- Human Resource Executive recently reported that while traditional research often measures diversity in demographic terms, one team of researchers took a different approach to considering diversity among banking company leaders and found that U.S. companies with more executive-team diversity made more for their investors over time.
- The Wall Street Journal recently reported that having female executives is good for a company’s bottom line, according to the finding of a report by the Peterson Institute for International Economics. The institute surveyed 21,980 publicly held firms from 91 countries to determine how the gender makeup of companies’ upper ranks is related to their financial performance.
- And McKinsey and Company research found that companies in the top quartile for gender or racial and ethnic diversity are more likely to have financial returns above their national industry medians. Companies in the bottom quartile in these dimensions are statistically less likely to achieve above-average returns.
Yet the current state of diversity and inclusion in American business landscape is spotty. Yes, progress has been made, yet real gaps remain. XpertHR recently surveyed over 600 employers about their diversity and inclusion progress and plans and found some startling, and other more expected, results. Key findings in the survey include:
- More than half of workplaces report that diversity has increased over the past five years.
- Ethnic and racial diversity are the traits most aggressively recruited, followed closely by veterans.
- Geography has played a role in the diversity of two thirds of workplaces, with one fifth reporting being hurt and more than four in ten being helped by their geographic locale. Furthermore, global employers are far more likely to have diversity initiatives in place than their US-only counterparts.
- Nearly half of workplaces do not consider religion a diversity criteria and more than four in ten do not consider sexual orientation.
- The most challenging aspects of diversity and inclusion programs are the time required to manage, benchmarking of D&I efforts, and resistance to change.
- The three diversity initiatives prioritized for the coming 5 years are formation of affinity groups, instituting mentoring programs and/or career development programs for diverse employees and a focus on supplier diversity.
- The larger the employer, the more likely the workplace has a formal diversity and inclusion program, staff dedicated to D&I, and active recruiting for enhanced diversity.
- Global employers are more likely than US only employers to have a formal D&I program, a more diverse workforce, and increased diversity in the workforce in the last 5 years.
Too often, diversity and inclusion efforts fail due to any combination of the following reasons:
- Treating diversity as compliance (EEO and diversity are NOT synonymous);
- Not being aligned with key business strategies and plans;
- Lack of support from senior leaders;
- Not a human capital nor culture priority; and
- Not having the right leader for the role.
This, according to Graciela Meibar, (30+ years in diversity and inclusion roles, including as VP of Global Diversity at Mattel), in a recent webinar Building a Global Diversity and Inclusion Strategy (available free on demand).
Meibar offers key success factors for a diversity planning process based on her years of practical experience as a diversity executive:
- Identify and include all key stakeholders. Engage CEO continually.
- Make it relevant to business goals. What are the issues that are worrying the leaders?
- Identify key sponsors.
- Manage expectations.
- Analyze and move forward.
- Develop and start implementing a communications plan.
- Monitor and report.
The key success factors for a diversity initiative, according to Meibar, are:
- Business alignment / focus;
- CEO and senior management engagement;
- Meaningful metrics;
- Practical accountability;
- Manage expectations; and
- Communications, communications, communications, …
Yet all the talk of diversity and inclusion in recent years appears to have led to a bit of “diversity fatigue”, a trend reported by The Economist earlier this month, addressing this phenomenon of D&I in workplaces being talk and effort without substantive culture change or notable successes. According to The Economist, “making the most of workplace diversity requires hard work as well as good intentions.” A few small initiatives, with limited results, do not constitute a true diversity initiative. Unfortunately, “most people pay lip service to diversity in public… what they think in private can be very different.” Focused, supported, and sustained effort, with management support and a true internal champion are the hallmarks of what make a strong diversity program. “Diversity does not produce better results automatically, through a sort of multicultural magic. It does so only if it is managed well.”
If you have a diversity initiative or are planning one, be sure to follow Meibar’s lessons learned to optimize success and avoid diversity fatigue in your workplace:
- Leadership support is critical. To achieve it you need to engage them on what matters to them.
- Be strategic and deliberate in your initiatives.
- Self-awareness and purpose is critical. Educate and develop yourself and your advocates.
- Incorporate it into your cultural norms. Don’t copy what someone else has done.
- ERG have to be self-started and momentum is kept through purpose and clear objectives.
Do you have additional perspective to share? Please comment – I’d love to hear from you!