleamongcorporations withwrittenplans,asopposedto1outofevery102forcorporationswithoutsuchplans. Written Diversity Plan with Targets: The percentage of minority women on executive teams increasesto2.30%amongcorporationswithawrittendiversityplanandtargetsfordiversity attheexecutivelevel.

Discussion of Diversity When Engaging Executive Search Firms: Corporations that discussed diversitywhenengagingexecutivesearchfirmshaveexecutiveteamsthatare2.14%minority female.Corporationsthatdonotdiscussdiversitywhenengagingexecutivesearchfirmshave executiveteamsthatare0%minorityfemale.

Hispanic/Latino Written Diversity Plans: The average percentage of Hispanics/Latinos on executive teams is 2.53%. That percentage decreases slightly to 2.43% among corporations with a written diversityplan,andincreasesto3.64%amongcorporationsthatdonothaveaplan. Written Diversity Plan with Targets: The percentage of Hispanics/Latinos onexecutiveteams increasesto2.65%,amongcorporationswithawrittendiversityplanandtargetsfordiversity attheexecutivelevel. Discussion of Diversity When Engaging Executive Search Firms: Corporations that discussed diversity when engaging executive search firms have executive teams that are 2.72% Hispanic/Latino.Corporationsthatdonotdiscussdiversitywhenengagingexecutivesearch firmshaveexecutiveteamsthatare0%Hispanic/Latino. Black/AfricanAmerican Written Diversity Plans: The average percentage of Blacks/African Americans on executive teams is 5.78%. That percentage increases to 6.01% among corporations with a written diversity plan, and decreases to 3.36% among corporations that do not have a plan. This means that 1 out of every 17 executive team members is Black/African American among corporationswithwrittenplans,asopposedto1outofevery30forcorporationswithoutsuch plans. WrittenDiversityPlanwithTargets:ThepercentageofBlacks/AfricanAmericansonexecutive teams increases to 6.41%, among corporations with awritten diversity planthat hastargets for diversity at the executive level. Among such corporations, Blacks/African Americans number1outofevery16executiveteammembers. 41

Discussion of Diversity When Engaging Executive Search Firms: Corporations that discussed diversity when engaging executive search firms have executive teams that are 5.62% Black/AfricanAmerican.Corporationsthatdonotdiscussdiversitywhenengagingexecutive searchfirmshaveexecutiveteamsthatare9.96%Black/AfricanAmerican,almostdouble.

Asian WrittenDiversityPlans:TheaveragepercentageofAsiansonexecutiveteamsis2.80%.That percentage increases to 3.06% among corporations with a written diversity plan, and decreasesto0%amongcorporationsthatdonothaveaplan. WrittenDiversityPlanwithTargets:ThepercentageofAsiansonexecutiveteamsdecreasesto 2.73%,amongcorporationswithawrittendiversityplanthathastargetsfordiversityatthe executivelevel.

Discussion of Diversity When Engaging Executive Search Firms: Corporations that discussed diversity when engaging executive search firms have executive teams that are 2.92% Asian. Corporations that do not discuss diversity when engaging executive search firms have executiveteamsthatare1.47%Asian,almosthalfasmuch.Thismeansthat1outofevery34 executiveteamshasanAsianifdiversityisdiscussedwhenusingsearchfirmscomparedto1 outof68ifdiversityisnotdiscussed.

NativeAmerican Written Diversity Plans: The average percentage of Native Americans on executive teams is 0.26%. That percentage increases minimally to 0.28% among corporations with a written diversityplan,anddecreasesto0%amongcorporationswithoutaplan. Written Diversity Plan with Targets: The percentage of Native Americans on executive teams increasesslightlyto0.41%,amongcorporationswithawrittendiversityplanthathastargets fordiversityattheexecutivelevel.

OtherMinority Written Diversity Plans: The average percentage of Other minorities on executive teams is 0.41%. That percentage decreases slightly to 0.39% among corporations with a written diversityplan,andincreasesto0.56%amongcorporationsthatdonothaveaplan. Written Diversity Plan with Targets: The percentage of Other minorities on executive teams increasesslightlyto0.44%,amongcorporationswithawrittendiversityplanwithtargetsfor diversityattheexecutivelevel.

