In our combined two and a half decades of work in the Gender, Diversity and Inclusion space, we’ve identified a clear need to start integrating equity and diversity efforts as early as possible into a company’s DNA. Companies that start with a Diversity and Inclusion (D&I) mindset, leadership buy-in and concrete investments, grow inclusively in an organic way, and ultimately have to spend less on retrofitting efforts to eliminate a toxic workplace culture down the line.
In the second installment of our series on D&I Fundamentals, we look at addressing the challenge of leadership buy-in. Most commonly the first step in building support for D&I, is by making the ‘business case.’ This approach focuses on the ways in which D&I can contribute to the company in terms of the bottom line. It’s important also to note that while risk mitigation is not usually part of a business case, it can also offer a powerful incentive for investing in D&I.
Why should you invest in Diversity and Inclusion?
Better Financial Performance
The business case for diversity is clear. McKinsey research shows that when companies are more gender and ethnically diverse, they financially outperform companies that are less so by 21% and 33% respectively. They also found that having gender and ethnic diversity on executive teams and in line roles (versus staff roles) specifically, to be consistently positively correlated with higher profitability of a company.
Retain Top Talent
Creating a culture of inclusion where everyone feels respected and valued creates a better working environment which increases retention rates, reduces harassment rates and reduces turnover. In the Kapor Center “Tech Leavers Study” they found that employee mistreatment is the main reason tech employees voluntarily chose to leave their highly paid jobs. Women in tech were two times as likely to quit as men, while Latino and black employees were 3.5 times as likely to quit as their white or Asian colleagues. 1 in 10 women in tech reported experiencing unwanted sexual attention at work.
Speak to your Customer Base
Most companies have a diverse customer base. In order to build the right products and services for them, they must have diverse representation internally. Research has shown that the diversity of a company is directly related to customer satisfaction and the ability to deliver an improved and therefore profitable customer experience. A workforce that reflects the market it serves yields an empathetic and first-person understanding of customer expectations, of product expectations, and brand experience.
Increase Employee Engagement
Engaged employees are core to the success of any business, especially those whose competitiveness relies on their high performing workforce. Understanding levels of engagement in a company and measuring it over time can inform what types of development or programs are needed to increase performance, retention and create a more inclusive culture. Engaged employees are 17% more productive than their peers, and 41% lower absenteeism among many other benefits.
More Innovation & Decision-Making
Research on effective decision-making cultures shows that teams that proactively fight groupthink and conformity are more successful over time, leading to increased innovation. Research shows that decisions executed by diverse teams delivered 60% better results and ‘inclusive’ teams make better business decisions up to 87% of the time.
For a more in-depth look at how to address D&I in your organization, download our D&I Fundamentals Handbook for Startups.
To set-up a complimentary one-hour consultation on your Diversity & Inclusion needs, reach us at email@example.com.