Copyright (c) 2000 University of Michigan Law School

Michigan Journal of Race & Law

 

Fall, 2000

 

6 Mich. J. Race & L. 127

 

 

ARTICLE: THE NEW CULTURAL DIVERSITY AND TITLE VII

 

Steven A. Ramirez*

 

 

* Associate Professor of Law, Washburn University School of Law. Professor Ramirez is Of Counsel to the Kansas City law firm of Polsineli Shalton & Welte. This Article benefitted greatly from presentations to the Midwestern People of Color Legal Scholarship Conference, 2000, and the Northeastern People of Color Legal Scholarship, 2000. Leonard Baynes, Neil Williams, Richard Delgado, and Michael Olivas each provided valuable insights that served to improve this Article. Robert Coulthard provided excellent research assistance. Dean James Concannon, as always, provided institutional support for my efforts in writing on the topic of diversity. My sister, Deborah Ramirez, was instrumental in helping me develop the race-neutral approach to diversity embodied in this Article, first by questioning it, then by critiquing it, and ultimately by embracing it. 

 

SUMMARY:

  ...  Thus, this Article is not about affirmative action or racial justice or even race-based decision making. ...  This argument collapses, and is devoid of any logical content, once one accepts that race is a social construct. ...  The more sound analysis therefore is for the Court (and society generally) to recognize that the kind of diversity management programs discussed in this Article is a means for the business community to address major race-related challenges in a race-neutral fashion that allows business to dissipate the effects of traditionally excluding certain groups. ... Even if diversity management policies are not protected by the EEOC's safe-harbor, it is still unlikely that decisions that are based upon unleashing diversity benefits would be found to violate Title VII, even though such decisions are, in some sense, "race-conscious" or "gender-conscious." ... Despite this primary focus, however, this Article also seeks to provide a theoretical framework, founded upon developments in the business community, for rationalizing the legal system's treatment of "race" through embracing the opportunities inherent in cultural diversity. ...  

 

TEXT:

 [*127]  

INTRODUCTION

 

 Diversity has long been thought of as a potential justification for racial classifications. n1 This Article proceeds upon the premise that individuals contribute to productive cultural diversity within a properly managed diverse workforce in a facially neutral and merit-driven manner. n2 Thus, this Article is not about affirmative action or racial justice  [*128]  or even race-based decision making. n3 Instead, this paper analyzes a culture-conscious decision making that is taking root in the business world as a means of increasing workforce productivity. n4 Specifically, this paper assesses the diversity initiatives of the leading edge of corporate America under Title VII of the Civil Rights Act of 1964. n5

The leading elements of the American business community, faced with a more culturally diverse business environment, are moving quickly to embrace diversity. n6 American business is rationalizing its response to  [*129]  this environment by seeking to exploit the powerful insights offered by workers who were traditionally excluded by the dominant White male business class that has controlled America throughout the nation's history. n7 The driving force behind this movement is competition and the imperative to be more productive. n8 As such, diversity initiatives are not about racial preferences but instead individual merit. n9 This Article will explain this nascent business movement and assess how it should be treated under Title VII.

This Article will show that the most progressive diversity initiatives taking hold in the business community are facially neutral in their approach, merit-driven, and fundamentally culture-conscious (as opposed to race-conscious). n10 These initiatives do not allow for any racial  [*130]  preference or gender preference and draw any such bias not from the inherent values of diversity but from the largely segregated pre-existing corporate tradition: hiring culturally aware minorities unleashes value because they bring insights previously unavailable to segregated businesses. n11 In other words, White males can be and are hired in the name of cultural diversity when they bring cultural insights to the business. n12 Nevertheless, these initiatives also serve to pave the way for traditionally excluded groups (including African Americans, Hispanics,  [*131]  and women) to participate in American economic life in a more meaningful fashion, and in far greater numbers than in the past. n13

Part I of this Article will summarize the business case for pursuing a culturally diverse workforce, define how the leading edge of the business community is going about its pursuit of diversity, and provide an overview of the empirical evidence showing the productivity gains achieved by the best diversity practitioners. Part II of this Article will respond to the critiques leveled against diversity thus far and will show that these criticisms do not apply to the diversity initiatives now being pursued by the leading edge of corporate America and that therefore there is no policy basis for rejecting these initiatives. Part III suggests that courts should uphold these diversity initiatives under Title VII because they have empirical support showing that they entail culture-conscious employment decisions (not color-conscious decisions), are merit-driven, and are facially neutral. Moreover, because these diversity initiatives are the best compliance means available to business, rejecting these initiatives would be unnecessarily reactionary and disruptive of the business community's settled expectations regarding Title VII liability. n14 The Article concludes with a summary of a theoretical framework that could provide a degree of resolution of some aspects of race and gender issues on a more generalized basis.

I. An Overview of the New Cultural Diversity in Business

 

 The American business community increasingly recognizes that embracing diversity n15 is a source of strategic strength that can enhance  [*132]  competitiveness. n16 A culturally diverse workforce unleashes critical thinking, innovation, and creativity. Diverse perspectives provide an employer with valuable insights, much like a graduate degree or other intellectual qualification, that can serve as a basis for achieving important institutional missions, such as market penetration or increased innovation. These insights are becoming more valuable as the nation's business environment becomes more diverse.

A. The Demographic Context of American Business

 

 The nation's business environment is in the midst of dramatic demographic and economic changes that will challenge our business community's ability to deal with diversity. First, the nation's population (and hence its labor, investor, and consumer pools) is undergoing an historic change: the nation's minority populations are increasing rapidly, while the labor pool as a whole is stagnating. n17 White males, therefore, constitute a decreasing percentage of key constituencies. n18 Second, the  [*133]  business of America is increasingly integrated into the world economic system, meaning that American business must now deal with important constituencies (labor, investor, and consumer pools) that are as multi-cultural as the world. n19 The leading elements of the American business community are seizing the opportunities implicit in these changes.

The leading elements of corporate America are rapidly moving to embrace diversity in response to these trends. n20 These programs include hiring a greater number of traditionally excluded persons. But these initiatives also typically entail diversity training, affinity groups, mentoring programs, and assistance with career development. The touchstone of all these programs is to create an environment that allows all of the talents of a diverse workforce to achieve maximum potential. These programs most often target women, African Americans, and Latinos, although many companies also target Native Americans, Asian Americans, and disabled Americans. Many organizations with diversity programs have staff dedicated to such initiatives. The most progressive companies now recognize that embracing diversity goes beyond (but no doubt includes) bringing increased numbers of women and minorities into an organization; it also requires fostering an environment of  [*134]  sensitivity and tolerance for differences. Under such circumstances diversity can be a powerful way to increase organizational effectiveness. n21

On a very pragmatic level, globalization and demographic developments create an imperative for corporate America to embrace diversity. Business can use diversity initiatives to eliminate racial hostility and to ensure that all workers enjoy an environment that is conducive to maximizing employee potential. n22 This will give companies embracing diversity a competitive advantage in the escalating "war for talent." Such an environment will attract all members of the contracting labor pool. n23 Diversity initiatives will provide corporate America with the insights needed to achieve maximum market penetration in more diverse domestic and inherently diverse global markets. n24 Diversity sparks productivity gains by fostering innovation and creative thinking about ways to do business in a more diverse business environment. n25 Increasingly, this is the most progressive and sophisticated thinking in leading edge firms and influential business organizations. In short, those firms that excel at managing diversity will outperform diversity laggards. n26

B. The Case for Embracing Diversity

 

 Leading professional business associations have studied diversity management in great detail. The Conference Board n27 has sponsored a  [*135]  series of reports exploring the utility of diversity in achieving greater business performance. The Board has specifically refused to endorse the pursuit of diversity for its own sake; instead, the Board endorses profit-driven diversity management. n28 The Conference Board concluded, as early as 1995, that business should recognize that diversity can be used to enhance the bottom line, or can have negative consequences for companies that choose to ignore diversity issues. n29 Moreover, "leading edge companies" are executing diversity strategies based upon business imperatives notwithstanding the lack of certain evidence showing benefits. n30 The conclusions of the Conference Board, however, do have support in a study undertaken by the American Management Association. n31 The study included a survey of over 1,000 managers and executives and evaluated the impact of diversity upon corporate performance objectives such as productivity and net operating profits. The study concluded that diversity in senior management consistently correlates to superior corporate performance. n32

Psychological research on the diversity of small working groups directly supports the value of cultural diversity. n33 Heterogeneous working groups offer more creative solutions to problems than homogenous working groups. n34 They also show greater inclination for critical thinking and are likely to avoid problems associated with "group think," where members mindlessly conform to group precepts. n35 Ethnicity provides the  [*136]  necessary heterogeneous cultural perspective sufficient to trigger "kaleidoscope thinking" by providing a variety of perspectives and to combat "group-think." n36 This is consistent with data showing that people of different ethnic backgrounds hold distinct "world views" and that Latino, Asian, African, and Native Americans have not been so assimilated that these unique views have been lost. n37 This is the difference that drives the value of diversity. n38 In sum, the findings based upon feedback directly from managers are consistent with a wide variety of studies examining the impact of diversity upon group action. n39 What these managers are saying is thus backed by scientific evidence: managers who can manage diversity well will be more productive than those who are unable to cope with increasing diversity. n40