Discussion of Diversity When Engaging Executive Search Firms: Corporations that discussed diversity when engaging executive search firms have executive teams that are 0.28% Native American. Corporations that do not discuss diversity when engaging executive search firms haveexecutiveteamsthatare0%NativeAmerican.

Discussion of Diversity When Engaging Executive Search Firms: Corporations that discuss diversity when engaging executive search firms have executive teams that are .35% Other 42

minority. Corporations that do not discuss diversity when engaging executive search firms haveexecutiveteamsthatare1.47%Otherminority. Disabled Written Diversity Plans: The average percentage of disabled persons on executive teams is 0.67%. That percentage increases slightly to 0.75% among corporations with a written diversityplan,anddecreasesto0%amongcorporationsthatdonothaveaplan. WrittenDiversityPlanwithTargets:Thepercentageofdisabledpersonsonexecutiveteamsis 0.79% among corporations with a written diversity plan that has targets for diversity at the Boardlevel.

Discussion of Diversity When Engaging Executive Search Firms: Corporations that discuss diversity when engaging executive search firms have Boards that are 0.59% disabled. CorporationsthatdonotdiscussdiversitywhenengagingexecutivesearchfirmshaveBoards thatare2.94%disabled.

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THEIMPACTOFAWRITTENDIVERSITYSTRATEGYONSUPPLIERDIVERSITY Thissectionanalyzestheimpactawrittendiversitystrategywithtargetsfordiversityatthesupplier level(question3)hasonsupplierdiversity(question8). Fortune500Corporations Hispanic/Latino WrittenDiversityPlans:Onaverage,2.69%ofgoodsandservicescontractedoutareawarded to Hispanic/Latino firms. That percentage decreases to 2.46% among corporations with a writtendiversityplan,andincreasesto4.38%amongcorporationsthatdonothaveaplan. Written Diversity Plan with Targets: The percentage of total procurement to Hispanic/Latino firms decreasesto 2.29%, among corporations with awritten diversity planthat andtargets fordiversityatthesupplierlevel. Black/AfricanAmerican WrittenDiversityPlans:Onaverage,2.58%ofgoodsandservicescontractedoutareawarded to Black/African American firms. That percentage increases to 2.80% among corporations withawrittendiversityplan,butdecreasesto0.92%amongcorporationsthatdonothavea plan. Written Diversity Plan with Targets: The percentage of total procurement to Black/African Americanfirmsincreasesto2.88%,amongcorporationswithawrittendiversityplanthatand targetsfordiversityatthesupplierlevel. Asian WrittenDiversityPlans:Onaverage,3.21%ofgoodsandservicescontractedoutareawarded to Asian firms. That percentage increases to 3.39% among corporations with a written diversityplan,butdecreasesto1.82%amongcorporationsthatdonothaveaplan. Written Diversity Plan with Targets: The percentage of total procurement to Asian firms increasesto3.44%,amongcorporationswithawrittendiversityplanandtargetsfordiversity atthesupplierlevel. NativeAmerican WrittenDiversityPlans:Onaverage,0.83%ofgoodsandservicescontractedoutareawarded to Native American firms. That percentage increases to 0.88% among corporations with a writtendiversityplan,butdecreasesto0.47%amongcorporationsthatdonothaveaplan. WrittenDiversityPlanwithTargets:ThepercentageoftotalprocurementtoNativeAmerican firms decreases to 0.74%, among corporations with a written diversity plan and targets for diversityatthesupplierlevel. 44

