Man, that sounds like an incredible system! The company that I am working for currently is, frankly, desperate to keep people on staff and struggling to hire competent people to fill the roles we have open. I really can't see them going for anything of that caliber of hiring process any time soon, but I will absolutely keep that in mind.
And, yep, even though it's only your and my own opinion, it certainly seems like some form of mandated quota, initiative, etc. does seem to cause some level of damage, whether it be as bad, or worse, than the thing it's trying to defeat. It's not so much an outer thing, but an inner thing that gnaws at your confidence and ability.
I find the idea of offering some kind of special leverage to be demeaning in a way I can't quite express. To my ears, it comes off as, "We know that you can't win without our help, so we'll throw you a bone. Be grateful to us now." I get that's not the intention, but man, it's hard to even see how the outcome is all that different. I just want to see myself, and others succeed purely based on merit. On doing a good job. And if that means that a manager, "See's a lot of white faces in the office" then it ought not be seen as a problem, but instead - shocker - the companies workforce. To not see those workers as some metric. The idea of being counted out like grapes for some fruit salad...it's just crushing.