Another area where the value of diversity is unleashed is the ability to achieve greater market penetration. n41 Obviously, if there are different "world views" among traditionally excluded cultures, then there are real insights that can be provided by a culturally diverse workforce. Indeed, researchers theorize that cultural background plays a major role in Consumer  [*137]  behavior. n42 Thus, leading business academicians argue that the insights and sensitivities brought by people from varying ethnic backgrounds help companies reach a wider variety of markets. n43 They note, for example, that "people with similar frames of mind, similar values and principles have a strong basis for communication and communication is the art of sales." n44 Economists have similarly found that "individuals with similar characteristics communicate at lower cost." n45 Therefore, "efficiency and competition dictate matching employees and customers." n46 In other words, it is the invisible hand driven by the need for efficient communication between customer and employee that often drives hiring decisions. It is not, however, just a matter of communication. "What minority consumers respond to most eagerly is a level of respect that too often is missing in their transactions with mainstream businesses." n47 It is noteworthy, though, that the business case for diversity does not rest on morphological features and racial affinity, but rather cultural insights and understanding. n48

C. The Empirical Proof to Date

 

 Empirical research testing the business case for diversity management has thus far provided strong support for all of its major premises. First, in a detailed study of the effects of diversity management upon the stock price valuation of a firm, empirical data suggest that announcements that a firm has obtained diversity awards are associated with  [*138]  competitive advantage (as reflected by increased stock prices) and that announcements that a firm has been sanctioned for discrimination are associated with inability to achieve such advantage. n49 Second, sound diversity management programs are associated with higher productivity and higher profitability. n50 Third, diversity management programs reduce stigmatization (compared to affirmative action programs), thereby contributing to the success of traditionally excluded groups of employees and providing a further competitive advantage. n51 Fourth, firms with diversity management policies are more creative and flexible and better problem solvers. n52 Finally, organizations perceived to be pursuing diversity management were more attractive employers to potential recruits (of all backgrounds) than those not having that perception; this implies yet another competitive cost advantage. n53

All of this evidence showing the value of diversity in terms of increased productivity is also consistent with the actual market performance of those companies that aggressively embrace diversity. "A study of the Standard and Poor's 500 by Covenant Investment Management found that businesses committed to promoting minority and women workers had an average annualized return on investment of 18.3 percent over a five-year period, compared with only 7.9 percent for those with the most shatter-proof glass ceilings." n54 Similarly, Fortune magazine and the Council on Economic Priorities have attempted to assess a company's overall diversity efforts. n55 The 50 companies chosen as the "Diversity  [*139]  Elite" for 1999 as "a group have performed terrifically, about matching the S&P 500 over the past year, and beating it over the past three and five years." n56 The 1998 list also outperformed the S&P 500. n57

Simply stated, the most innovative and sophisticated elements of the business community have concluded that embracing diversity can, when properly managed, create powerful benefits. n58 The evidence thus far strongly suggests that companies adept at managing diversity can do so in a manner that achieves greater profitability. n59

D. The Penalties for Ignoring Diversity

 

 Some of the most persuasive evidence in favor of embracing diversity is the devastating losses suffered by those companies that have allowed sexism or racially hostile environments to fester within their business. The most notorious example of such a casualty is Texaco Oil Company and the unfortunate Texaco shareholders during the time that the racism within Texaco came to light. n60 Texaco's nightmare began in 1994, when African American employees filed a class action lawsuit alleging pervasive racial discrimination. n61 The extent of Texaco's discriminatory misconduct was revealed in late 1996, when a senior executive released highly controversial tapes that appeared to have contained racial slurs emblematic of a racially hostile environment. n62 Once allegations of Texaco's misconduct surfaced, its shareholders suffered stunning losses, as its market capitalization plunged by one billion  [*140]  dollars. n63 Subsequent reports demonstrated that the tapes were not isolated circumstances of racial bigotry, which instead appears to have permeated Texaco's business culture. n64 Ultimately Texaco paid $ 176 million, then the largest amount ever paid in a racial discrimination suit, to settle the class action claims of over 1,400 African American employees. n65 Texaco also suffered from a serious bout of negative publicity that caused investors to flee the company n66 and consumers to threaten boycotts. n67 As our population gets more diverse, and globalization proceeds apace, our nation is certain to see more "Texacos," and the amount of damage to be absorbed by such firms for failing to remedy misconduct is sure to increase exponentially, as investors learn to avoid closed corporate cultures and consumers and labor markets react to patent racism.

E. Conclusion: The Need to Manage Diversity

 

 Certainly, diversity, although a powerful tool, is not a magical sure-fire road to enhanced profitability. Managing diversity is as important as bringing diversity to a business. Many corporations, most notably Texaco, have suffered dire consequences from an inability to manage diversity. These instances, however, do not detract from the central thesis of this Article that businesses are using diversity as a competitive advantage in order to maximize profits, and that the legal system should accommodate, encourage, and respond positively to this new paradigm of viewing diversity as a strength. These instances highlight the need for policies that assure that business organizations truly embrace diversity rather than pursue policies of tokenism or tacit exclusion. The point is that cultural diversity must be properly managed. n68

 [*141]  The EEOC has studied the "best practices" of the business community in the area of diversity management and has released a task force report that defines and summarizes the "best practices" that the leading firms have adopted. n69 Combined with the empirical evidence in support of diversity management and the work of other diversity management scholars, a fairly clear picture has developed illuminating proper diversity management practices. In sum, diversity theory posits that initiatives permeate all aspects of a business, that senior management support and foster diversity, that diversity be implemented in a manner that is inclusive of all groups (including White males), that racial and gender intolerance be eliminated, and that companies seek productive uses for the benefits of diversity. n70 In other words, cultural differences should be tolerated, appreciated, and valued so that the full potential of each employee can be realized. These diversity practices are also what distinguishes naked racial preferences from the business imperative of managing a diverse workforce in an increasingly diverse business environment.

II. The Critique of Diversity

 

 Valuing diversity means: the ability to exploit the synergy that occurs from diversifying working groups; to use a diverse work force to provide insights for greater market penetration; to achieve advantageous international relationships; to tap expanded labor pools; to avoid the costly pitfalls of increased diversity; and, therefore, to generate increased profits. Tapping these benefits can hardly be termed "reverse discrimination" or "racial nepotism." n71 Instead, it simply recognizes that people  [*142]  bring merit - the ability to generate value - through many different talents and insights, including fundamentally different cultural experiences.

A. An Affirmative Action Retread?

 

 Embracing cultural diversity is not affirmative action, at least under most accepted definitions of that ill-defined term, because it entails no racial preference. n72 This is because embracing cultural diversity is simply  [*143]  valuing a dimension of merit - nothing more, nothing less. n73 However, not all commentators are convinced. n74 Some have called proponents of increased corporate diversity "Diversity Hucksters." n75 Others seem to believe that valuing diversity necessarily diminishes the value of merit. n76 Still others assume that diversity is simply a pseudonym for affirmative action. n77 These arguments miss the point of this Article. This Article does not address whether affirmative action should be taken to remedy the longstanding racial discrimination and oppression that has traditionally been practiced in our society. n78 Nor does the thesis of this Article in any  [*144]  way de-emphasize the importance of merit. n79 Instead this Article merely posits that business should address diversity issues rationally and that the legal system should not act as a reactionary force against valuing diversity. This Article specifically argues that appropriate diversity policies should maximize profit opportunities and minimize risks relating to the increased diversity of the business environment. n80 Ultimately, this paper proceeds upon the premise that well-managed diversity adds value to a business enterprise. Perhaps some skeptics cannot be convinced that embracing diversity has value, regardless of the evidence showing that it enhances corporate performance. n81 Nevertheless, even though it is quite difficult to measure the effect of diversity upon a business' bottom line, recent history is replete with examples of diversity-related issues either enhancing a company's profits or causing real financial setbacks to a business. n82

Some arguments against using America's diversity as a strategic strength are retreads from the affirmative action arena. One such argument is that race cannot serve as a proxy for anything but race - and to hold otherwise indulges stereotypical thinking. n83 Under this view, it is inappropriate to consider race in employment decisions in any way whatsoever. This argument collapses, and is devoid of any logical content, once one accepts that race is a social construct. n84 Professor Ian F.  [*145]  Haney Lopez has deconstructed and reconstructed race in a thorough and careful fashion. n85 Professor Haney Lopez concludes that because "race" has no genetic content, the only meaning that can be ascribed to "race" is that of "a vast group of people loosely bound together by historically contingent, socially significant elements of their morphology and/or ancestry." n86 In other words, "social meanings" linked to group "characteristics" is the essence of "race." n87 These meanings accrue to specific morphological features and ancestry as a result of a dynamic and ongoing process of "racial fabrication." n88 Simply stated, race is best conceived as a shared cultural experience involving a complex set of social conventions triggered by morphology and perceived ancestry. Thus, race is not a proxy for different cultural experiences, it is different cultural experiences, shaped by the operation of highly complex social conventions. n89 That is, unique cultural experiences are inherent to "race." It is the different cultural experiences of traditionally excluded individuals, forming a didactic paradigm compared to the dominant White male experience, that is the key to unlocking the value of diversity. n90 This is the dimension of "race" that employers are seeking to exploit. In any event, the empirical evidence shows that "race" is linked (at least by correlation) to cultural diversity, that cultural diversity exists, that it influences consumer behavior, n91 and that it is the basis for contributing diversity to group dynamics, making working groups more productive. n92  [*146]  So, whatever "race" is, cultural diversity, if properly managed, can enhance business profitability. n93

Fundamentally, these diversity initiatives reflect the efforts of the business community to rationalize its approach to a more diverse business environment. n94 The decisions undertaken pursuant to these initiatives are based upon a complex of factors in which race or gender is really a side issue. Employers are truly seeking cultural diversity, in the sense that a workforce include diverse cultural skills and facilities; and besides being a "race," African Americans or Latinos, for example, also represent a cultural identity or experience. n95 In many cases, employers can even be expected to hire Whites who possess cultural insights or cultural identity that can be a basis for valuable cultural insights. n96 In the end employers are not seeking the attributes of "race," so much as specific mental abilities, such as particular cultural communication skills.

