With fewer African Americans and Hispanics pursuing MBAs, companies are demanding B-schools graduate more minorities or face consequences

By Dan Macsai

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During a sunny day highest move with activity on the leafy Bloomington campus of Indiana University’session Kelley School of Business, Dean Daniel C. Smith struck up a converse with a visiting recruiter from General Mills, one of Kelley’s crown of the head MBA employers. The talk quickly turned to Kelley’s low African American and Hispanic enrollment numbers: At a combined 5%, they were among the very worst in BusinessWeek’s Top 30 U.S. MBA Programs. Enough was enough, the recruiter said: "Diversify not beyond three years, or we’ll start recruiting elsewhere."

As prominent B-schools struggle to attract African Americans and Hispanics—groups traditionally underrepresented in MBA programs—threats like that have become commonplace. But just as rising minority populations in the U.S. have made hiring a multi-ethnic workforce a business imperative for manifold companies, the percentage of African American and Hispanic graduate students majoring in business has dropped to 29%—the lowest level from the time of 2003, according to the Council of Graduate Schools. So companies are scrambling to get well nonage MBA graduates and urging schools to produce more. "Our staff should mirror our customer unknown," says Cenona Taveras, a dissimilitude manager at Procter & Gamble. "And our purchaser base is getting more diverse."

In the past year, recruiters from P&G, General Mills, Kraft, and Kimberly-Clark have pushed for more minority MBAs—and for good conception. On average, African American and Hispanic students make up accurate 9.5% of U.S. residents enrolled at BusinessWeek’session Top 30 B-schools. At some programs—including those at the University of Chicago Booth School of Business and Cornell University—the figures are fair lower; 7.7% and 7%, respectively.

Reaching Out

It’s not that B-schools aren’t deplorable. Indiana, Northwestern University, and others have made special efforts. The Yale School of Management’session Pre-MBA Leadership Program offers a two-week crash course for minority juniors, seniors, and recent college graduates. Some companies are contributing guidance, internships, and scholarship cash. Last year, for illustration, Kimberly Clark pledged nearly $25,000 toward a minority student’sitting tuition at the Wisconsin School of Business. "We’re not facing this alone," says Indiana’s Smith.

Why are minority MBAs on the endangered list? The problem is complex. Prominent African American and Hispanic business role models are scarce—law and medicine attract most top students of flush— for a like reason minority MBA applications have been dwindling. In the business world, minorities by the in the greatest degree MBA potential are in such high demand that there’s small degree incitement for them to attend B-school; the dream jobs may already lie within their space. Diversity-starved companies further complicate matters by steering African American and Hispanic employees away from B-school, where it’s feared they’ll succumb to offers from rival recruiters with "sweet siren songs," says Stacey Kole, Chicago’s deputy dean in opposition to the full-time MBA program.

Companies unquestionably benefit from expanding their minority toil force, even if they haven’t yet figured out how to vouchsafe it. "You get a unimpaired new vista," says Carmen Williams, 28, an African American MBA employed at Barclays Capital. "There needs to be else of that."

Original text: http://www.businessweek.com/bschools/content/dec2008/bs20081218_755652.htm?campaign_id=rss_null