LESSONS LEARNED FROM THE DIVERSITYINC TOP 50
EFFECTIVE DIVERSITY COUNCILS
Tying Compensation
to Council Metrics
Sixty percent of companies with executive diversity councils tie executive compensation to council goals. The trend at the companies we interviewed is to link executive compensation in three ways: for overall demographic goals, business-unit demographic goals and individual goals. The overall company-wide and business-unit demographic goals usually include recruitment, retention and promotion of people from traditionally
underrepresented groups.
KPMG, like the other professional-services firms, has grappled with this
issue because of transparency requirements under Sarbanes-Oxley.
HANNAN We don’t have incentive
comp. You tie it into their performance rating. It impacts their compensation. So that’s how we ensure
that there’s a direct linkage there.
If you’re an exceptional per-
former on other metrics, say it’s
your financial performance or what
have you, and you fail to meet your
objectives from a diversity perspec-
tive, you can’t be an exceptional
performer. That’s how we get it.
We say if you’re ethnically diverse and you come into this firm, you are assigned to a key account, a priority account, as soon as you come in the door. In reality, if you don’t put that focus and spotlight on it, the white males will get that just by virtue of numbers, so you have to be very intentional.