Put simply, racial identity and specific cultural skills are not co-extensive. For example, an employer may wish to hire individuals with insights into how to market equipment needed to transform a vehicle into a "low-rider." Market data may indicate that 80% of their target market consists of young male Mexican-Americans. Nevertheless, a White male brought up in the west side of Chicago may offer superior insights into how to market a product to fans of "low rider" automobiles when compared to a Mexican American raised in Chicago's north suburbs. Cultural diversity does not depend upon indulging racial stereotypes or assuming that any individual has any particular cultural  [*147]  background. It is simply about exploiting differences and matching people's skills and facilities with jobs. n97 Economists studying diversity have found it to be driven by a rational business response to market pressures; thus, it would be senseless for business to hire on the basis of mere stereotypes.

"Race" and culture are highly intertwined in modern America, as a matter of correlation, but it is not the morphological elements of "race" in which employers are interested; it is instead purely the cultural insights, perspectives, and experiences that drive the value of a diversified workforce and form the meritorious individual contributions that employers value. n98 Diversity does not logically support any notions of racial essentialism. Business would not rationally proceed on such a basis because, as has been shown, no particular views can be associated with given morphological features. n99 Different perspectives do not in any way imply uniform perspectives.

Because diversity initiatives value cultural insights as distinct from the "group characteristics" elements of race, it can fairly be termed not only facially neutral, but culture-conscious decision making as opposed to race-conscious decision making. To the extent that these decisions correlate to race it reflects a conclusion based upon experience as to which individuals are likely to offer an employer the greatest diversity benefits based upon the individual's background and the workforce context with which that the employer is currently faced. As companies accumulate more experience with diversity management, these decisions will be backed by a growing rationalization of each employer's experience with diversity-based decisions. Businesses certainly will seek those individuals who offer the greatest diversity contributions based upon a multitude of factors relating to cultural facility - including geographic background, family history, socioeconomic background, and exposure to multi-cultural experiences. n100 But, because race in America has always included morphological features (on a direct or ancestral basis) and the value of these diversity initiatives rests exclusively upon cultural  [*148]  phenomena, these initiatives entail fair cultural discrimination, not race discrimination. n101

B. Notions of White Superiority

 

 Similarly, many still argue that "diversity" is no more than an excuse for pursuing policies that favor minorities at the expense of "qualifications." n102 This, they claim, necessarily entails a sacrifice of "merit," and imposes unnecessary costs to business. n103 Typically, these arguments rely on narrow, n104 even discredited n105 definitions of merit, such  [*149]  as intelligence tests or SAT tests. n106 Recent studies tend to show, however, that firms embracing diversity outperform those that do not positively manage diversity. n107 This suggests that traditional definitions of merit are fundamentally flawed and not that embracing diversity implies an inherent sacrifice in quality. n108

 [*150]  Ultimately, addressing the argument that diversity implies a sacrifice of merit leads directly to a confrontation with the concept of inferiority, or a genetic or cultural basis. n109 Although the world community long ago formally abandoned concepts of "racial inferiority," n110 the idea is alive and well in America. n111 For example, Richard Herrnstein and Charles Murray sparked an intense debate in America when their book, The Bell Curve, argued that Latinos and African Americans were intellectually inferior to Whites. Their book has been castigated as "hoodoo social science" and as "racism in a tuxedo." n112 I will not explore here, exhaustively, the large body of scholarly criticism, from a host of academic fields, the book has generated. n113 Nor do I wish to assess the evidence cited within the work of Herrnstein and Murray that severely undermines many of their primary conclusions. n114 Instead, I only wish to  [*151]  highlight that the authors' suggestion that the extent of economic disparity between African Americans, Latinos, and Whites is largely due to IQ differentials is exactly backwards. Rather, alleged IQ differentials stem from pervasive social oppression. n115 So, a simple answer to enhancing intelligence, and thus one element of the multidimensional concept of performance, is to eliminate oppressive environments. n116  [*152]  Diversity management is all about managing work environments in a manner that enhances the performance of all employees by, among other things, eliminating racial hostility and sexism. n117 Indeed, empirical studies suggest that when diversity is properly managed, performance can be enhanced. n118 Moreover, arguing that diversity management can lead to productivity gains for employers is hardly tantamount to arguing that it is the only measure of merit. This Article merely posits that the evidence as it now stands shows that diverse workforces add value to employers, and that individuals offering greater diversity offer one indicia of merit. n119

An additional fatal flaw in The Bell Curve analysis is that it "uses racial terminology incautiously, implying a biological basis." n120 Race is a  [*153]  social construct and has no biological basis. n121 Psychometrics is a rather primitive and anachronistic manner of looking for biological variation in light of modern genetic research. The Human Genome Diversity Project has for ten years investigated biological variation, not through giving multiple choice exams, but by looking at human genetic material. So far, "the more we learn about humankind's genetic differences ... the more we see that they have ... nothing to do with what we call race," and, consequently, geneticists reject any link between "race" and intelligence. n122 The evidence from the world of genetics is becoming increasingly compelling that "racial" differences are literally skin deep. n123 Consequently, diversity initiatives in no way compromise any performance standard, and they serve only to create an environment where the potential of all employees may be tapped.

Indeed, the traditional and narrow definitions of merit must be wrong. n124 According to such measures of merit the United States would be simply too hobbled by intellectually inferior minorities to compete internationally. The argument is this: these minority populations, comprising over 35% of the American population, score significantly lower on standardized tests, and that is the primary reason for the egregious differential between minority and White populations in terms of income, wealth, and power. n125 If these measures of merit held sway, a country with such a huge segment of inferior people would be greatly disadvantaged in the world arena. n126 Instead, America is one of the most technologically advanced and productive countries on the face of the earth. n127 Moreover, the nation is in the midst of an innovation boom at  [*154]  the same time that its population is becoming greatly more diverse. n128 So either the performance of America is illusory or the whole premise of racial inferiority is illusory; they cannot logically co-exist. In fact, those claiming that diversity necessarily entails a sacrifice of merit are at odds with the fundamental concept of modern America. n129 Consequently, embracing diversity further, to the logical ends of its inherent value, will only enhance our nation's competitiveness.

Compelling evidence shows that the essential need for diversity comes not from some genetically determined dimension of merit, but from deeply entrenched policies of exclusion. n130 For example, the status of women in corporate America demonstrates the exclusionary policies traditionally practiced by corporate America. Women do not suffer from any putative genetic or cultural inferiority relative to men, yet they are essentially as absent from the ranks of leadership in corporate America as non-Whites. n131 The time is now to eliminate artificial barriers. These barriers will increasingly hobble American competitiveness. n132 As a nation, America needs to tap the talents of its entire diverse workforce. n133 Diversity policies can operate to break down these traditional barriers without sacrificing merit.

C. Diversity as "Color-blind" Merit

 

 A further critique of diversity management is that it is in conflict with the Supreme Court's "color blind jurisprudence." n134 Is the profit-  [*155]  oriented, value-driven diversity management movement headed for a collision with the Court's drive to erect roadblocks to any kind of race-conscious decision making? It is unclear how far the Court will go in leaving our society landlocked in addressing racial disparities and leaving significant portions of our people economically adrift. Taken to an extreme, the Court might hold that many private sector affirmative action programs violate Title VII. n135 On the other hand, the Supreme Court has recognized an explicit distinction between discrimination on the basis of race and action that addresses race-related matters in a neutral fashion. n136 Stated simply, correlation between some legitimate independent value and race, even very high correlation, is not tantamount to discrimination. n137

 [*156]  The more sound analysis therefore is for the Court (and society generally) to recognize that the kind of diversity management programs discussed in this Article is a means for the business community to address major race-related challenges in a race-neutral fashion that allows business to dissipate the effects of traditionally excluding certain groups. This follows from two facts. First, considering the diversity contribution of an individual means that White males, as well as women or African Americans, could be hired to further diversity. n138 Second, to the extent that now, at the dawn of the 21st Century, diversity management initiatives, in practice, operate to benefit mainly traditionally excluded groups, this is not because of race or gender preferences, but rather because of the dearth of such perspectives within most levels of corporate America, arising from past exclusionary practices on a society-wide basis. n139 Simply stated, because every individual's ability to add productive diversity is a facially race-and gender-neutral consideration, making employment decisions designed to maximize profits from a more diverse workforce is as much a "color blind" criterion as any other traditional measure of merit. n140

Diversity initiatives do not run afoul of the Court's color blind jurisprudence for another reason: they are culture-driven not color-driven. "For a majority of the current Supreme Court race is skin color." n141 The Supreme Court has never held discrimination on the basis of culture to  [*157]  be illegal in any context. n142 Yet, the value the business community is pursuing here is cultural insights, n143 cultural communication skills, n144 and diverse ways of thinking. n145 All diversity initiatives, as defined by the best practices of diversity management, ultimately seek to unleash these benefits. n146 Diversity theory holds no place for unleashing value based upon morphological features such as skin color. n147 At the theoretical level, then, diversity initiatives are color blind in that they constitute culture-conscious decisions, not race-conscious decisions.

