Method
Sample
Data for this study were gathered from 112
large public companies in various industries.
An article appearing in Fortune magazine
(Robinson and Hickman, 1999) influenced the
initial data-gathering effort. The Fortune article
presented information regarding the best
company work environments for minorities in
America. With the help of the Council on Economic
Priorities (CEP), a non-profit research
firm, Fortune sent surveys to the Fortune
1,000 and 200 other large firms collecting
information regarding diversity employment
and programmes. 137 firms responded to the
survey. Fortune used these data to present
tables chronicling the number and percentages
of minorities in management positions.
We contacted Fortune and were granted
access to these data, as well as information on
the Equal Employment Opportunity Commission
compliance information for the public
companies surveyed. Twenty of the original
companies had to be excluded from further
study because they were private firms and
financial data would not be publicly available.
Of the 117 remaining companies, the largest
number came from manufacturing (34 per
cent consumer non-durable and 23 per cent
durable goods). Other industries included the
financial services sector (17 per cent), and
transportation/utilities (8 per cent).
Three companies had to be eliminated from
analysis due to missing data, and two companies
were excluded as outliers because their
results were 20 standard deviations away from
the mean on the ROA and ROI measures. Consequently,
112 companies with complete data
were included in the analysis. The average