Diversity, equity, and inclusion: these are more than buzz words. Companies that make meaningful strides toward accomplishing equality in the workplace perform better. Last month, Thomson Reuters hosted a webinar, Leading by example: Why embracing diversity and inclusion is about more than compliance. Our panel consisted of three women with unique perspectives on the topic of diversity and inclusion:
- Anna Wood, Consultant- Organizational Development, Strategic HR Management, Leadership, and Career Development
- Helen Chan, Regulatory Compliance Expert, Thomson Reuters
- Natalie Runyon, Director of Enterprise Content, Thomson Reuters
As the panelists discussed, there is a strong business case to be made for improving diversity and inclusion (D&I). Benefits include higher employee engagement, better reputation, and financial profitability. Specifically, companies in the top-quartile for gender diversity on executive teams were an astounding 21% more likely to outperform on profitability.
Diversity and inclusion targets
Corporations worldwide are working to implement D&I strategies that help uncover unconscious bias and build a path toward progress. Webinar panelist Anna Wood suggests that one of the first things leadership can do to change an organization’s culture is this, “Survey employees to get a sense of their perception and feeling around the firm’s commitment level to diversity and inclusion, in addition to written policies and practices. Next, establish a baseline using an organizational survey.”
Anna reinforces the importance of setting diversity targets across the organization, citing Adidas’ example in which they set a goal of increasing the number of women in leadership roles. To do so, they put several measures in place, including an executive-led mentoring program. The result is an increase in women in leadership roles from 24% in 2011 to 33% in 2019.
To improve D&I, Anna Wood identified steps along a roadmap to success. After assessing employees and establishing a baseline, organizations are encouraged to:
- Imbed D&I throughout the employee life cycle – recruitment, selection, performance management, advancement, training, development opportunities, compensation and benefits, exit survey/interviews, etc.
- Set up talent management systems such as succession planning and mentorship
- Promote equity, identify bias and systemic barriers to equity across the employee life cycle and talent management systems
- Involve stakeholders
- Dig deeper and speak to diverse groups to gain insight into their experience
- Set D&I targets and measure progress – analyze retention/track attrition; review exit surveys, grievances, lawsuits, etc.
- Promote accountability
- Gather continuous employee feedback
But surveying your organization for personal data such as gender, race, and ethnicity can be difficult. In the EU, the General Data Protection Regulation (GDPR) requires consent for the collection and use of such information. How can diversity and inclusion targets be met when an employee does not provide their consent?
For employers subject to the GDPR, there are noteworthy exceptions. Helen Chan said the critical exception is for employers who are required to collect such data to comply with specific laws. Helen noted that, “Additionally, an exception is available in cases where the employee gives explicit consent. This second exception gives flexibility to employers to encourage self-reporting, with consent, from employees”.
Further, Helen shared practices that have been adopted by the US Equal Employment Opportunity Commission for encouraging self-reporting that may be of interest to non-US employers as well:
- Accommodate anonymous self-reporting as much as possible
- Anonymous data should be processed where possible to reduce the risk of misuse
- Allow employees to self-identify and not question the self-identification even if they believe the response should be different from what is self-reported
- Provide clear notice to employees that the disclosure of sensitive data is voluntary and explain how the data will be used
After you have set your D&I targets and encouraged data collection, the next logical step is to measure progress against your baseline. One of the great ways to do this is to dig deeply into the company’s promotion and bonus patterns. But how do you know if your company has achieved equality in promotions and bonuses? When asked, Natalie Runyon offered this advice, “First, ask your HR or D&I team to see if they have done analyses to ensure equity in pay, promotions, and bonuses. If they say no, politely, ask how to request that one be done formally.”
Measuring success in D&I is not only a socially responsible decision but one that benefits a company’s bottom line. All of this begs the question, at what moment is a company considered to be diverse? According to Natalie Runyon, this is a benchmark that each company must determine for itself. “I would refer to the demographics of your customer base and industry competitors for guidance. Generally, gender balance (50/50) in senior roles and on boards with 30-40% of ethnic representation are good targets to shoot for.”
When it comes to D&I, a key takeaway is that change starts at the top. Once the mindset moves beyond compliance, leadership teams can create a safe environment, build a foundation of trust, and start making meaningful strides toward a more equitable and profitable organization.