Sunday, June 22, 2008

Agency Holding Companies and Diversity

It's perfectly clear that the marketplace, our customers and various regulatory agencies are demanding diversity.

- Michael Roth, Chairman and CEO of Interpublic

In Teresa Howard, "Ad Agency Interpublic Group Acts as Mentor to Build Diversity," USA Today, June 16 2008

Over the past thirty years, forces outside and inside the media have pushed the advertising industry to increase the number of women, blacks, Asians and Hispanics within their ranks. Critics point out that it is ethically untenable and bad from a business standpoint that an "industry that speaks every day to multicultural audiences with $2 trillion in spending power" has a bad record of recruiting blacks, Asians and Hispanics at creative and executive levels. That is the case even in New York City, the center of advertising, which is one of the most diverse US cities. Various companies have tried to solve the problem, but without longterm success for themselves or the industry. The New York City Commission on Human Rights considered the situation so bad that in 2006 it investigated 16 New York based agencies. They settled, making a three year commitment to hiring more black and Hispanic ad practitioners. Interpublic, which owns three of the situation agencies, created its InterAct Associates program to move the diversity needle. It "recruits college graduates for IPG's network of 60 agencies and trains them over two years with six-month stints in specific areas of advertising." The overall numbers are small for IPG, which has about 40,000 employees. Nevetheless, company executive insist it is an important planting of seeds that will grow to affect the entire company positively.

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