OtherMinorities WrittenDiversityPlans:Onaverage,3.31%ofgoodsandservicescontractedoutareawarded to Other minority firms. That percentage increases to 3.76% among corporations with a writtendiversityplan,butdecreasesto0.52%amongcorporationsthatdonothaveaplan. Written Diversity Plan with Targets: The percentage of total procurement to Other minority firms increases to 4.11%, among corporations with a written diversity plan and targets for diversityatthesupplierlevel. Fortune100Corporations Hispanic/Latino Written Diversity Plans: On average, 3.36% of goods and services contracted are awarded to Hispanic/Latinofirms.Thatpercentageincreasesto3.47%amongcorporationswithawritten diversityplan,anddecreasesto0.05%amongcorporationsthatdonothaveaplan. Written Diversity Plan with Targets: The percentage of total procurement to Hispanic/Latino firms decreases to 3.07%, among corporations with a written diversity plan and targets for diversityatthesupplierlevel. Black/AfricanAmerican WrittenDiversityPlans:Onaverage,3.91%ofgoodsandservicescontractedoutareawarded to Black/African American firms. That percentage increases to 4.03% among corporations withawrittendiversityplan,butdecreasesto0.01%amongcorporationswithoutaplan. Written Diversity Plan with Targets: The percentage of total procurement to Black/African American firms increases to 4.27%, among corporations with a written diversity plan with targetsfordiversityatthesupplierlevel. Asian WrittenDiversityPlans:Onaverage,4.06%ofgoodsandservicescontractedoutareawarded to Asian firms. That percentage increases to 4.19% among corporations with a written diversityplan,butdecreasesto0.14%amongcorporationswithoutaplan. Written Diversity Plan with Targets: The percentage of total procurement to Asian firms decreases to 4.10%, among corporations with a written diversity plan with targets for diversityatthesupplierlevel. NativeAmerican WrittenDiversityPlans:Onaverage,1.61%ofgoodsandservicescontractedoutareawarded to Native American firms. That percentage increases to 1.66% among corporations with a writtendiversityplan,butdecreasesto0.01%amongcorporationswithoutaplan.

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OtherMinorities WrittenDiversityPlans:Onaverage,5.40%ofgoodsandservicescontractedoutareawarded to Other minority firms. That percentage increases to 5.58% among corporations with a writtendiversityplan,butdecreasesto0.09%amongcorporationsthatdonothaveaplan. Written Diversity Plan with Targets: The percentage of total procurement to Other minority firms increases to 6.84%, among corporations with a written diversity plan with targets for diversityatthesupplierlevel. 46

WrittenDiversityPlanwithTargets:ThepercentageoftotalprocurementtoNativeAmerican firms decreases to 1.40%, among corporations with a written diversity plan that has targets fordiversityatthesupplierlevel.

CONCLUSIONS DiversityonCorporateBoards Women Directors comprise a little more than a third of their proportion in the U.S. population. Asiansalsohavehigherrepresentation,atabouthalfoftheiroverallproportionofthepopulation. Blacks/African Americans have the highest representation compared to their proportion of the population,atabout69%. Allminoritiescombinedfareworseproportionally,andonlyrepresent14.45%ofDirectors,less thanhalfofthe35%ofthepopulationtheycompriseinthiscountry.Hispanicshaveoneofthe poorestrepresentationsonBoards.Hispanicscomprise3.28%ofDirectors,aboutonefifthofthe 15% they represent in the U.S. population. Native Americans make up about .04% of Board members,approximately5%oftheiractualpopulation. TherepresentationofallgroupsincreaseswhenlookingatFortune100corporations,exceptfor Asians,NativeAmericansandOtherminorities.NoFortune100BoardhasaNativeAmericanor OtherminorityDirector. Foodproducts/servicesindustryhasthehighestrepresentationofbothminoritiesandwomenon average. Women fare best in the food products/services, insurance, science/technology and media/entertainment/marketing industries. Blacks/AfricanAmericans fare better than all minoritygroupsacrossallindustries,butdothebestinthefoodproducts/servicesandfinancial services industries. Hispanics fare best among aero/defense/transportation and food products/servicesindustry. DiversityonExecutiveTeams WomenfareslightlybetteronexecutiveteamsthanoncorporateBoardsbutstillrepresentless than onehalf of their proportion to the overall population. Minorities do much worse on executive teams than on corporate Boards, representing 10.44% of executive managers, or less thanonethirdoftheiractualproportionintheU.S.population. Blacks/African Americans saw the greatest decline from representation on Boards to executive management teams 8.77% to 4.23%. In fact, they went from about one out of 11 Board members to one out of every 24 executive team members. When compared to population statistics, Blacks/African Americans on executive teams represent only about onethird of their U.S.population. Hispanics/Latinos fare worse on executive teams vs. Boards, yet still were at about onefifth of theirproportiontotheU.S.population.AsiansandNativeAmericansdoslightlybetterat2.55% and .25% respectively. Minority groups do better among Fortune 100 corporations, except for Hispanics/Latinos. Whenexecutiveteamdiversityisanalyzedbyindustry,womenfarebestamongtheinsuranceand retail industries. Blacks/African Americans fare better than most minority groups across all 47

