Minority Challenge: AOL Time Warner tries for diversity

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Many minorities who work at AOL Time Warner feel they have few opportunities to follow incoming CEO Richard Parsons up the corporate ladder. But the media giant is taking steps to improve diversity, Crain's New York Business reports today.

When Mr. Parsons takes the reins of AOL Time Warner in May, he will become one of a handful of African-Americans leading a Fortune 500 company. But Crain's, a sibling publication to Advertising Age, reports that none of the company's eight operating units is run by a minority and that there are just two minority executives who report to the CEOs of those units. The divisions, including Time Inc., HBO, Turner Broadcasting System and Warner Bros. Studios, market their magazines, TV shows and films to a diverse U.S. population.

short of goals

While 13% of AOL Time Warner's 74,000 U.S. employees are African-American, according to the Crain's article, just 3% are at or above the VP level. Hispanic employees make up 10% of the U.S. workforce, but only 2% are at or above VP, the article states, citing an unnamed source.

AOL Time Warner disputes the numbers, but declined to provide the magazine with alternative figures. The media giant does, however, acknowledge that it has fallen short of its diversification goals and said it is taking steps to improve its record of hiring and promoting minorities.

"It's been a priority for the company for the last several years," Mr. Parsons told Crain's. "But we haven't done nearly as good a job as we need to do."

"We need to spot talent earlier and manage the careers of people more proactively to build a talent pool from which we can draw," he said.

AOL Time Warner hired former ABC Television President Patricia Fili-Krushel as exec VP-administration five months ago to spearhead its diversity effort. "We are a consumer business and we need to reflect the consumers we market to," Ms. Fili-Krushel told Crain's. "I feel really passionate about this."


Crain's reports that Ms. Fili-Krushel put together a six-point plan to correct the issues around the recruitment and promotion of women and minorities in all of the company's operating units, and to have the company's consumer properties better reflect the diversity of the population. The plan also includes philanthropic efforts, investment in minority companies and an effort to diversify suppliers.

Division chief executives such as Time Inc.'s Don Logan and Warner Bros.' Barry Meyer submitted diversity plans to Ms. Fili-Krushel in November, according to the article. She has hired a diversity talent recruiter to develop a database of qualified minority applicants, and has so far rejected a plan to tie diversity goals to compensation.

"For the first year," she told Crain's, "we'll use a carrot, not a stick."

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