New York City Is Open For Business

Advertising firms have been unable to attract minorities into their upper echelons and the City’s Human Rights Commission is here to help:

Finding that just 2 percent of the upper echelon of the advertising industry is black, New York City officials said yesterday that they had reached agreements with several of the nation’s biggest ad firms forcing them to bring more black managers into this crucial sector of the city’s economy.

The city’s Human Rights Commission found that hiring of black workers had barely improved since an inquiry found similar problems 40 years ago. Of 8,000 employees working for 16 agencies the commission examined, Patricia L. Gatling, chairwoman of the commission, said about 22 percent make more than $100,000 a year, and only 2.5 percent of those are black.

Faced with the findings, nearly a dozen agencies, including those owned by the Interpublic Group of Companies and the WPP Group, have promised to set numerical goals for increasing black representation on their creative and managerial staffs and to report on their progress each year.

Under the agreements, the agencies have agreed to submit to three years of monitoring by the city, under which the companies will report hiring, promotion and retention figures to the commission each year. If they do not meet their goals, they will hire an outside consultant to help them do so, among other measures.

At the same time the companies have agreed to set up diversity boards and to link progress on the issue to their managers’ compensation.

The commission has the authority to fine companies up to $250,000 or to sue them, but officials said that they believed the threat of pressure from agency clients like Pepsi and Citigroup was a more effective stick in bringing corporate leaders to the negotiating table.

. . .

By signing the agreements, which also require that agencies establish recruiting and internship programs through universities with large minority student populations, the agency executives can avoid the embarrassing prospect of testifying at public hearings scheduled for Sept. 25, at the start of the industry’s annual gathering, Advertising Week. So far, of the 16 agencies subpoenaed to testify by the commission, only the agencies of the Omnicom Group have declined to work on an agreement, officials said.

The commission’s analysis, which looked at salary levels as well as job titles, indicated that although the major ad firms have black workers, they are largely absent from the most senior or creative levels. Of 476 employees at DDB’s New York office, commission officials said, 51 are black. But of 159 employees making $100,000 or more, only 2 are black. Neither is among the 29 employees earning $200,000 to $300,000 or the 22 employees earning more than $300,000.

A similar pattern exists across the industry, commission officials said.

(Would Governor Corzine threaten the industry with fines?)