industries,butfarebestintheenergyandfoodproducts/servicesindustries.Hispanicsdobetter in the food products/services industry, and Asians fare better than women and all minority groupsinthetelecomm/computer/businessservicesindustry. SupplierDiversity MinorityBusinessEnterprises(MBEs)asawholetakein7.02%oftotalprocurementofgoodsand services.Asianownedfirmsdobetterthanallgroups,andBlack/AfricanAmericanownedfirms doslightlybetterthanHispanic/Latinoownedfirms.Whilelessthanhalfofrespondentssupplied dataonprocurement,itisobviousthatminorityownedfirmsarenotgettingmanycontracts.Itis alsotellingthatmanycorporationschosenottoprovidethedata.Giventhedataprovidedinthis survey,corporationscouldusesignificantimprovementintrackingsupplierdatabyracial/ethnic categorysothattheyareabletoassesstheirlevelofdiversityandtakestepstoimprove. TheValueofWrittenDiversityStrategyandImplementationPlans An overwhelming majority (82%) of corporations that responded have formal written diversity plansandaclearmajorityhastargetsfordiversityattheexecutivemanagementandprocurement level.However,havingsuchplans,evenwithtargets,doesnotcorrelatewithsignificantincreases indiversityatanylevel.Thereforecompaniesshouldnotrelysolelyonsuchplansastheirmeans forimprovingdiversity. AttheBoardlevel,onlyaboutaquarterofcorporationshavetargetsfortheBoardiftheyhavea written plan. Most groups suffer if corporations do not have a written plan with targets at the Boardlevel.Forinstance,thenumberofminoritiesdropsabout5percentagepointsfrom15.5% to 9.62%. Women suffer as well; corporations that have targets at the Board level have an average of 21.5% women Directors compared to 16.7% if they do not have targets. And the percentage of Hispanics/Latinos and Blacks/African Americans dropped by half among corporationswithouttargets. At the executive management level, if corporations do not have a written diversity plan, the percentageofwomenonexecutiveteamsdecreasesslightly,buttherearenorealgainsforwomen ifcorporationshavetargetswithinthoseplansattheexecutivelevel.Minoritiesseeslightgainsif a corporation has a written plan and if those plans have targets. The same goes for Hispanics/Latinos,Blacks/AfricanAmericansandNativeAmericans.Planswithtargetshavezero impactonAsianrepresentation. In terms of procurement, having a written diversity strategy and implementation plan benefits minorityownedfirmsthegreatestamongFortune100corporations.Theadvantageislessclear amongFortune500corporations.Inaddition,havingtargetsattheprocurementleveldoesnot meanimprovedsupplierdiversity. DiscussionofDiversityWhenEngagingExecutiveSearchFirms Thesurveyfoundthatadiscussionofdiversitywhenutilizingexecutivesearchfirmshasapositive impactonoveralldiversityattheexecutiveteamlevel,especiallyforAsians.AttheBoardlevel, 48

Asians and women see the greatest impact, although discussing diversity does not improve representation of minorities, Hispanics/Latinos and Blacks/African Americans. Therefore, we recommendthatcorporationsdonotrelyonsimplydiscussingdiversitywhenutilizingexecutive search firms, but that they seek search firms with expertise or utilize other networks to pull candidatesfromdiversecommunities.

