The 2014 DiversityInc Top 50 Announcement Event
April 22 • New York City • Sold Out! Click Here To View Registered Companies

DiversityInc Top 50 Methodology

The process of determining The DiversityInc Top 50 Companies for Diversity list became more sophisticated this year with our switch to SAS software. This has enabled us to measure more human-capital ratios than ever before and to refine our measurements, which we believe give us better accuracy. We’ve also utilized the power of the software to better measure what actually constitutes top performance and to eliminate outliers.

We enhanced our accountability by having notarized CEO sign-offs on submissions from companies where we have not met with the CEO directly.

The survey continues to be completely based on empirical data. Participation in the survey is free and companies that do business with DiversityInc receive no preferential treatment. There are seven companies on this list—including two in the top 10—with whom we have no business relationship at all.

The number of companies participating in the survey has increased annually, but this year saw the largest jump of all—from 587 companies in 2012 to 893 in 2013. The reason is twofold: We had a focused marketing outreach to many more companies, and interest in diversity management in corporate America is growing rapidly.

In order to participate, an organization must have at least 1,000 employees and fill out our detailed 300-question survey. Free report cards given to all companies completing the survey assess four areas: Talent Pipeline, Equitable Talent Development, CEO/Leadership Commitment and Supplier Diversity. Each company is judged within its own industry, and each application is vetted by our staff. The data is kept secure and
confidential; it is never shared with anyone outside of the company.

Although the weightings of the questions are not released, we do discuss the evolution of what correlates to measurable results—what, therefore, is emphasized. In recent years, we have placed increased importance on resource-group and cross-cultural-mentoring participation and best practices since they yield demonstrable human-capital improvements. Next year, we plan to increase the emphasis on what percentage of a company’s gross revenue goes to philanthropy, since that is a critical indicator of corporate values and ability to build community support.

Here is a brief explanation of each of the four areas we measure: 

Talent Pipeline: This area assesses the company’s ability to recruit people of all races, ethnicities, genders and ages. It includes:

  • Workforce Age (breakdown by race, ethnicity and gender)
  • Recruitment (with ratios of new hires vs. workforce demographics; new hires into top three levels of management vs. existing demographics of those levels; recruitment vs. involuntary turnover)
  • Diameter of Existing Talent (with ratios of demographics of top three levels vs. all managers; first promotions into management vs. all managers; promotions within management vs. all managers)
  • Structures (such as executive involvement in formal, cross-cultural mentoring; percentage of managers in mentoring; mentee/mentor demographics; percentage of CEO’s direct reports who are executive sponsors of resource groups; percentage of employees participating in resource groups)

Equitable Talent Development: This area assesses retain, engage and promote people from all demographics fairly. It includes:

  • Effective talent-development programs (such as resource groups used for mentoring, recruiting, marketing and diversity training; measurement of promotions, retention and engagement of resource-group members; and whether the diversity council establishes goals and metrics)
  • Movement (including ratios of first promotions into management vs. workforce demographics; promotions into and within management; percentages of managers promoted; promotions within top three levels)
  • Fairness (demonstrated by ratios of management promotions vs. voluntary turnover and recruitment vs. involuntary turnover)

CEO/Upper-Management Commitment: This area measures the visible and accountable involvement of top leadership as well as representation at senior levels and on boards of directors. It includes:

  • Quality of Accountability (such as diversity goals being part of performance reviews; executive compensation being linked to diversity metrics, including supplier diversity; whether top executives have senior-advisory positions at ethnic, LGBT and disability nonprofits; percentage of revenue spent on philanthropy; percentage of philanthropy spent on ethnic, LGBT or disability nonprofits)
  • Executive Involvement (such as diversity goals being part of performance reviews; executive compensation being linked to diversity metrics, including supplier diversity; whether top executives have senior-advisory positions at ethnic, LGBT and disability nonprofits; percentage of revenue spent on philanthropy; percentage of philanthropy spent on ethnic, LGBT or disability nonprofits)
  • Representation (includes demographics of top three levels, board of directors and executive diversity council)

Supplier Diversity: This section assesses the effectiveness of supplier development. It includes:

  • Quality of Program (such as procurement-management compensation tied to supplier-diversity results; supplier diversity included in requests for proposals [RFPs] and vendor contracts—includes Tier I [direct contractor] percentages with suppliers owned by people from underrepresented groups)
  • Developing Suppliers (such as Tier II [subcontractor] percentage with suppliers owned by people from underrepresented groups; training, mentoring and incentives for suppliers; providing financial education and assistance to suppliers)
  • Effective Strategies (such as presenting results to board of directors; auditing supplier-diversity numbers; working with corporate communications; sponsoring scholarships or education; and working with supplier-diversity organizations)

How to Apply, Free Report Card and Reporting Period

Click here to participate in the 2015 survey. The 2014 survey is now closed; however, you may use any one-year reporting period ending after June as the basis for your data submission. This means you may fill in your survey well before the end of the previous year. There is no fee to enter. Every company that fills out the survey receives a free report card assessing performance overall and in those four areas measured.

The survey is accompanied by FAQs that answer common concerns about each question, but our staff is also available to help with questions about technical issues and the meaning/intent of the questions. Please contact top50@DiversityInc.com for staff assistance. We also offer these tips on how to do well in this year’s survey.

The same application is used to determine placement on the 14 other lists, which can be viewed at www.DiversityInc.com/top50.

DiversityInc also annually recognizes companies with Special Awards that go beyond the empirical data and show substantive ways they connect diversity management to business results. This year’s winners were honored at our October event. For previous Special Award winners, click here.

For more DiversityInc Top 50 reading, see:

Top 3 Reasons to Participate in the DiversityInc Top 50

6 Case Studies: Why Companies Rise & Fall in the DiversityInc Top 50

CEI Index: Twice as Many Top 50 Companies Have 100% Ratings Vs. Fortune 500

CEO Commitment

8 CEOs Whose Inclusive Styles Change Corporate Cultures

Where’s the Diversity in Fortune 500 CEOs? 

DiversityInc CEO Interviews

Human Capital

 What HR Really Needs to Succeed

HR & Legal: Setting Goals

Diversity Web Seminar: Talent Development

Supplier Diversity 

How WBENC Helps Companies & Women-Owned Businesses

Should You Track Suppliers Owned by LGBT People or People With Disabilities?

Supplier Diversity: How Can You Make the Business Case?

Corporate & Organizational Communications  

Diversity Management Done Right: 5 Best Practices to Achieve Measurable Success

Top 5 Ways to Use Your Resource Groups

Will Your New Mentoring/Sponsorship Program Succeed?