Corporate America’s Black Eye

The latest rash of corporate misconduct has triggered new battles over the corrosive effects of bias in the American workplace

with back pay. Now the law allows a litigant to sue for money damages as well as attorney fees, a factor which gives attorneys additional incentive to take on such cases.

“The court has continually been relied upon for the ultimate resolution of disputes about the obligation of private entities like corporations to not treat people in a discriminatory way,” says Alvin Thornton, chairman of the political science department at Howard University in Washington D.C. “As long as women and blacks are disproportionately excluded, there will always be litigation of this nature.
But what are the long-lasting effects of these recent cases? Is it just a matter of paying off a few while the corporate behavior as a whole remains the same, or will their impact reverberate into changing corporate culture as it relates to race?

Different companies have handled their “predicaments” differently. Since the Denny’s case was settled, Flagstar has gone into a public relations blitz announcing a series of new initiatives aimed at increasing its number of minority franchisees. In January, the corporation announced it would contribute $100,000 to eight civil rights organizations and $625,000 to the United Negro College Fund.
At Texaco, Bijur announced the company would modify the way it handles recruitment, hiring, retention and career development of minorities as well as increasing its contractual efforts with more minority companies.

Mitsubishi agreed to institute new economic programs and policies over the next five years, at a cost of about $200
million, to improve minority opportunities, including pay raises and new car dealerships, as part of an agreement with the Rev. Jesse Jackson to call off a nationwide boycott of the organization.

“We want corporations to stop the formula of targeting us for consumption and then boycotting us–a humiliating imbalance of trade and limited jobs and economic development opportunities,” Jackson says. He sees measures taken by Texaco, Mitsubishi and others as an important first step. But Jackson believes the most important leverage is how and with whom the African American community spends its money. “We must become more highly disciplined in the use of our dollars as a leverage to bring about economic change.”

It’s not a new refrain. But Jackson added something new and potentially dynamic to the mix when he recently announced the formation of the Rainbow/PUSH Wall Street Project. According to Jackson, the office will monitor the top 100 corporations where blacks consume in the greatest numbers to determine if the company in question reciprocates back into the black community.

Jackson says the companies will be judged by creating a measuring system to rate them based on the diversity and effectiveness of their board of advisors, employment patterns, investment portfolios, money managers and their contract practices, among other indicators. For added incentive, Jackson has inferred he might publish details on how well 100 of the largest corporations treat minorities. “There are product lines where African Americans [consume] 50%-75% of the products. In these instances, we are the majority,” says Jackson. “So many corporations depend upon our appetites, upon our membership, upon our

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