It does appear that employers are conscious of skin color when making diversity-driven employment decisions; but there is no requirement that employers be deprived of the use of their eyes when making employment decisions (although perhaps there should be under a pure color blind regime) or otherwise be blindfolded to skin color when making employment decisions. n148 However, if the real value driving employment decisions is not morphology, then the most that can be said is that race or gender or other status as a member of a traditionally excluded group is used as a marker for cultural insights. It is not a "predominant factor" in employment decisions, if it is a factor at all. n149 Morphology is not an illegitimate proxy for cultural diversity because of the link between cultural experience and race, and because it can reasonably be expected that business will rationalize its pursuit of cultural diversity by hiring those individuals offering superior diversity benefits given the experience of the business in hiring such persons, based upon interviews, essays, reference checks, and other standard investigatory tools. n150

Diversity management therefore poses a stark choice. Here is an element of individual value - the ability to inject diversity into a business - that is proven (as a preliminary matter, at least) to positively affect  [*158]  profits. n151 For now, women, people of color, and the disabled all offer greater diversity contributions than the typical White male can offer, but only because of shortages of these perspectives due to traditionally exclusionary practices. Compare, however, this source of value to standardized tests. White males, especially those from elite New England backgrounds, like those who created the tests, have long offered greater test scores (in general) to employers than the typical person of color (or woman) can offer. n152 But those scores mean little n153 - except perhaps as an indicator of socioeconomic status and social alienation. n154 Thus, when a business makes a "race"-conscious decision to unlock the value of diversity, it is a more "merit"-driven act than any business decision based, directly or indirectly, upon standardized tests. n155 Simply stated, we as a  [*159]  society should recognize that anything that positively affects productivity, and, in turn, profitability, for a corporation must be merit driven, given that the primary objective of the business corporation is profit maximization. n156 In the world of business such decisions are unobjectionable, so long as not constituting or indulging invidious discrimination. n157

Corporate America is showing, in a rather dramatic fashion, that businesses need more diversity to compete successfully, and implicit in this realization is that business has for too long been hidebound by exclusionary definitions of merit and the predominance of a single cultural view: that of the upper middle-class White male. To open up the definition of merit, and to plug the concept more directly into productivity and competitiveness, can hardly be termed "reverse discrimination." n158 Similarly, recognition that the current business environment is sorely in need of more diversity in no way devalues the perspective of White males; it only shows that we still suffer from the hangover of yesteryear's essentially apartheid society and vestigial attitudes of White supremacy. Business is demanding more diversity because it pays and to ignore this fact or insist that seeking out non-Whites and females is always wrong indulges a sexist or racist assumption that diversity necessarily means lack of merit.

D. Conclusion: Diversity as a Rationalized Element of Merit

 

 In the final analysis, commentators arguing against the value of diversity ignore the source of these calls for diversity: the business community itself, its CEOs, its consultants, and its best managers. n159 These captains of industry are intensely focused on profits, and they tend to be White males. n160 They are saying that diversity pays, and that it has great value. n161 Clearly if embracing diversity was costly to business, business would not be embracing diversity. n162 This further suggests that  [*160]  pursuing the opportunities posed by diversity does not involve a trade-off with merit.

Moreover, it would be arrogant and reactionary for the courts to overrule these business practices as unlawful. If the business judgment rule means anything it means that business leaders are in the best position to determine the value of embracing diversity in light of the increased globalization of our economy and the increasing diversity within our population. n163 Diversity is emerging, then, as a rationalized measure of merit, not as any kind of racial preference.

Federal law does not prohibit discrimination based upon merit. n164 Nor does it mandate that merit be measured by some static criterion of yesteryear. If an African American employee can offer an employer insights on selling products to the African American community, the employer achieves value from such an employee. This value means that the employee offers merit, by supplying unique (and thus far rare, at least in the business community) insights gained from being an African American in our society. There is no basis for exalting some other measures of merit over merit flowing from diversity. From the front lines of the business world, stories of employers deriving profits from the merit offered by a diverse workforce are becoming legion. n165 The value of increasing workforce diversity can be thought of in the following terms: increasing workforce diversity will continue to pay dividends for business to the extent that business suffers from a disproportionate surplus of the insights and experiences of upper-middle class White males, plus to the degree to which diversity is expected to increase within the business environment in the future. Unlocking this value is wholly appropriate.

This also means that diversity management contains the seeds of its own destruction, at least to the extent it is viewed as a means of paving the way for the advancement of women and other traditionally excluded groups. Once business reaps the benefits of diversity in full, then it  [*161]  would rationally seek to maintain that level of diversity. n166 When is that point reached? This is an impossible question to answer, and in the final analysis turns, as diversity management in general, upon valid, good faith, business judgement. n167 In general, the courts should defer to the informed business judgment of business people with respect to this issue. But, fundamentally, how can diversity management be termed discriminatory if it allows both White and non-White employees to advance based upon the same objective standard - their contribution to workforce productivity based upon valuable cultural insights and perspectives?

In the end, it appears that these diversity initiatives have a powerful policy basis. This movement within the business community can drive increased economic growth, can serve to usher great numbers of traditionally excluded groups into our nation's economic power structure in a fair, non-preferential manner, and can therefore serve as beacon in an otherwise grim forecast for dealing positively with our nation's continued racist hangover. It is certainly true that our legal system, including the legal academy, has thus far failed to assess these fully integrated, facially neutral, and merit-driven measures in any degree of depth. Nevertheless, there is no valid policy-based attack upon this new form of cultural diversity. The law should therefore strive to accommodate and facilitate this movement.

III. Title VII and Diversity

 

 A balanced analysis of the Title VII treatment of diversity initiatives should begin with a candid acknowledgment: those invoking diversity in the name of racial preferences have not fared well. n168 Notwithstanding this record, no court has ruled on the cultural diversity initiatives discussed herein: facially neutral, merit-driven, and culture-conscious  [*162]  initiatives. n169 In other words, courts should not allow just the invocation of the word "diversity" to drive their analysis (one way or the other) of these particular diversity initiatives, which are defined in accordance with the best practices of the business community and are the focus of this Article. n170

This part of this Article will examine the interplay between diversity initiatives, as practiced by the most successful managers of diversity within corporate America, and the legal system. I posit that diversity management policies are, and should remain, fully accommodated by the law generally, and employment discrimination law in particular. Diversity management policies should be viewed not as "racial preferences" but rather for what they are: integrated efforts to accommodate all available talents within the workforce to achieve maximum productivity in a new era of business diversity. n171 Under this view persons are hired or promoted based in part upon their individual ability to add productive cultural diversity to a workforce, which is a merit-driven decision. n172 Diversity management draws any racial or gender bias not from its essential values, which are race neutral, but from the pre-existing segregation of corporate America. n173 Fundamentally, diversity initiatives are not about morphology, they are about culture. n174 As such, diversity policies should enjoy the full support of the legal system. To hold otherwise would create an unnecessary conflict between the best business practices of the most progressive elements of the business community and the law. n175

 [*163]  The EEOC has already recognized the diversity initiatives discussed herein and deemed them to be lawful, fair and, the "best practices" of industry. n176 Diversity initiatives have developed in a manner that reflect a reasonable accommodation between business, the legal environment, and the primary fair employment regulator, the EEOC. n177 The pressures giving rise to this accommodation are the profit opportunities being discovered in the business world from a properly managed diverse workforce, including true merit-based equal opportunity, as well as the business world's legal and regulatory obligations not to discriminate unfairly. n178 Given that diversity management has evolved in response to these values, it could be termed only reactionary for the legal system to reject the efforts of the business world (backed by the primary regulator in this area) to embrace diversity and to reject the merits offered by a diverse workforce.

Diversity initiatives require consideration under three areas of employment discrimination law: hostile environment liability; disparate treatment liability, and disparate impact liability. This Article will consider diversity initiatives under each theory of employment discrimination. This Part concludes that diversity initiatives are the best means for reconciling the legitimate objectives of business and its equal employment obligations. Thus, on balance diversity initiatives are the best means available for business to comply with its legal obligations while maximizing profits. This conclusion supports the position of this Article that the legal system should facilitate the efforts of the business world to embrace diversity; to do otherwise would needlessly upset the settled expectations of the business world.

A. Hostile Environment

 

 Diversity policies are crucial to securing the maximum degree of protection from liability for employment discrimination under Title VII of the Civil Rights Act of 1964. n179 For example, in the context of claims  [*164]  alleging employer liability for "hostile work environment" amounting to discrimination based upon race or gender, the United States Supreme Court has placed an employer's policies at the center of hostile environment lawsuits. n180 In Burlington Industries v. Ellerth n181 and Faragher v. City of Boca Raton n182 the Supreme Court articulated standards by which employers may escape liability for Title VII hostile environment claims that focus on an employer's anti-harassment policies, including its efforts to prevent harassment and its actions in taking prompt corrective action when such conduct is uncovered. Specifically, the court held that defendants in "hostile work environment" cases may avail themselves of an affirmative defense based upon employment policies if the employer can show by a preponderance of the evidence that: (1) that the employer exercised reasonable care to prevent and correct promptly any harassing behavior; and (2) that the plaintiff employee unreasonably failed to take advantage of any preventive or corrective opportunities provided by the employer or to otherwise avoid harm. n183 An employer may be held liable for a "hostile work environment" even in the absence of a tangible job detriment, unless it can prove this defense. n184 In Faragher, the Court clarified the operation of the new affirmative defense. The Court held as a matter of law that the City of Boca Raton could not establish the defense because it had failed to disseminate the policy to all of its employees, and its policy failed to include a provision allowing the complaining person to bypass the harassing supervisor. n185 The Supreme Court has thus made clear that employers have an affirmative obligation to take steps to eliminate hostile work environments, pervaded by bigoted employees, or face strict liability when plaintiffs establish such an environment.

