Baloney Meter: Ad Agencies Cant Buy Diversity

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Baloney Meter: Ad Agencies Can't Buy Diversity

By Jennifer Millman

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December 20, 2007

Omnicom Group pledged $1.25 million over the next five years to create the Omnicom Diversity Development Advisory Committee (DDAC) to "advance diversity within the company and advertising industry."

It's a good start, but for the $11.4-billion company, it's just a drop in the bucket. Can a $190-billion industry that has been one of the worst of all time in terms of diversity "get it" by investing 0.01 percent of its total revenue on the subject? It's unlikely.

People of color are 18 percent of the work force and 11 percent of management at advertising agencies, according to the U.S. Equal Employment Opportunity Commission (EEOC), which is far behind the national average (31.5 percent and 16.4 percent, respectively) and their representation in The 2007 DiversityInc Top 50 Companies for Diversity^®, where people of color are 35 percent of the work force and 24.4 percent of management. (See also: Can All-White Ad Industry Change? Agencies Agree to Hire More Black Managers)

The industry, which got into hot water last year after a New York City Human Rights Commission investigation of multiple agencies, including several owned by Omnicom, revealed the dearth of black ad execs and other people of color. The organizations were criticized particularly for the lack of recruiting strategies such as internships, award programs, job fairs and on-campus recruiting, and a New York City councilman called their hiring practices an "embarrassment for a diverse city."

Upon threat of subpoena to a public hearing on the matter, all agencies signed agreements with the Human Rights Commission requiring them to implement diversity strategy, expand recruiting and professional-development networks and increase representation. They agreed to submit annual reports on their progress, but without accountability, the culture doesn't change.

At the time, the public wasn't optimistic the agencies would follow through on their new commitments; 93 percent of Ad Age poll participants said the pacts signed by the more than a dozen agencies would not impact diversity in the industry.

Competitive companies want to do business with agencies that can reach their audience through relevant messaging. As their audiences have become more segmented across multiple dimensions, today's ad agencies haven't kept up. Lack of representation in advertising agencies often leads to costly multicultural missteps for the companies that contract with them, and ad agencies increasingly find themselves having to adapt to the changing consumer market, such as Omnicom, or facing a shortening list of clientele.

So what's the deal with Omnicom?

"It's an important moment in the future of the advertising industry, and diversity and inclusion are critical to our success," says Tom Watson, former Omnicom vice chairman, dean of Omnicom University, the company's in-house global leadership-development organization, and a member of the committee. "This is an opportunity for us to look forward to making some strides for diversity at Omnicom and maybe the advertising industry, but I'm just concerned about Omnicom at the moment."

Real change requires senior-level investment and performance incentives tied to diversity, but the new Omnicom committee has yet to spell out the details.

"We have yet to set specific goals within that mission. Our first meeting is in January and we expect that to be a key factor on the agenda," says Watson. "We have to set them and everybody's got to have some input on that, so that's where the diversity committee will come in handy. We're eager to collaborate to develop strategies to complement our current diversity initiatives and advance diversity within the company."

"This isn't something that we'll accomplish by next Tuesday, but the idea is to make a start and make a commitment," adds Watson.

Can the All-White Ad Industry Change?

Omnicom's committee is tasked with helping the advertising industry identify and attract talent of color for its agencies, to craft professional-development opportunities and evaluate the success of ongoing diversity initiatives within the company.

Developing outreach programs to increase the profile of the industry within communities of color and working with higher education to expand the talent pool also are objectives of DDAC. As a supplement to this effort, Omnicom is giving $1 million to Medgar Evers College to support efforts to implement a curriculum in advertising and communications.

H. Carl McCall, a director of several public companies, including Tyco International and Ariel Mutual Fund, has been tapped to chair the eight-member committee. Adweek reports that it includes: