Task Force Report Reveals Coke’s Progress on Diversity

In 2000, Coca-Cola agreed to a $192 million settlement in arace-discrimination suit. As part of the settlement agreement, the companypledged to conduct a top-to-bottom review of its HR systems in an effort topromote a diverse environment and ensure fairness and equal employmentopportunity. An external task force was appointed for four years to review thecompany’s progress.

Last September, the task force issued its firstreport, which revealed thatalthough Coke has made significant progress in many areas related to equalopportunity, challenges still remain.

On the plus side, Coke is in the process of:

• Conducting routine monitoring of various HR systems, including performancemanagement, staffing, compensation, and  problem resolution, to ensure fairnessand consistency.

  
  

• Implementing a uniform performance-management system for all U.S.-basedemployees to ensure fair, documented performance evaluation based on specificjob-related measurements. The system is designed to increase senior managementaccountability by tying their performance reviews and compensation to theireffectiveness in performance management.

  
  

• Implementing changes to its compensation system, including moving to a commonreview data for merit increases, instituting routine pay-equity analyses, andreinforcing the connection between performance management and merit increases.

  
  

• Instituting executive briefings and strategic-thinking sessions among seniormanagement regarding the company’s diversity strategy.

  
  

• Implementing a program to provide employees with several avenues forresolving problems, including an employee hotline and ombudsperson program.

  
  

• Piloting a large-scale, one-on-one mentoring program.

  
  

Despite progress in these areas, the task force revealed that significantchallenges still face the company. For example:

• A distinct gap exists between white employees’ perception of the company’sdiversity practices and that of racial and ethnic minorities. For instance,black employees were less positive than white employees about advancement andcareer-development opportunities.

  
  

• The company missed an important opportunity to show its commitment todiversity when it nominated two white males to its board of directors in thespring of 2002. Members of the task force believed that the company’s failure toconsult with them about the nominations undermined diversity efforts andsuggested a lack of sensitivity to declared diversity goals.

  
  

The report also revealed that:

• Of 6,864 non-hourly U.S. Coke employees, 30 percent are minorities, up 4percent since December 31, 2000. Two-thirds of those minority employees areAfrican-American.

  
  

• Between January 1 and June 30 of last year, women and minorities werepromoted at a higher rate (5.0% and 5.7%, respectively) than white men (4.7%).

  
  

• Promotional rates at the executive level were far greater for women andminorities. However, minorities make up only 20 percent of the workforce at theexecutive level and are over-represented among the lowest-paid “supportpersonnel,” at 47 percent.