 [*165]  These holdings have been extended to the race discrimination context. n186 The Americans with Disabilities Act n187 also plays a role in diversity policies, and lower courts have applied the centrality of appropriate employment policies under Ellerth and Faragher to claims brought under the Americans with Disabilities Act. n188

The essential problem here is one of bigoted and racist supervisory employees. Such employees can manifest racial hatred or sexist views on the job without specific authority from or even knowledge of the employer. Using racial slurs or insults with racial overtones or giving voice to racist stereotypes have all contributed to a finding of a "hostile work environment" and exposure to liability. n189 The same type of bigoted conduct will give rise to liability in the sexual harassment context. n190 The United States Supreme Court has reversed prior law and now holds an employer liable for the racists, bigots, and sexists among its workforce, subject only to the affirmative defense of appropriate employment policies. n191 As such, the implementation of aggressive diversity management policies is essentially mandated for those employers who wish to avail themselves of this new affirmative defense. Employers must consequently exercise due care to prevent harassment through appropriate employment policies. This is the only means of obtaining insulation from liability for the harassment of their bigoted supervisory employees.

In addition, an employer will be held strictly liable for a "hostile work environment" if the plaintiff suffers a "tangible employment  [*166]  action" as a result. n192 Here, again, diversity initiatives can serve to limit the liability of employers. Although policies alone aimed at stemming bigoted conduct will not protect employers, fostering an environment where diversity is valued and avoiding employees with bigoted attitudes should greatly limit exposure for this second basis of vicarious liability for sexism and racism. n193 These two principles of liability militate in favor of aggressive anti-harassment policies, even to the extent that firms should investigate applicants and refuse to hire those with patently racist or sexist inclinations. n194 Thus, diversity policies, including the fundamental premise of such policies that cultural differences be valued by employees, are an ideal means of eliminating hostile environments. n195

B. Disparate Treatment

 

 Title VII prohibits employers from discriminating on the basis of race, color, sex, or national origin. n196 Diversity management practices at the best corporations also prohibit such discrimination. n197 Thus, properly enforced, such policies should protect companies from discrimination claims. However, White male employees may object to the value that a given employer assigns to the diversity contributions of an applicant of color, a woman, or a member of another traditionally excluded group. n198  [*167]  The Civil Rights Act of 1991 included a provision that "an unlawful employment practice is established when the complaining party demonstrates that race, color, religion, sex or national origin was a motivating factor for any employment practice, even though other factors also motivated the practice." n199 This means that disparate treatment by employers, based upon race, gender, or ethnicity is impermissible.

As previously demonstrated, employment decisions taken in part upon diversity considerations are not based upon race, gender, or ethnicity, but are instead based upon an employee's expected contribution to increasing productive diversity. n200 If embracing diversity were based upon race or gender, there would be no basis for diversity initiatives to benefit White males. But, the diversity being embraced by leading businesses posits that diversity management excludes no class of workers, favors no class of workers, and protects all classes of workers from hostile environments. n201 As previously discussed, therefore, seeking greater workforce diversity is a facially neutral value. n202 Moreover, seeking greater diversity in the name of enhanced profitability from the valuable  [*168]  insights offered by a diverse workforce (in accordance with the business outlined in Part I of this Article) is not acting with a discriminatory motive. The pursuit of increased profitability through the benefits of a well-managed diverse workforce is not a discriminatory motive. Diversity initiatives are not based upon mere generalities but instead have detailed definition and structure, supported by powerful empirical evidence showing them to enhance productivity. n203 These factors should operate to defeat a disparate treatment claim because diversity management seeks greater workforce productivity, not race-based or gender-based decision making. n204 Thus far, however, the courts have not tested integrated and  [*169]  comprehensive diversity management policies against Title VII standards for disparate treatment. n205

Diversity management initiatives posit that workforce diversity can enhance productivity, and thus far our society generally fails to apprehend the strengths arising from our diversity; consequently there are few analogous circumstances available for testing diversity initiatives. n206 The point is this: seeking greater diversity in support of greater profitability is a facially neutral employment practice, and there are sound doctrinal as well as policy reasons for so holding. n207

This approach appears to enjoy support from the legislative history of Title VII. In the crucial Senate floor debates considering Title VII, an interpretative memorandum specifically approved of essentially the diversity rationale for hiring. n208 This memorandum, drafted by the Senate floor managers of the Civil Rights Act, states: "A director of a play or movie who wished to cast an actor in the role of [an African American], could specify that he wished to hire someone with the physical appearance of [an African American]-but such a person might actually be a [non-African American]." n209 The memorandum specified that this would not violate the Act. n210 Certainly, "the appearance of [an African American]" is a characteristic that will eliminate virtually all Whites from a given job. But, in context (specifically, a movie company making "an extravaganza on Africa" n211), such a hiring criterion is a legitimate, merit-driven qualification. n212 Thus, it is not a race-based qualification. n213 The  [*170]  race-neutral hiring criterion under the diversity theory is the increased productivity of a diverse workforce resulting from the diverse cultural experiences and insights of traditionally excluded groups. In the context of operating a business to maximize profitability, this hiring criterion is similarly a legitimate, merit-driven, qualification. The legislative history is replete, however, with affirmations that hiring on race grounds, and solely for the sake of race, is prohibited, even if it leads to enhanced profitability. n214 "Any other criterion or qualification for employment is not affected," however, by Title VII. n215 Thus, the Senators recognized that even if race discrimination was "essential" to the success of a business, it was illegal under Title VII, if not accompanied by some non-racial merit-driven benefit to the employer. n216

Certainly, as some Justices of the Supreme Court have highlighted, other portions of the legislative history of the Civil Rights Act of 1964 can be read as supporting a purely color blind approach, whereby decisions must be made without even looking at skin color as if employers can view prospects through some monochrome curtain. n217 Senator Humphrey, the Senate Floor manager of the debate, stated, for example, that "if race is not a factor, we do not have to worry about discrimination because of race ... ." n218 This is tautological, however. Of course there can be no discrimination if race is not a factor. The more relevant inquiry is whether race can play any role in employment decisions. The answer, as a matter of current law and legislative history, is that it can play some role. n219 What is critical, according to Senator Humphrey's view of discrimination, is that there be no distinction in treatment given to different individuals because of their race, religion, or national origin. n220  [*171]  Again, under the cultural diversity initiatives being pursued in the business world, culture, not race, is the overriding factor and source of value in employment decisions. n221 Race may serve as a marker (among many) for culture on a transitional basis but only because it now rationally serves as a preliminary indicator of valuable, diverse cultural insights. n222 As business becomes more adept at assessing diversity benefits and measuring diversity applications, race will recede and culture will become more rationally assessed independently of race. n223 To the extent the decisive factor is culture, not race, as the empirical data suggests, the distinction in treatment given to different individuals is not based upon race. n224

Cultural discrimination has never been held to be actionable under Title VII. Indeed, culture certainly is not immutable - and discrimination based upon immutable physical characteristics is generally required to state a claim under Title VII. n225 Culture is invariably a function of exposure and experiences and evolves over time. n226 The insights the business world seeks are not monopolized by any single race.

Title VII cases have declined to protect any kind of cultural identity. For example, the courts have rejected any cultural interest in speaking Spanish as a basis for Title VII discrimination. n227 Similarly, the  [*172]  Supreme Court has defined national origin discrimination for purposes of Title VII in a distinctly non-cultural fashion: discrimination based upon national origin means discrimination based upon "the country where a person was born, or more broadly, the country from which his or her ancestors came." n228 This formulation leaves little room for any cultural dimension of national origin and is consistent with the lack of a prohibition upon cultural discrimination under Title VII. n229 It is also consistent with the basis for the Court's color blind jurisprudence. As Justice O'Connor has explained: race discrimination stems from the "belief, held by too many for too much of our history that individuals should be judged by the color of their skin." n230 There are no relevant differences based upon skin color; thus distinctions based upon race are generally not rational, and therefore they are generally not legitimate. n231 Cultural differences, however, may rationally support important distinctions, as this paper has shown in great detail. n232 In sum, there is little basis for holding that non-preferential, merit-driven cultural discrimination is forbidden by Title VII. n233

It is no doubt true that, for now, the primary beneficiaries of diversity initiatives are minorities and women. n234 This only means that, for now, the facially neutral value of diversity is highly correlated to race and  [*173]  gender. n235 But, so what? No measure of merit has ever been diminished because of its correlation with race or gender; it would be a quite dull world if merit were quashed simply because of some magical correlation threshold with race or gender. n236 Just recently, the Supreme Court specifically rejected simple correlation between race and some facially neutral value as a basis for finding unconstitutional discrimination. n237 There, the state drew the lines of a Congressional district with the purported intent of creating a "strong Democratic district;" the fact that there was a "strong correlation between racial composition and party preference" in the district did not mean that the state acted in a discriminatory manner. n238 Diversity initiatives designed to unlock the value of a well-managed diverse workforce should be treated in accordance with these principles. Discrimination on the basis of a need for a diverse workforce is not discrimination on the basis of race.

Even in the absence of a facially discriminatory employment practice, disparate treatment may be inferred upon a showing of: n239 i) an adverse employment decision; ii) the person's qualifications did not justify the adverse decision; and iii) that the position remained open or that a person hired, retained or promoted was a member of a favored class. n240  [*174]  If a plaintiff can carry this burden, then the defendant has the burden to produce evidence showing a "legitimate nondiscriminatory reason" for the adverse decision. n241 The plaintiff then may prevail only by showing this reason to be a pretext. n242

Nevertheless, in applying these factors for determining if an inference of disparate treatment is justified, courts do not sit as a "super-personnel department," and courts must respect an employer's "unfettered discretion" to choose among qualified candidates. n243 In terms of addressing employment decisions made pursuant to detailed and carefully integrated diversity policies, courts should treat an individual's contribution to value-producing workforce diversity as it would any other indicia of business merit that adds to profitability, and defer to the business judgment of business leaders. n244 This means that courts should consider a well-founded claim of pursuing the profit-generating opportunities implicit in diversity as a legitimate non-discriminatory reason. In sum, because business emphasizes merit in embracing diversity and not race or gender, and because embracing diversity inherently includes managing workforce diversity in a way that maximizes the productivity of all segments of a workforce, including White males, it does not constitute disparate treatment.