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 MovingForward: BestPracticesandRecommendations
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BESTPRACTICES This survey provides insight not only into the level of diversity among the leadership of our nationstopcorporations,butalsoinsightintowhatstepshavebeentakentoimprovediversity. Inoneinstance,thissurveywasaneyeopeningexperiencetoaparticularCEOwhohadthought thediversityofhiscompanywasinbettershapethanitactuallywas.Thesurveyfoundthatthe corporations with the highest diversity at the top were those that invest significant time and capital into this effort. However, the survey found that no single practice alone improves diversity. InvestinginandGettingtoKnowDiverseCommunities CorporationswiththehighestlevelsofdiversityattheBoardandexecutivelevelhavealsomadeit a priority to invest in minority communities that they are marketing their products and/or servicesto.Theyrealizethatsuccessfulandprofitableadaptationtonewandgrowingsectorsof the population very much correlates with diversity at the top. These companies actively do so because they realize it is good for their bottom line. Some corporations even have entire marketingteamsdedicatedtofocusingspecificallyonindividualminoritygroups. RelationshipswithOrganizationsthatWorkwithDiverseCommunities While philanthropy does not necessarily mean higher diversity at the leadership level, those corporationsthatweremoresuccessfulwithdiversityinvestnotjustmoneybutsignificanttime withorganizationslikeNCLR,HACU,SocietyofWomenEngineers,theUnitedNegroCollegeFund, AmericanAssociationofPeoplewithDisabilities,MinoritySupplierDevelopmentCouncil,among others. These corporations also actively partnered with such organizations to help recruit a diverseworkforceandengageMinorityWomenBusinessEnterprise(MWBE)suppliers. ImplementingCorporateMentoringProgramsfromWithin Many successful diverse corporations have implemented structured and meaningful mentoring programs within their companies, where midlevel managers with promise are mentored in a meaningful way by the CEO personally and his/her direct reports. These programs require significanttimeinvestmentbythementorandarestructuredinawayinwhichtheybecomeakey partofthecorporatediversityplan. HoldingMorethanHumanResourcesAccountableforDiversity AllcorporationswiththebestdiversitystatisticsholdmorethanHumanResourcesaccountable for implementing diversity. Almost always these corporations have not only a Chief Diversity Officer,butaDiversityAdvisoryCouncilmanagedbytheCEOandhis/herdirectreports.Manyof these corporations also indicated they hold all their business leaders responsible for diversity. ThisprocessalsofoundthatcorporationswithDiversityAdvisoryCouncilsdedicatedtosupplier diversitydobusinesswithmorediversesuppliers. LinkingSuccessonDiversitytoBonuses It also follows that those corporations that link improvements in diversity among each department to the bonuses and annual performance reviews of business leaders tend to have betterdiversityamongtheirworkforceandamongthetopleadershipoftheircorporations. 51

