DEIB: a business necessity, not a nice-to-have

It has been astonishing to see how quickly diversity and inclusion has evolved over the past few years. It has matured into a broader dialogue around diversity, equity, inclusion and belonging (DEIB), a concept that promotes the active creation of psychologically safe workspaces where everyone can thrive as their authentic selves. And while many leaders have vowed to move the dial on DEIB, economic uncertainty, fears of a recession and the rising cost of living have prompted many organisations to re-prioritise. As a result, DEIB has been disproportionately impacted by these decisions - and not in a good way.

Indeed’s latest DEIB report found that when it came to listing their top eight business priorities, survey respondents ranked DEIB as second to last. This suggests that when push comes to shove, DEIB is seen more as a tick box on the corporate social responsibility check list than a business necessity and relegated to the ‘nice-to-have’ pile.

In a market where DEIB is a non-negotiable for eight out of 10 job seekers, businesses need to change their view on DEIB. Not only is there an ethical and moral imperative, but there is growing evidence directly linking DEIB with improved business performance.  Therefore, the view of DEIB as a ‘soft’ endeavour must change. Leaders need to see it as the driver of success that it really is.

The business case for DEIB

There have been many reports and studies discussing DEIB’s positive effects on employee satisfaction and engagement. But what has been most impressive is how significantly it improves financial performance. 

McKinsey found that organisations who take a business-led approach to DEIB are 36% more likely to achieve above-average profitability. It also discovered that companies with over 30% women executives are more likely to outperform companies with a lower percentage of senior female representation. Deloitte also learned that DEIB raised the competitive advantage of manufacturing companies by 46% and increased financial performance by 34%.

And the benefits of DEIB go far beyond commercial outcomes. According to Cloverpop, inclusive and diverse teams also make better decisions 87% of the time with half the meetings, and decision team results improved by 60%. Accenture found that creating a sense of belonging among women has the potential to unlock up to 5x more potential, if leaders focused on improving their everyday work experience. Promoting DEIB creates a workplace where employees feel psychologically safe, which has positive impacts on productivity, innovation, and attracting and retaining talent. There is also evidence that inclusion and belonging can help remote teams suffering from work from home burnout and stress, which is particularly relevant given that Indeed survey respondents ranked employee mental health and wellbeing as the #1 business priority.

The current state of DEIB

So what do Australian workers think about their employers’ stance on DEIB? Indeed’s survey results show that employees are less positive about efforts to support DEIB than recruitment decision-makers. 42% believe that it is just another buzzword, and 49% think that stereotypes, biases and microaggressions still persist in their workplace. More worryingly, nearly one in four who experienced or witnessed discrimination say their organisation took no action.

Given that employee mental health tops the list of business priorities, it is not surprising that it also tops the list of DEIB causes that organisations are most likely to support (52%). This is followed by gender equality (39%), racial and cultural equality (38%), disability (27%) and LGBTIQA+ equity (27%).

Digging a little deeper, our report showed that 72% of Australian organisations support at least one initiative, while 28% don't advocate for any at all. Only 11% support at least six initiatives and this percentage has declined. The top three barriers preventing DEIB programs being rolled out in the workplace include cost and budget constraints, followed by a lack of awareness of DEIB by leadership, and difficulties measuring success.

So, are organisations merely paying lip service to DEIB? Well, the low percentage of organisations championing multiple causes and the lacklustre support for other initiatives are a strong indication that there isn’t a lot of meaningful action being taken.

Steps to make DEIB a priority in your organisation

The links between DEIB and organisational success can’t be ignored. There is enough research to show that it can set a business up for future financial success, but lack of awareness is preventing companies from harnessing its full potential.

In the current economic climate, it is important not to make short-sighted decisions that could harm the organisation’s competitive advantage in the long run. Taking steps to integrate DEIB into your organisation doesn’t have to be costly or complex. Here are some effective ways to make DEIB a priority in your organisation:

Do a diversity audit

A diversity audit consists of reviewing policies and procedures through a DEIB lens. Ideally, the audit is conducted by an impartial third-party provider and assesses DEIB on a systematic level. An audit is very useful to identify where your organisation stands and where it needs to improve. The findings can also serve as the basis of your DEIB strategy.

Develop a DEIB strategy

Whether you use the audit’s recommendations or hold in-depth discussions with employees, the insights gained can be used to devise a strategy. Define goals, objectives and key metrics to measure progress and establish timelines. Always remember that a strategy can adapt to shifting business priorities. For example, if your organisation implements a hiring freeze, DEIB efforts can turn from talent acquisition to retention and promotion instead. Flexibility in your approach means you can maintain momentum without losing sight of the bigger picture.

Make training available and ongoing for everyone

Getting anything to stick in an organisation is about consistency and repetition. Providing regular online and in-person training can help educate, raise awareness, and shift the cultural mindset towards DEIB. 

Build a culture of open communication

Being transparent about goals and progress is vital. This needs to be communicated at all levels, from senior executives down. It shows that your organisation is committed to driving the DEIB agenda and holds leaders accountable for meeting targets. You can also encourage open communication amongst the workforce by giving employees a safe space to provide feedback and contribute to DEIB initiatives. These kinds of spaces include employee resource groups (ESGs), mentorship programs and regular DEIB-focused team events.

Provide fair and equal access to career opportunities

To ensure a level playing field when it comes to promotions, a good first step is to examine leadership pipelines and whether people identified as future managers are assessed according to equal standards. It is also a good idea to look at attrition rates among underrepresented groups to check for any bias.

Track DEIB progress regularly

The effectiveness of any DEIB program depends on making progress on key metrics. Set up achievable goals with clear timelines and review them at regular intervals. It may be useful to establish a governance body from a diverse cross-section of your workforce to do this. Also, data analysis and employee feedback can help you get a complete understanding of how your organisation is tracking.