Given its merit-driven nature, and given that even White males can, in appropriate circumstances, and increasingly in the future, add valuable workforce diversity, diversity initiatives should be treated more generously than preferential affirmative action. The Supreme Court has already held that even preferential treatment is not per se prohibited by Title VII. In United Steelworkers v. Weber, n245 the Court upheld "affirmative action" efforts that were "designed to break down old patterns of racial segregation and hierarchy [and] ... [did] not unnecessarily trammel the  [*175]  interests of white employees." n246 With respect to the first point, the Court acknowledged that the employer in Weber had a long history of discriminatory practice. n247 With respect to the second point, the Court emphasized that the plan did not require the discharge of any White employees, did not prevent the training or promotion of White employees, and that the measure was intended to end as soon as the racial imbalance ended. n248 This result is fully consonant with the statutory text of Title VII that specifically addresses the question of racial preferences and impliedly authorizes voluntary efforts to erase the effects of prior discrimination. n249 Section 703(J) states the "nothing contained in this title shall be interpreted to require" preferences based upon race or sex. n250 These same principles apply with the same force in the context of affirmative action to remedy the effects of past sex discrimination. n251

The EEOC has also issued affirmative action guidelines that provide that preferences are permissible if three conditions are met: "reasonable self-analysis; reasonable basis for concluding that action is appropriate; and reasonable action." n252 According to the EEOC, compliance with these affirmative action guidelines is a complete defense to any action based upon Title VII. n253 It is unclear how much deference the Court is likely to give these guidelines. n254 However, it appears that these regulations would provide a Title VII safe-harbor for nearly all diversity initiatives, if the EEOC's view should prevail.

It is critically important to comply with the EEOC's requirements. First, a company should authorize a "reasonable self-analysis" that should focus on the reasons why "previously excluded groups have been artificially limited," why the company is burdened with a non-diverse workforce, and whether there is some basis for believing that prior discrimination occurred. n255 Based upon such findings, the company may then take "reasonable action" to remedy the identified deficiencies. Reasonable actions include enacting race-conscious remedies that do not necessarily  [*176]  entail racial preferences, such as establishing hiring "goals" and outreach programs, revamping selections procedures, and utilizing other means of addressing perceived equal opportunity problems. n256

The diversity initiatives discussed in Part I of this Article seek to use diversity as a means of increasing profit and thereby are merit-driven. These initiatives therefore do not constitute racial preferences. Because the theory of diversity taking hold in the business world is not exclusive to Whites, they do not "unnecessarily trammel the interests of white employees." n257 Consequently, diversity management techniques should be treated substantially more generously than "affirmative action" policies, with explicit, exclusive, and merit-compromising racial preferences.

Even if diversity management policies are not protected by the EEOC's safe-harbor, it is still unlikely that decisions that are based upon unleashing diversity benefits would be found to violate Title VII, even though such decisions are, in some sense, "race-conscious" or "gender-conscious." Fundamentally, decisions undertaken in order to achieve the benefits of diversity are not decisions based upon racial disparate treatment. Diversity management policies emphasize that value is derived from having all perspectives represented within a business organization. Consequently, companies seeking to further their efforts to achieve diversity benefits are making decisions based upon qualifications. Such a decision has "legitimate, nondiscriminatory" reasons; it is not a pretext.

C. Disparate Impact

 

 When an employer's facially neutral practice disproportionately harms a racial or gender group of workers, the workers may sue for disparate impact discrimination under Title VII. n258 A disparate impact claim is typically proven through the presentation of evidence showing a statistical disparity between those selected by the employment practice in question and the composition of the relevant qualified candidate pool. n259  [*177]  An employer whose practice is found to have such an impact may avoid liability by proving that the challenged discriminatory practice is required by "business necessity." n260 (Long the subject of case-law development, the business necessity defense secured a statutory foundation in the 1991 Civil Rights Act. n261) Although the new provision aspired to provide statutory guidelines for the business necessity defense, n262 it ultimately left open precisely the questions that prior case law had failed to resolve. n263

Companies that seek to embrace diversity can expect two different consequences. First, the best diversity practices should serve to greatly protect employers from many disparate impact claims since such policies normally serve as a basis for hiring greater numbers of women and people of color. n264 Second, Whites males will, at least until current imbalances are diminished, generally offer more limited diversity benefits. n265 Thus, in order to achieve maximum protection from the claims of such employees, the employer will have to establish that any disparate impact is a consequence of business necessity. n266 Unfortunately, the definition of "business necessity" is unclear. n267 Nevertheless, any reasonable definition must accommodate legitimate diversity management practices. Fundamentally, such practices represent the best, informed judgment of the business community on how best to achieve their business goals, and they are backed by strong empirical evidence as to both the methods to be employed and the results that can be achieved through proper diversity management. n268 This should satisfy even stringent tests of business necessity, which emphasize a valid prediction of job performance and a compelling business purpose. n269 Obviously profitability gains are a "compelling business purpose" and diversity management can enhance  [*178]  profit performance. n270 There is no basis for courts to intrude upon these merit-based judgments. n271

In sum, the federal employment discrimination laws provide a compelling basis for the world of business to implement and enforce strong diversity policies. There are admittedly some risks that some parts of these diversity initiatives may lead to legal exposure. Nevertheless, the protections from liability seem to heavily outweigh the risks. n272 In other words, in addition to all of the policy justifications diversity initiatives enjoy, and in addition to the strong legal basis for upholding these initiatives, there is a final reason for upholding the business community's efforts to embrace diversity: they represent the best means available to businesses to fulfill their economic objectives and to comply with the legal mandates of Title VII.

CONCLUSION

 

 The thesis of this Article is that the new cultural diversity initiatives taking hold in the most progressive elements of the business community are consistent with any reasonable analysis under Title VII, and it would reactionary for the courts to strike down these initiatives in the same way they have dealt with diversity justifications for racial preferences. These initiatives do not involve racial or gender preferences or classifications. They are merit-driven, as shown by powerful empirical data. They seek to exploit cultural differences and not morphological differences based upon gender or national origin. While employers may be "conscious" of skin color or gender when making these decisions, such considerations are not a factor in these initiatives and are certainly not a "predominant" factor. Cultural insights are the predominant factor business is seeking.

There is no policy justification for depriving the business community of the ability to exploit this factor. On the contrary, these initiatives allow greater equality of opportunity and enhance the competitiveness of our economy on a long-term basis. Most of the critique of this movement is somewhat off-point; the arguments against diversity have been made most forcefully in the affirmative action arena. Nevertheless, this Article can articulate no good reason why these cultural diversity initiatives should be rejected under Title VII. The use of race as a marker for valuable cultural insights on a transitory basis is hardly a good reason for aborting this movement prematurely, especially since the business community can be expected to further rationalize this  [*179]  movement in a fashion that de-emphasizes the irrelevant consideration of skin color, national origin, and gender.

Despite this primary focus, however, this Article also seeks to provide a theoretical framework, founded upon developments in the business community, for rationalizing the legal system's treatment of "race" through embracing the opportunities inherent in cultural diversity. In other words this framework may well transcend the business context and apply to other areas where cultural diversity may be important, ranging from education to public employment. Thus, legal scholars interested in achieving greater equality of opportunity should think about ways to harness our nation's cultural diversity in other contexts.

 

 

FOOTNOTES:

n1. See e.g., Regents of the Univ. of California v. Bakke, 438 U.S. 265, 314-15 (1978) (Powell, J.) (stating that educational institution's interest in a diverse student body may justify racial classifications).

n2. See generally Steven A. Ramirez, Diversity and the Boardroom, 6 Stan. J. L. Bus. & Fin. 85 (2000) (providing in-depth analysis of cultural diversity initiatives within "leading elements" of corporate America and positing that such initiatives are facially neutral, merit-driven, and culture-conscious initiatives).

n3. The differences between affirmative action and diversity management are quite significant. First, affirmative action is essentially remedial in nature, while diversity, as practiced in the mainstream business community, is essentially merit-driven, in that an individual's contributions to a well-managed diverse workforce leads to profitable insights. See Arnold H. Loewy, Taking Bakke Seriously: Distinguishing Diversity From Affirmative Action in Law School Admissions, 77 N.C. L. Rev. 1479, 1480 (1999) ("Where diversity is desirable, it is because it makes the institution better."). Second, affirmative action, rightly or wrongly, was generally believed to entail lowering standards for persons of a given background, while diversity emphasizes that competitiveness imposes rigorous standards of performance and merit-namely productivity contribution. Third, affirmative action had a primary focus on hiring decisions, while diversity recognizes that the hiring date is only the beginning of creating an environment that unleashes the potential of all employees. Fourth, diversity is inclusive of all group identities - including White males. See generally R. Roosevelt Thomas, From Affirmative Action to Affirming Diversity, Harv. Bus. Rev., Mar.-Apr. 1990, at 107, 112 ("Managing diversity ... means enabling every member of your workforce to perform to his or her potential. It means getting from your employees everything they have to give."). Since Bakke, the Court has not heard a case positing that diversity, when properly managed, is a dimension of merit, separate and apart from being a justification for preferential affirmative action. "Managing diversity, by contrast, is driven primarily by business trends and the quest of organizations to maximize economic performance." Taylor Cox, Jr. & Ruby L. Beale, Developing Competency to Manage Diversity 17 (1997).

