Efforts to diversify at all levels and proactively foster a sense of belonging remain top priorities for companies going into 2023 and beyond. According to Glassdoor, 76% of job seekers and employees today report that a diverse workforce is an important factor when evaluating companies and job offers. Candidates and current employees expect it, and many view a lack of DEI planning as a negative when considering a job offer.
Diversity is the mosaic of people who bring a variety of backgrounds, styles, thoughts, perspectives, values and beliefs as assets to the groups and organizations with which they interact.
Equity is fair and just practices and policies to ensure that access, resources and opportunities are provided for all to succeed and grow, especially for those who are underrepresented and have been historically disadvantaged.
Inclusion fosters a sense of belonging and feeling respected, valued and seen for who we are as individuals. There is a level of supportive energy and commitment from leaders, colleagues and others so that we – individually and collectively – can do our best work.
In addition to being the right thing to do, diversity efforts lead to better business performance. Organizations in the top quartile of ethnic and cultural diversity outperform those in the bottom quartile by 36%. When boards of directors are in the top quartile of gender diversity, they outperform their peers financially by 28%. (McKinsey)
While DEI initiatives are a priority for many organizations, the necessary resources are not always available to meet the needs. In their report on DEI in the workplace, Culture Amp found that:
- 74% of HR and DEI practitioners felt senior leadership supports their DEI efforts
- 34% feel they have sufficient resources to support this work
- The same study showed that only 42% of companies surveyed had an explicit, documented DEI process in place
- 58% have a DEI policy in name only
Benefits of DEI Initiatives
Here are some of the reasons why DEI initiatives are important in the workplace.
1. Encourages innovation
Studies show that companies that have more diverse management teams have 19% higher revenue due to innovation (Forbes). Pooling together a diverse group of people that come from different backgrounds and experiences fosters creativity and innovation. This is because each of these people brings a unique set of knowledge, skills and wisdom to the table. Having unique perspectives on your team helps with being able to find the best solution to challenges, promotes quick decision-making, and allows for more effective ways to tackle a project.
2. Brings financial success
As mentioned, a diverse team fosters innovation and allows for innovative and more creative approaches to conducting business. This means that a diverse workforce will help put forward new ideas, products, market solutions and effective solutions to help the business succeed. According to Forbes, firms are 33% more likely to experience industry-leading profitability if their executive teams represent more cultural and ethnic minorities.
3. Fosters a sense of belonging
When a company focuses on building a diverse and inclusive team, people feel like they belong to a culture that values their beliefs and takes their ideas and thoughts into consideration. Employees that have a sense of belonging in their company are more engaged and feel more of a part of the company and therefore will want to help in its success.
4. Improves employee retention
An engaged workforce is a productive workforce. With DEI efforts, employees feel supported and that they are in an environment that is comfortable and open. Diversity and inclusivity allow employees to feel more engaged in the culture of the organization, prompting them to want to stay at the company for longer.
5. Access to a bigger talent pool
Removing prejudice and bias during the recruitment process can open a lot of doors to top talent for your business. You are able to tap into a diverse market of professionals with all the right skill sets. Removing biases can help you ultimately tap into a market that will find the best candidate in the long term, as opposed to finding a candidate from a small pool that may fit your needs at the time.
6. Combats WFH burnout
Forbes states that inclusion in the workplace can help fight WFH and remote burnout. Working remotely can make people feel isolated. Therefore, trying to promote a sense of belonging and inclusion within the company will help engage employees and make them feel like they are a part of something. This helps increase overall productivity as well as employees’ sense of well-being and happiness with their jobs.
Some industries and organizations are formalizing efforts to increase diversity and inclusion with specific requirements or certification programs. In late 2021, the US Securities and Exchange Commission (SEC) approved NASDAQ’s board diversity and disclosure rules, which require NASDAQ-listed companies to disclose board-level diversity data and required two diverse directors—or explain why they don’t meet this requirement. (Morgan Lewis)
Likewise in the legal industry, the Mansfield Rule and certification program formally measure “whether law firms have affirmatively considered at least 30% women, lawyers of color, LGBTQ+ lawyers, and lawyers with disabilities for leadership and governance roles, equity partner promotions, formal client pitch opportunities, and senior lateral positions.” (Diversity Labs)
DEI efforts are a necessary and positive part of any organization. By becoming a more diverse and inclusive workplace, your organization will welcome unique ideas, encourage creativity, and ultimately have happier employees. This, in turn, leads to higher revenue and a great place to work overall.
Keep in mind to ask your employees for their opinions and feedback and involve your employees throughout your DEI initiatives. It’s the best way to ensure that you are incorporating these strategies in the most authentic and genuine way where your employees will want to be involved and feel like a difference is being made.
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