UMass Labor Center Finds Deep Flaws With Corporate Diversity Rankings

 Researchers Say Forbes’ Influential “America’s Best Employers For Diversity” Is A “Rogue’s Gallery Of Companies With Active Discrimination Lawsuits Against Them And Well-Publicized Allegations Of Discriminatory Behavior”

Source: UMass News and Media

As jobseekers increasingly add a company’s diversity efforts to the list of attributes influencing their decision on choosing their next workplace, a new working paper published by the University of Massachusetts Amherst Labor Center raises a number of red flags with one of the most popular corporate diversity lists.

In their paper, Tom Juravich, professor of labor studies and sociology at UMass Amherst, and Erik Plowden, research assistant at the Labor Center, detail major flaws with Forbes’ list of “America’s Best Employers for Diversity.”

The first issue they raise is how the individuals are selected for participation in the survey that forms the backbone of the list.

“The goal in all survey research is that the people filling out a survey look just like the overall group being studied. This ensures reliable and valid findings,” Juravich and Plowder write. “However, companies chose the individuals to participate for this survey, raising serious red flags. A responsible employer would take this opportunity to select a representative sample of employees to participate in this study to assess how they are doing on diversity issues.”

The researchers say the design of Forbes’ survey does not prevent diversity-washing, the creation of the appearance of embodying diversity and employing inclusive practices while making only superficial changes.

“Nothing stops a firm from surveying only office positions and not manufacturing jobs, choosing from the most diverse division or where diversity training has been implemented,” they write. “Given that inclusion on these lists is so coveted, what stops a company from cherry-picking who is selected to participate? That employers choose who participates in the study raises serious concerns about its validity.”

The second major flaw they describe is that the survey primarily questions employee attitudes, rather than measuring the employer’s actual diversity or efforts to increase its diversity. “These are the actual measures of corporate dedication to diversity, and they are not part of this rating system,” Juravich and Plowden write. “It also does not focus on employer behaviors in the workplace.”

Forbes indicates that they disqualify employers from the listing if there have been “ongoing allegations or unresolved lawsuits” around diversity and inclusion, but when the researchers investigated the top 50 firms on the Forbes list they found that 17 had experienced significant events that should have disqualified them.

“Throughout the Forbes 2021 Best Employers for Diversity list is a rogue’s gallery of companies with active discrimination lawsuits against them and well-publicized allegations of discriminatory behavior,” they write.

Juravich and Plowden note that several entries on the list either currently are, or recently have been, subjects of litigation about their workplaces:

• Fidelity Management – ranked fifth on the list in 2020 – faced lawsuits for a discriminatory and hostile workplace where women were disparaged and racially insensitive comments were made
   
• Media giant Gannett is currently the defendant in two active lawsuits for both ageism and pregnancy discrimination
   
• Tesla has just been handed a $137 million judgement for racial discrimination, with multiple sexual harassment suits still pending against the company
   
• Santander received an “F” grade from a 2021 Committee for Better Banks study on diversity in financial institutions in part for failing to even disclose its workforce demographics
   
• JP Morgan Chase paid out $9.8 million to the Department of Labor in 2020 to settle allegations of gender pay disparities

“That such recent and serious allegations of discrimination have been leveled against companies ranked among Forbes’ Best Employers for Diversity calls into question the actual level of scrutiny used to vet firms selected for the list, especially given the ease with which these violations were found,” the researchers write.

The complete report, “Diversity-Washing: The Problem with Corporate Diversity Ratings,” is published as part of the UMass Amherst Labor Center Working Paper Series, and is available online now.