n4. Prior legal scholarship has generally not focused on the diversity initiatives discussed herein. Instead nearly all prior scholarship has focused upon diversity as a justification for racial preferences. E.g., Sheila Foster, Difference and Equality: A Critical Assessment of the Concept of "Diversity", 1993 Wis. L. Rev. 105 (assessing the concept of diversity as it has been used as a justification for affirmative action but failing to address diversity contributions as a dimension of merit); Jennifer L. Hochschild, The Strange Career of Affirmative Action, 59 Ohio St. L.J. 997, 1016-18 (1998) (discussing business community's desire to embrace diversity and lack of desire to assist politically in abolishing affirmative action); Bill Ong Hing, Beyond the Rhetoric of Assimilation and Cultural Pluralism: Addressing the Tension of Separatism and Conflict in an Immigration-Driven Multiracial Society, 81 Cal. L. Rev. 863, 882-86 (1993) (discussing economic benefits of diversity in the context of arguing that a Euro-centric vision of America must give way to a new vision of pluralism).

n5. Civil Rights Act of 1964, Pub. L. No. 88-352, 202, 78 Stat. 241, 255 (1964) (codified as amended at 42 U.S.C. 2000e-2000e-17 (2001)).

n6. For example, from Los Angeles comes the story of an auto dealership with a highly diverse sales staff, including mostly minority and immigrant managers, being able to leverage diversity into huge sales to a diverse population, catapulting the dealership to the top of the California market. Peter Y. Hong, Diversity Driven by the Dollar, L.A. Times, May 26, 1998, at A1 (recounting how a polyglot sales force helped Longo Toyota become the top dealership in the state and a multi-cultural model at the same time). See also Geoffrey Colvin, The 50 Best Companies for Asians, Blacks, and Hispanics, Fortune, July 19, 1999, at 52-57 ("The idea that many minority customers are highly aware of a company's minority friendliness is more important than many executives think."); Kenneth Labich & Joyce E. Davis, Making Diversity Pay, Fortune, Sept. 9, 1996, at 177 ("Many of [our] customers demand health care workers who are non-judgmental - and we have to make sure we provide them. With the customer base changing so rapidly, we are talking more and more about a diversity imperative within our company.") (statement of Barbara Stern, Vice President, Harvard Pilgrim Health Care). Fifty-six percent of Union Bank's new hires are minorities, 35.9% of its officials and managers are minorities, and 7 of its 17 directors are minorities. See Edward Robinson & Jonathan Hickman, The Diversity Elite, Fortune, July 19, 1999, at 62, 66.

n7. See generally John P. Fernandez, The Diversity Advantage 252-267 (1993) (summarizing evidence showing vestigial racism in corporate America); Deborah A. Ballam, Affirmative Action: Purveyor of Preferential Treatment or Guarantor of Equal Opportunity? A Call for a "Revisioning" of Affirmative Action, 18 Berkeley J. Emp. & Lab. L. 1, 20 (1997) (summarizing studies showing gender discrimination in the workplace).

n8. "Diversity in our company is itself a business imperative vital to our ongoing renewal and our competitiveness into the 21st Century," states John A. Krol, Dupont's President and CEO. The Conference Board, Report No. 1195-97-CH, Managing Diversity for Sustained Competitiveness 5 (1997) (on file with author) [hereinafter Conference Board 1997].

n9. Diversity is all about hiring people to further specific corporate missions. For example: "The strategic imperative to create a synergistic organizational culture that transcends any single national culture may be particularly acute for [multinational enterprises] facing competitive environments in which there are strong, simultaneous pressures for global integration and national responsiveness. Here competitive advantage hinges on successfully managing cultural diversity across product and labor markets." Gary W. Florkowski, Managing Diversity within Multinational Firms for Competitive Advantage, in Managing Diversity 339 (Ellen Ernst Kossek & Sharon A. Lobel eds., 1996).

n10. "The blinders of a Euro-centric view of America limit our vision and viability in the international economic community. There are simply too many cultural differences that have to be considered for the United States to be effective globally. The economy increasingly demands expertise in more than American or Euro-centric ways and customs." Hing, supra note 4, at 882.

n11. Specifically, corporate America has, in general, operated based upon an assumption that only White males were qualified for corporate positions in general, and particularly senior management positions. This pervasive discrimination has left corporate America in dire need of diverse perspectives. As Secretary of Labor, Robert Reich stated in 1995, after completing an intensive study of the "glass ceiling" that limits the progress of women and minorities in the business world: "the glass ceiling is not only an egregious denial of social justice that affects two-thirds of the population, but a serious economic problem that takes a huge financial toll on American business." Federal Glass Ceiling Commission, A Solid Investment: Making Full Use of the Nation's Human Capital 4 (1995) [hereinafter Glass Ceiling I]. "The "glass ceiling' is a concept that betrays America's most cherished principles. It is the unseen, yet unbreachable barrier that keeps minorities and women from rising to the upper rungs of the corporate ladder, regardless of their qualifications or achievements." Id. "Title II of the Civil Rights Act of 1991 created the 21-member, bipartisan Federal Glass Ceiling Commission." Id. at 9. The Commission consisted of Senators, Representatives, business leaders, and other political leaders, all appointed by President Bush. The Commission concluded: "The glass ceiling is a reality in corporate America." Id. The Commission's mandate was to study the barriers to the advancement of minorities and women within corporate hierarchies, to issue a report on its findings and conclusions, and to make recommendations on ways to dismantle the glass ceiling. See Federal Glass Ceiling Commission, Good for Business: Making Full Use of the Nation's Human Capital 6-7 (1995) (finding that a "glass ceiling" exists, that it operates to exclude women and minorities, and that it is detrimental to business) (citing Ann M. Morrison, The New Leaders: Guidelines on Leadership Diversity in America 34-39 (1992) (suggesting that prejudice is the primary barrier to corporate advancement, manifesting itself in a prejudgment that someone "different," such as a female, is less able to do the job)) [hereinafter Glass Ceiling II].

n12. See U.S. Equal Employment Opportunity Commission, Task Force Report on "Best" Equal Employment Opportunity Policies, Programs and Practices in the Private Sector 261 (1997) (diversity initiatives should include all employees, including white males, and should not cause or result in unfairness) [hereinafter Task Force Report]. In fact, diversity theory recognizes that White males also contribute to a diversity within a workforce; for example, Xerox is considered a "trailblazer" in diversity initiatives and is ranked number 20 in Fortune's "Diversity Elite," with 38% of its new hires being minorities. See Robinson & Hickman, supra note 6, at 64. Still, when Xerox discovered a dearth of White males at the entry level salesperson position, it adjusted its recruitment to hire more White males. See Jaqueline A. Gilbert et al., Diversity Management: A New Organizational Paradigm, 21 J. Bus. Ethics 61, 71 (1999). "Diversity management is a voluntary organizational program designed to create greater inclusion of all individuals ... ." Id. at 62.

n13. For example, 43% of new hires at Dupont are minorities. Two of its directors are minorities, 10.4% of its officers and managers are minorities, and two of its 24 highest-paid officers are minorities. See Robinson & Hickman, supra note 6, at 70. Other business leaders who have made similar statements regarding the positive use of diversity have similar statistical support showing they mean business about diversity: "We are in a war for talent. And the only way you can meet your business imperatives is to have all people as part of your talent pool - here in the United States and around the world." Colvin, supra note 6, at 52-57 (statement of Lucent Technologies CEO Rich McGinn). Thirty percent of Lucent's new hires are minorities. Nine of its 25 top paid officers are minorities, 19.5% of its officers and managers are minorities, and one of its nine directors are minorities. Robinson & Hickman, supra note 6, at 63. See also Rachel Emma Silverman, On Wall Street, A New Push to Recruit Gay Students, Wall St. J., Feb. 9, 2000, at B1 (reporting that the securities industry is facing an "unusually tight" labor market, and has for the first time focused recruiting efforts on gay and lesbian business students); supra notes 6, 12; infra notes 20, 25.

n14. See Task Force Report, supra note 12, at 3-7 (finding that diversity initiatives are the best practices of private employers for purposes of complying with Title VII and achieving equal employment opportunity).

n15. For purposes of this Article, the phrase "embracing diversity" has the meaning ascribed to the phrase in mainstream business circles. Specifically, embracing diversity means implementing organizational systems to manage people so that the potential advantages of diversity are maximized. Implicit in this concept is the goal of maximizing the potential of all employees. While diversity management is thus inclusive of all groups, an essential part of embracing diversity is recognition that value can be unlocked by including traditionally excluded groups, especially given the multi-cultural business environment of the future. See Elaine K. Yakura, EEO Law and Managing Diversity, in Managing Diversity, supra note 9, at 34-44. This Article, like the business community, uses the terms "embracing diversity," "diversity management," and "diversity initiatives" as essentially synonymous ideas.

n16. As one commentator has stated, "Without total acceptance of diversity and a business plan that completely integrates it into corporate strategic plans, a corporation cannot succeed in the global market." Fernandez, supra note 7, at 14-15.

n17. The expected shortage of working-age people will be a world-wide issue early next century. "Today the ratio of working taxpayers to non-working pensioners in the developed world is around 3:1. By 2030, absent reform, this ratio will fall to 1.5:1 ... ." Peter G. Peterson, Gray Dawn: The Global Aging Crisis, Foreign Affairs, Jan.-Feb. 1999, at 42, 44. The problem may be especially acute in the United States:

 

 Plummeting birthrates have corresponded with the rise of the knowledge-based economy, which demands more and more white-collar workers. Between 1998 and 2010, the number of managerial jobs will rise by 21%, according to Development Dimensions International, while the number of people between 35 and 50 will fall by 5%. Already, the median age of the U.S. workforce is nearly 40, up from 34.9 in 1979. Even with productivity gains and immigration, there won't be enough people to meet the demand.

