Menendez Survey Draws Scrutiny

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    NEWSLETTERS

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    Schumer to the rescue!

    Sen. Robert Menendez (D-N.J.) has begun an unofficial “diversity survey” of Fortune 500 companies and has told the companies that if they do not participate in the survey, he will make their names public.

    The survey has already drawn fire from the U.S. Chamber of Commerce as “a fishing expedition” and from legal experts, who say companies may violate federal employment laws by even asking such questions of their employees or suppliers.

    Menendez, the only Hispanic in the Senate, wants to find out how many minorities, women and disabled people serve as top executives or members of the firms’ corporate boards, as well as the “demographic makeup of your suppliers.”

    If a company responds to Menendez’s request, its information will be kept anonymous, although it will be aggregated in a report Menendez plans to issue later this year.

    “Completion of this survey will show your commitment to improving diversity among the highest ranks of your corporation,” Menendez wrote in a March 8 letter sent to the companies.

    “I fully intend to have a public presentation of the data compiled from companies that participate, as well as shed light on those that do not. My goal is not to embarrass but instead to work with you to promote our shared goals of diversity.”

    Menendez said the survey had nothing to do with being chairman of the Democratic Senatorial Campaign Committee, where one of his main roles is raising money and courting wealthy donors. And he rejected any suggestion that a company that did not comply with the survey could be the object of a boycott.

    “The good news is that we have gotten feedback from over 100 of the companies already,” Menendez said Thursday. “Our goal, in essence, is to have a snapshot of where Latinos are in terms of corporate boards, senior management and procurement, then to work with companies to help them in their own bottom-line interests.” 

    Menendez’s office said it had consulted the Senate Ethics Committee prior to sending out the survey request, although no formal approval was issued by the ethics panel. And Menendez said his position as a senator gave him all the authority he needed to question companies about their employees or diversity policies.

    “I could ask anybody anything at any time,” Menendez said. “Whether they choose to answer it is their decision.”

     

    But Fortney Scott, a Washington law firm specializing in employment practices, posted a message on its website stating that “the [Menendez] survey requests information that otherwise typically would not be in the public domain and need not be disclosed to the government under existing reporting procedures.”

    “Many employers believe that he’s asking about information that their own employment counsels have told them, ‘Don’t ask,’” said Burton Fishman, a deputy solicitor at the Labor Department under former President George H.W. Bush who is now of counsel to Fortney Scott.

    “And they’re not supposed to ask about ethnicity, about disabilities. ... About your contractors, why would a company ask about their demographic makeup? Many, many people believe, and have been counseled by people like Sen. Menendez, that they’re not supposed to ask that information.”

    Menendez said the criticism was misguided. “First of all, obviously it’s voluntary,” Menendez said. “Secondly, I find it incredibly difficult to understand why any corporation would not be willing to help us create, in essence, a census ... of where the standings of Latinos are in corporate America.”

    And if a company doesn’t comply?

    “We’re just going to simply say these companies didn’t think enough of trying to help the Latino community come to an understanding of where the aggregate numbers are in terms of Latino representation” in the corporate world, Menendez said.

    Menendez aides pointed to the fact that the Equal Employment Opportunity Commission does an annual survey of U.S. companies with more than 100 employees, or federal contractors with 50 or more employees, to determine the job rates for women and minorities in the private sector.

    However, the responses provided by individual companies to the EEOC are kept confidential.

    The 2008 EEOC survey showed Hispanics made up roughly 13.5 percent of the work force for the companies surveyed but held only 3.8 of the senior-level or management positions.

    John Guerra, CEO of the New America Alliance, a Latino business group, said the Securities and Exchange Commission has also begun to ask publicly traded companies to supply information about their corporate boards.

    But the SEC rule that Guerra cited allows companies to “define diversity” by their own standards. This may include “differences of viewpoint, professional experience, education, skill and other individual qualities and attributes that contribute to board heterogeneity” and not necessarily “diversity concepts such as race, gender and national origin,” according to the final rule published by the SEC on Dec. 23.