RECOMMENDATIONS Itiswellknownthatcorporationsreaprecordprofitsinpartbytappingintothebuyingpowerof minoritycommunitiesandwomen.Today,womenrepresentmorethan50%ofourpopulation, and minorities together make up more than 35% of our population combined.v Blacks/African Americans number at more than 37 million, Asians make up more than 13 million and Hispanics/Latinos comprise more than 45 million people.vi Yet, the power of these numbers is hardlyreflectedintheleadershipofournationstopcorporations. According to the Selig Center for Economic Growth, as of 2009 the purchasing power of the Black/AfricanAmerican, Hispanic/Latino and Asian communities is estimated at $910 billion, $978billionand$508.6billion,respectively.viiMoreover,accordingtotheU.S.WomensChamber of Commerce, women control $4.3 trillion of U.S. consumer spending.viii Recent studies show a direct, positive correlation between diversity at the top and corporate financial performance.ix Given the importance of these communities to corporate profits, it is imperative that these communitiesberepresentedatthedecisionmakingtableofthesecorporations. The following are recommendations that corporations can implement today if they are serious aboutimprovingdiversityatthetop: DevelopRelationshipswithExpertOrganizationsOutsideofTraditionalNetworks. Nominatingcommitteesshouldneverusetheexcusethattheycannotfindaqualified minorityorawomantonominatetotheirBoard.Thiswasactuallyacommonresponse overthecourseofthissurvey.Therearenumerousorganizationsthatmaybeoutsideof thetraditionalnetworkbuthaveextensivecontacts,resourcesandexpertiseindifferent communitiesandknowwhotherightpeopleare.Thoseorganizationsshouldbeengaged tothefullestextent. DoNotRecruitSolelyattheIvyLeagueSchools.ExpandingrecruitmentfromIvyLeague schoolstoothertopschoolscanbeanotherwaytogetqualifieddiversecandidatesintothe corporatepipeline.Also,developingrelationshipswithprofessionalorganizationsthatcan helpidentifyqualifiedpeoplethroughtheirmemberships. Utilize Executive Search Firms with Expertise in Diverse Communities or Require ThemtoSeriouslyConsiderDiversity.Thesurveyshowedthatadiscussionofdiversity when using executive search firms did not necessarily correlate with improved diversity. Therefore,stepsshouldbetakenbeyondjustasimplediscussion.Allsearchfirmsshould be obligated to look for and provide companies with diverse, qualified candidates rather thansimplypullingfromtraditionalpoolsofcandidates.Forexample,diversecandidates who have experience running large nonprofits or government agencies should not be ruledout,especiallyiftheirissueexpertisealignswiththecompanymission.Asearchfirm should be able to provide detailed information on what they are doing proactively to recruit diverse candidates. In addition, search firms that have unique expertise with diverse communities should be recruited to help identify candidates for Board and executive management positions. Insight into diverse communities can create a lot of businessforasearchfirmthatiseffectiveinanichespace. 52

 Interview at Least One Diverse Candidate When Filling Board or Leadership Positions.SimilartotheNationalFootballLeaguesselfimposedRooneyRule,whereat least one minority candidate is interviewed for head coaching and senior football operationsopportunities, nominating committees,CEOsand Human Resourcespersonnel should aim to interview at least one minority candidate when looking to fill leadership positions. These interviews should be done in a serious and meaningful manner, not simplytocheckabox. LinkSuccesswithDiversitytoBonuses.Corporationsshouldlinkdiversityamongeach businessdepartmenttothebonusesandannualperformancereviewsofbusinessleaders. Thesurveyfoundthatcorporationsthatdothistendtohavebetterdiversityamongtheir workforceandamongthetopleadership. Hire Chief Diversity Officers from Diverse Communities. It is crucial that diversity chiefs at a company come from the communities they are recruiting from and working with.Theseindividualsaremorelikelytohavetiestothecommunitiestheyrepresentand canusethoserelationshipstorecruitdiversecandidatesforpositionsatalllevels. Hold More than Human Resources and Chief Diversity Officer Accountable for Diversity.Diversityshouldbeagoalineveryaspectofacompanysoperationsnotonlyin the areas of procurement, Board and senior management levels, but also in a companys treasury office where financial oversight lies. Diversity should be considered among brokeragefeesthatextendtoprofessionalserviceslikelegalfees,mergersandacquisitions, pensionfundmanagement,andotherservices.Manytimesthebudgetforthesetypesof services significantly exceeds that for suppliers. These areas should be part of a corporationsdiversityplan.Whilethisparticularsurveydidnotaskquestionsrelatedto brokeragefeesandprofessionalservices,thenextonewill. Create External Advisory Councils to Assist with Diversity. Forming an external advisory council to focus on diversity is a good step to developing relationships within specific communities and identifying potential candidates for positions. These Councils shouldnotbeformedonlywhenthereisacrisis.Thereshouldbeaseparatecouncilfor each diverse group, i.e. women, Asians, etc, and each should report to the CEO. These councils should be composed of outside community leaders that do work and have extensivenetworkswiththesecommunities. Be Clear on the Difference Between U.S. Employees and Foreign Employees When FillingDirectorshipsandOtherLeadershipPositions.Althoughthissurveydidnotask corporations to differentiate between U.S. and foreign employees, future surveys will. Foreign Nationals should be considered separately from the levels of diversity for U.S. employees. Groom Senior Employees for Top Positions. It is critical that corporations implement meaningful succession planning, whether in the form of a mentoring program or other similar mechanism, for senior employees of a company who can be groomed for top leadership positions in the future. Such a program should require a significant time 53