 

Jennifer Reingold & Diane Brady, Brain Drain, Bus. Wk., Sept. 20, 1999, at 112, 114.

n18. "By the year 2040, one-half of the U.S. population will be African American, Hispanic/Latino American, Native American and/or Asian American. Women will fill 65 percent of the new jobs created during the 1990s; by the year 2000, nearly one-half of civilian workers will be female." Fernandez, supra note 7, at 11. When this Article refers to "traditionally excluded groups" it is referring primarily to the foregoing groups. However, diversity theory is broad enough to cover virtually any group. Thus, this Article argues that homosexuals should not be unfairly excluded from the workforce, and it posits that White males may in appropriate circumstances add diversity to a given organization.

n19. "The strategic imperative to create a synergistic organizational culture that transcends any single national culture may be particularly acute for [multinational enterprises] facing competitive environments in which there are strong, simultaneous pressures for global integration and national responsiveness. Here competitive advantage hinges on successfully managing cultural diversity across product and labor markets." Florkowski, supra note 9, at 339.

n20. Recent reports from the business world support a major premise of this Article: many companies are moving aggressively to embrace diversity. The best diversity practitioners have posted statistics showing that they mean business about diversity. For example, at SBC Communications, 51% of new hires are minorities, as is 36.4% of its total work force and nearly 20% of its board. See Robinson & Hickman, supra note 6, at 62-70. At Public Service Company of New Mexico, 48% of new hires are minorities, 33% of its board members are minorities, and 47.3% of its workforce are minorities. See id. These are not isolated examples. The top 50 companies identified by Fortune Magazine as the "Diversity Elite" all post impressive statistics. See id. Still, outside of those companies that are the leading edge of the diversity movement, the situation is grim, and much more needs to be done. In Northeast Ohio, for example, the Cleveland Plain Dealer surveyed the top 50 largest public companies in the region and found that only 5 of 417 executive officers in such companies were Black, and only 38 are women or minorities. See Sandra Livingston & Zach Schiller, Glass Ceiling Cracks - But Barely Few Executives Are Minorities, Survey Shows, Cleveland Plain Dealer, Oct. 3, 1999, at 15A.

n21. See David A. Thomas & Robin J. Ely, Making Differences Matter: A New Paradigm for Managing Diversity, Harv. Bus. Rev., Sept.-Oct. 1996, at 79.

n22. See Thomas, supra note 3, at 107.

n23. See Colvin, supra note 6, at 52-57; Robinson & Hickman, supra note 6, at 63; Silverman, supra note 13, at B1.

n24. See supra note 6.

n25. As one prominent CEO has stated, in explaining why his company needs more diversity: "If everybody in the company is the same, you'll have a lot fewer arguments and a lot worse answers." Colvin, supra note 6, at 54 (statement of Bell Atlantic CEO Ivan Seidenberg). Thirty percent of Bell Atlantic's new hires are minorities, 19.2% of its officers and managers are minorities, and 4 of its 22 directors are minorities. Robinson & Hickman, supra note 6, at 66.

n26. See Taylor Cox, Jr. & Carol Smolinski, Managing Diversity and Glass Ceiling Initiatives as National Economic Imperatives i-ii (1994) (University of Michigan, School of Business, Working Paper No. 9410-01, on file with author) (undertaking extensive review of literature regarding diversity management programs and finding that companies able to successfully manage diversity can achieve greater human resource efficiencies, increased marketing effectiveness, greater creativity, and innovation, and will, therefore, achieve better financial performance).

n27. The Conference Board was founded in 1916 for the purpose of improving the business enterprise system and enhancing the contribution of business to society. "The Conference Board strives to be the leading global business membership organization that enables senior executives from all industries to explore and exchange ideas of impact on business policy and practices." The Conference Board, Report No. 1130-95-RR, Diversity: Business Rationale and Strategies 2 (1995) (on file with author) [hereinafter Conference Board 1995].

n28. See id. at 7 ("As with any business function, program or initiative, diversity initiatives must prove to be essential components of business operations and meet the standards of good business practice.").

n29. See id. at 7-8 (citing the threats of lawsuits, low morale, loss of talent, and negative publicity).

n30. See id. at 11.

n31. See American Management Association, 1998 AMA Survey Senior Management Teams: Profiles and Performance, available at http://www.amanet.org/research/pdfs/senior.pdf. See also Society for Human Resource Management, Survey of Diversity Programs 10 (1999) ("SHRM has long recognized the competitive advantage gained by companies that seek and support a diverse workforce.") (on file with the Michigan Journal of Race & Law).

n32. See Society for Human Resource Management, supra note 31, at 1.

n33. Poppy Lauretta McLeod et al., Ethnic Diversity and Creativity in Small Groups, 27 Small Group Res. 248, 252, 257 (1996) (finding that ethnically diverse workgroups including Asian Americans; African Americans; and Hispanic Americans produced higher quality ideas than all-Anglo groups).

n34. See id. at 256-57 ("The ideas produced by the heterogenous groups were judged as significantly more feasible ... and more effective ... than the ideas produced by the homogeneous groups.").

n35. See Irving L. Janis, Victims of Groupthink 192 (1972) (undertaking intensive case studies of "groupthink" and finding: "Groups of individuals showing a preponderance of certain personality and social attributes may prove to be the ones that succumb most readily to groupthink.").

n36. See Irving L. Janis, Groupthink 250 (2d ed. 1982) (undertaking further intensive case studies and finding that group heterogeneity can stem "groupthink").

n37. See Taylor Cox, Jr., Cultural Diversity in Organizations 27-36 (1993) (reviewing nine studies of Hispanic Americans, Asian Americans, and African Americans and finding strong ethnic identities retained by each group as a result of fundamental life experiences; and concluding that therefore these traditionally under-represented groups offer employers value).

n38. See Susan E. Jackson, Team Composition in Organizational Settings: Issues in Managing an Increasingly Diverse Workforce, in Group Process and Productivity 138-73 (Stephen Worchel, et al, eds., 1992) (suggesting that ethnic diversity is related to organizational creativity and flexibility).

n39. Such research shows, for example, that diverse groups are more flexible, innovative, and creative. Anthony P. Carnevale & Susan C. Stone, The American Mosaic 60-61 (1995) (reviewing and collecting empirical data regarding the benefits of diversity in decision making processes).

n40. As one manager has stated: "If you don't have empathy and aren't able to communicate in diversity, are uncomfortable around a multicultural workforce, or if you are not confident enough to give an opportunity to someone who has a heavy accent or is different, you'll be a miserable failure as a manager." The World Comes to the American Workplace, Wash. Post, Mar. 20, 1999, at A1 (quoting William Edwards, General Manager of the Washington Hilton).

n41. Indeed, Professors McLoed, Lobel, and Cox specifically focused upon a marketing task in their experimental study of ethnic diversity in the context of small groups. The working groups were asked to generate ideas on how to increase tourism in the United States. See McLoed, supra note 33, at 254. Their ideas were then judged, blindly, by tourist industry experts, based upon feasibility and effectiveness. See id. at 255. Ethnically diverse workgroups, including African Americans, Hispanic Americans, and Asian Americans scored higher than all-Anglo groups. See id. at 252, 256-57.

n42. See, e.g., Thomas C. O'Guinn et al., The Cultivation of Consumer Norms, 16 Advances Consumer Res. 779, 785 (1989) ("Cultivation theory assumes that different demographic groups ... will have had different life experiences which will lead to different perception of social reality.").

n43. See Cox & Smolinski, supra note 26, at 26-28.

n44. Id. at 27 (quoting managers of insurance agency).

n45. Stacey Kole & Glenn MacDonald, Economics, Demography and Communication 3 (May 1999) (unpublished manuscript on file with the Michigan Journal of Race & Law). Kole and MacDonald focused upon the ability of gender identification to act as a facilitator of efficient communication between customers and employees. Their study utilized employment data from 12 developed nations. This data evidenced sectoral employment patterns across the 12 economies consistent with this "communication-based theory of diversity." It appears that women are being drawn into product delivery positions (where communication skills have great value) rather than product production positions. See id. at 39-40.

n46. See id. at 3.

n47. Cox & Smolinski, supra note 26, at 27-28 (quoting Miami Toyota dealer Richard Goldberg).

n48. Indeed, indulging customers' bigoted attitudes by hiring people reflecting their preferences has always been illegal under Title VII. E.g., Fernandez v. Wynn Oil Co., 653 F.2d 1273, 1276-77 (9th Cir. 1981) (holding that gender preferences of customers did not justify hiring only males).

n49. See Janine S. Hiller & Stephen P. Ferris, Separating Myth from Reality: An Economic Analysis of Voluntary Affirmative Action Programs, 23 Mem. St. L. Rev. 773, 795 (1993) (finding that empirical data showing future profitability is enhanced by efforts to encourage the development of a diverse workforce).

n50. See Gilbert, supra note 12, at 65-66 (summarizing "bottom line results" achieved at 11 companies "from effectively managing diversity").

n51. See Jacqueline A. Gilbert & Bette Ann Stead, Stigmatization Revisited: Does Diversity Management Make a Difference in Applicant Success, 24 Group Org. Mgmt. 239, 252 (1999) ("With the majority of new hires in years to come being women and minorities, providing an active diversit