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Wall St. and Business Wednesdays: The 2006 Edition Of The NAACP Consumer Choice Guide

After a decade of tracking and observing how some of the nation's largest companies and industries treat consumers of color, the NAACP reports that while positive change is occurring, companies across all industries need to commit to continuous improvements in order to break through to the next level of performance.

The 2006 edition of the NAACP Consumer Choice Guide, commonly known as the 'business report card,' is part of the Association's Economic Reciprocity Initiative (ERI) and now available. The guide and related report, released during the NAACP's 97th Annual Convention in Washington, D.C., provides consumers with tools for empowerment, enabling them to make informed choices when choosing services in surveyed industries.

"African Americans pump roughly $650 billion into the American economy annually," said NAACP President & CEO Bruce S. Gordon. "We should spend wisely and have readily available information to be assured that those we do business with are reinvesting in our community, employing a diverse work force, utilizing minority vendors and supporting our causes. Those not practicing such measures should not benefit from the economic power we provide. There continues to be opportunities for major corporations to improve their performance."

In 1996, the NAACP launched the ERI as a sustained consumer movement to measure corporate America's financial relationship with the African American community. Since then, the ERI has expanded its scope and has continued to annually highlight diversity efforts made in lodging, telecommunications, financial services, general merchandising and automotive industries.

"We are pleased to say that over time, all of the industries have seen an improvement in their grades," said NAACP National Policy Director John H. Jackson. "The Association is encouraged by past success and excited about future plans for the initiative. Working hand in hand with our corporate and non-profit partners, we can make a tremendous impact on American corporations’ move toward greater diversity and meaningful economically reciprocal relationships."

Each of the industries is rated in five performance areas. Information contained in the report is based on data provided by participating companies in 2005. Survey questions are graded and assigned point values which are translated into a letter grade.


This year's grade for the lodging industry is a C+, marking slight improvement over last year's C. The lodging industry has come a long way since its first grade of D- in 1997. Over the years, with a series of mergers and acquisitions, the lodging industry has improved its overall industry grade. Adam's Mark, Marriott, Hyatt and Cendant all earned a B-. Omni, Choice and Hilton hotels earned a C+ while Lowes, Intercontinental, Starwood and Carlson all received a C. Best Western earned a D+.

This industry tends to be most responsive in charitable giving, but has its greatest challenges in property ownership and vendor relationships. While the industry expresses a willingness to explore incentives to increase African American property ownership, very little change has been demonstrated.


This year's grade for the telecommunications industry is B-, improving over last year's C. The telecommunications industry has made noticeable progress since its first grade of C in 1998. BellSouth led the firms with a B+ followed by Verizon, AT&T and Spint Nextel all of who made a B in the latest round of grading. Alltel and Cincinnati Bell recorded a C+. Qwest got a D+. Excel received an F for not responding for five consecutive years.

Charitable giving is the strong suit of this industry but it ranks slightly below average in advertising/marketing. Although the companies have programs to increase supplier diversity, those mechanisms have yet to fully translate into substantial minority business contracts.

Financial services

The financial services industry received a C, maintaining its ranking from 2005. SunTrust Banks, Inc. and Wachovia Corp. led the grouping with Bs. Bank of America and KeyCorp had B- ratings. Bank of New York, Citigroup, Inc., PNC Financial, J.P. Morgan Chase and National City each earned a C. Bancorp and Wells Fargo & Co. received a C. The industry had a D+ overall when first rated in 2000.

Over all this industry tends to have strengths in community reinvestment and charitable giving, but has only modest performance in employment, advertising/marketing, and vendor relationships.

General merchandising

Major retailers in the general merchandising category slipped a bit over last year to obtain a C- rating overall. They had a C last year, which was much better than their first grade of D in 2003. Individually, Wal-Mart Stores Inc, received a C+, Federated Department Stores got a C and Nordstrom, Inc. a C-. J.C. Penney Company, Inc. recorded a D+ and Saks, Inc. received a D. Sears Holdings Corp., Dillard’s Inc., Kohl’s Department Stores and Target all earned Fs by refusing to respond to the survey.

Of the five companies that responded to the survey, all had African American representation on their boards of directors—and two (J.C. Penney and Wal-Mart) had more than one black seated. However, employment here remains average.


The automotive sector held the line with a C rating this year. Daimler/Chrysler and Ford received a B-. Toyota had a C+ while General Motors, Nissan, Honda and BMW each earned a C. Hyundai received a C- compared to Mitsubishi and Volkwagen’s D+. The industry had a D+ in 2003 which was the first time it was graded.

Charitable giving by this industry was positive, but vendor relationships and advertising/marketing need improvement as they are below average.

Complete details of the 2006 Consumer Choice Guide and NAACP Economic Reciprocity Initiative Report, including individual company scores, can be found at: under a special link on the home page.

Founded in 1909, the NAACP is the nation's oldest and largest civil rights organization. Its members throughout the United States and the world are the premier advocates for civil rights in their communities, conducting voter mobilization and monitoring equal opportunity in the public and private sectors. The preceeding was released by the NAACP Office of Communications.

Wednesday, July 26, 2006

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