investment from the CEO and his or her leadership team. These programs help identify people who not only could be future leaders of the company, but could be tapped for DirectorpositionsonothercorporateBoards. Track Supplier Diversity So It Becomes a Priority. The lack of data shared regarding diverse suppliers, specifically in terms of a breakdown by ethnic/racial category, proves thatthisisanareathatneedswork.Accordingtothelatestcensusfigures,therearemore than7.8millionwomenownedbusinessesand5.8millionminorityownedbusinesses.xIt is important to make an effort to procure with diverse suppliers and track this progress overtime.Ifacorporationdoesnotknowwhereitstands,itcannottakeactiontoimprove. Philanthropy is Good, but Not Enough. This survey showed two things, among others: that there is much philanthropy, but less diversity. Although philanthropy is good and shouldbepartofacorporationsdiversityplan,philanthropyaloneissimplynotenough. Diversityatalllevelsshouldbemadeaprioritynotonlybecauseitistherightthingtodo, butbecauseitisagoodbusinessdecision. OpportunitiesforBoardDiversityWhenCompaniesGoPublic.Somecompanieshave beenboughtbyprivateequityfirmsthatwilltakethempublicverysoon.Intheprocess, companieswillhavetorenameanentirelynewBoardofDirectors.Thisprovidesaprime opportunity to seek the most diverse, qualified candidates for Director positions and can have the quickest impact on improving Board diversity. Corporations that fall into this categorywillbewatchedcloselyoverthecomingyear. Do Not Rely Solely on Written Diversity Plans. While corporations with written plans aremorelikelytohavebetterdiversityamongtheirleadershipaswellaswithsuppliers, the gains were only slight. Therefore, corporations should not rely soley on written diversity plans, but should also implement more farreaching changes that can have an evengreaterimpact.Implementingsomeoftheaforementionedrecommendationsshould providecorporationsagoodstepintherightdirection.

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NONRESPONSIVECORPORATIONS The following corporations did not respond or sent inadequate responses that did not provide the datarequestedinthesurvey. AbitibiBowater Black&Decker AdvanceAutoParts Blackrock AdvancedMicroDevices Blockbuster AECOMTechnology Brightpoint AffiliatedComputerServices Broadcom AGCO Brunswick AgilentTechnologies CameronInternational AirProducts&Chemicals CarMax Airgas Caterpillar Alcoa CBS AlleghenyTechnologies Celanese AlliantTechsystem Centene Amazon CenterPointEnergy AmericanElectricPower CenturyTel AmericanFamilyInsuranceGroup CH2M AmericanFinancialGroup CharlesSchwab Amerigroup Chesapeake AnixterInternational Clorox Aon CMSEnergy Apache CocaColaEnterprises Apple CommercialMetals Aramark CommunityHealthSystems(CHS) ArcherDanielsMidland ConocoPhillips ArrowElectronics Conseco AsburyAutomotiveGroup ConsolEnergy Ashland ConsolidatedEdison AtmosEnergy ConWay Autoliv CoreMarkHolding Autonation CrosstexEnergy AutoOwnersInsurance CrownHoldings Cummins Autozone CVREnergy AveryDennison D.R.Horton Avnet DanaHolding BakerHughes Danaher Barnes&Noble DeanFoods BedBath&Beyond Deere BerkshireHathaway DeltaAirlines BestBuy DevonEnergy BigLots DicksSportingGoods BJsServices DirecTV BJsWholesale 55

DISHNetwork DollarTree Domtar Dover Dr.PepperSnappleGroup DTEEnergy EastmanChemical EastmanKodak eBay ElPaso ElectronicArts EliLilly EMC EmcorGroup EmersonElectric EnbridgeEnergyPartners EnergyFutureHoldings EnergyTransferEquity Entergy EOGResources ErieInsuranceGroup EsteeLauder ExpeditorsInternationalof Washington FamilyDollarStores FidelityNationalFinancial FifthThirdBancorp FirstData FirstEnergy Fiserv Flowserve Fluor FMCTechnologies FootLocker FPLGroup FranklinResources FreeportMcMoranCopper&Gold FrontierOil Gannet GeneralCable GeneralDynamics GenuineParts GlobalPartners GMAC Goodrich GoodyearTire&Rubber

