Diversity: The Obama Effect

Workforce Management
February 2009

Experts believe the election of the first African-American president of the United States will redefine workplace diversity, placing a greater emphasis on multiculturalism and socioeconomic status. By Jessica Marquez

In many ways, Subha Barry believes her job will be easier now that the United States has its first African-American president. She was having lunch at a diversity conference in Hong Kong when the organizers broadcast President-elect Barack Obama’s November 4 victory speech in Chicago.
"I remember thinking that the job of any supporter of diversity is going to be much easier because we now have this visual symbol in the most powerful role in the world," says Barry, managing director of global diversity and inclusion at Merrill Lynch.
But Barry also realizes that with Obama’s presidency comes a new set of challenges—the most game-changing of which will be how his position raises the bar in defining diversity. No longer will it be sufficient for companies to simply consider race, sex and religion in silos, Barry says. Experts believe there will be more focus on multicultural as well as socioeconomic diversity within the workplace.
"In this country, we have these constructs that view race in a one-dimensional perspective. But in other countries the consideration of race is more complex, so he is viewed as multicultural," says Ana Duarte McCarthy, chief diversity officer at Citigroup. "The fact that Obama is multicultural will put more focus on what it means to be multicultural."
Obama’s father was born in Kenya, and his mother was an American from the Midwest.
At the same time, Obama has spoken about the need for more socioeconomic diversity in higher education, and experts expect that to spill into the workplace.
"There has started to be chatter online about a move toward class-based affirmative action," says Tarun Mehta, an attorney in the San Francisco office of Bryan Cave. This could mean that employers will have to take into account socioeconomic differences as part of their diversity initiatives.
But before companies can even think about working on these more sophisticated diversity initiatives, they will have to address a slew of new challenges that are expected under Obama’s administration. These include increased criticism of affirmative action policies by opponents as well as greater enforcement of affirmative action policies by the government.
All of this comes as companies face the biggest economic crisis in years. A Conference Board survey of CEOs released in October found that having a diverse workforce fell in importance by four rankings since last summer, while reducing health care costs jumped seven rankings.
"It’s probably going to be more difficult for HR to get the CEO’s attention on these kinds of issues right now," says Toni Riccardi, senior vice president of HR and chief diversity officer at the Conference Board. "It’s not that diversity is less important to employers; it’s just that other things are more important."
Election’s impact Within days of the election, HR executives already were hearing arguments from critics of affirmative action saying that Obama’s victory was a sign that there isn’t a need for diversity policies, says Lewis Benavides, vice president for HR at Texas Woman’s University and a member of the Society for Human Resource Management’s special-expertise panel on workplace diversity. A similar concern was raised by several SHRM diversity panel members at a meeting November 10 in Alexandria, Virginia, Benavides says.
"There is an acknowledgement that when the highest officer of the land is an African-American, there will be people who will say, ‘Why do we need these programs anymore?’ " he says.
It’s an issue particularly for companies with voluntary diversity programs, experts say. Companies may also see an increase in reverse-discrimination lawsuits from white males, Mehta says.
"Given the economic conditions, it might not be hard for opponents of affirmative action to find possible plaintiffs for these cases," he says.
At the same time, companies with affirmative action policies in place can expect that the Equal Employment Opportunity Commission and the Office of Federal Contract Compliance Programs will have more resources under Obama and be more aggressive about enforcing affirmative action policies.
The majority of Fortune 1,000 companies have contracts with the government, and thus have affirmative action policies, experts say.
Under the George W. Bush administration, agencies like the OFCCP saw their budgets cut, so they weren’t as effective as they could have been, says Renee Dunman, president of the Affirmative Action Association, a group of diversity and affirmative action officers from private and public organizations. In fiscal 2008, President George W. Bush requested a budget of $84.2 million for the OFCCP, down from $85.2 million in 2006 and significantly down from the $92.3 million requested in 2001. "I think Obama is going to look at that budget and say, ‘No wonder you can’t do the compliance piece,’ " she says.

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