GraybarElectric GreatAtlantic&PacificTea Group1Automotive H&RBlock HarleyDavidson Harrahs Harris HenrySchein Hershey HewlettPackard Holly HomeDepot HostHotels&Resorts Humana Huntsman IcahnEnterprises IllinoisToolWorks InsightEnterprises IntegryEnergyGroup InternationalAssetsHolding JabilCircuit JacobsEngineeringGroup Jarden JohnsonControls KellyServices KeyCorp KimberlyClark KinderMorgan Kohls L3Communications LandOLakes LasVegasSands Lear Leggett&Platt LibertyMedia LibertyMutualInsuranceGroup LiveNationEntertainment LockheedMartin Loews Lowes Manitowoc Manpower MasterCard McGrawHill MDUResourcesGroup MeadWestvaco 56

MGM MohawkIndustries MolsonCoorsBrewing Mosaic Motorola MurphyOil MutualofOmahaInsurance MylanLabs NashFinch NationalOilwellVarco Nationwide NavistarInternational NCR NewellRubbermaid NewmontMining NewsCorp Nike NorfolkSouthern NorthwesternMutual Nucor NuStarEnergy NYSEEuronext OReillyAutomotive OccidentalPetroleum OfficeMax Omnicare OshkoshCorporation OwensCorning OwensIllinois Paccar Pantry ParkerHannifin PeabodyEnergy PenskeAutomotiveGroup PepcoHoldings PeterKiewitSons PetSmart PhilipMorrisInternational PilgrimsPride PlainsAllAmericanPipeline PNCFinancialServices PoloRalphLauren Praxair PrecisionCastparts Progressive ProLogis

PublixSuperMarkets PulteHomes Qualcomm R.R.Donnelley&Sons RadioShack RegionsFinancial ReinsuranceGroupofAmerica RelianceSteelandAluminum ReliantEnergy RepublicServices ReynoldsAmerica RockwellAutomation RockwellCollins RossStores RyderSystem Safeway SanminaSCI SaraLee Scana SearsHolding SempraEnergy ShawGroup SherwinWilliams SLM SmithInternational SmithfieldFoods SmurfitStoneContainer SonicAutomotive SpectrumGroupInternational SPX St.JudeMedical Staples SteelDynamics Supervalu Synnex Sysco TargaResources Target TechData Telephone&DataSystems Tenneco Terex Tesoro Textron ThermoFisherScientific Timken 57

TJX TravelCentersofAmerica TRWAutomotive TutorPerini UGI Unisys UnitedServicesAutomobile Association UnitedStatesSteel UnitedStationers UniversalAmerican UniversalHealthServices URS USAA ValeroEnergy VF VirginMedia Visteon W.R.Berkley

Walgreens WashingtonPost WellCareHealthPlans WescoInternational Western&SouthernFinancialGroup WesternDigital WesternRefining Weyerhaeuser WholeFoodsMarket Williams WinnDixieStores WisconsinFinancial XcelEnergy XTOEnergy Yahoo YRCWorldwide

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ENDNOTES
i

U.S. Census Bureau, 2008 estimates U.S. Census Bureau, 2008 estimates iii The Women-Led Economy, US Womens Chamber of Commerce, June 16, 2010 iv Buying Power 2009, Selig Center for Economic Growth, Terry College of Business, University of Georgia v U.S. Census Bureau, 2008 estimates vi U.S. Census Bureau, 2008 estimates vii Buying Power 2009, Selig Center for Economic Growth, Terry College of Business, University of Georgia viii The Women-Led Economy, US Womens Chamber of Commerce, June 16, 2010 ix Council of Institutional Investors x U.S. Census Bureau, 2007 Economic Census, July 13, 2010
ii

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