What are we supposed to do with DEI?

In the realm of uncomfortable questions, here’s one that executives have been asking each other (and their lawyers) lately: What are we supposed to do with our DEI programs?

The question is not unfounded.

Over the past 2 years, a range of high-profile supreme court cases, lawsuits, and state regulations have been challenging many existing DEI-related initiatives and prompted many to question the future (and present) of DEI in our public and private institutions.

If, 3 years ago, DEI was a no-brainer – an investment that would win over talent, attract clients, boost employer branding, and make the world a slightly better place – execs are now having to face what feels like a potentially mounting range of legal and financial risks.

The question behind the question that has emerged is this: Is DEI a business driver or a liability? ?

Right now, for most execs, the answer doesn’t feel clear.

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What’s everyone else doing?

Naturally, one of the first places leaders (and legal teams) turn in uncertain times is their peers; they peek around the corner and ask, “what is everyone else doing?”

This isn’t a terrible thing. Having spent a good chunk of my career in the consumer goods world, I’m a big fan of market research.

But the current landscape of reactions, which is a delightfully mixed bag, may only add to the confusion. These reactions tend to fall into one of four categories:

1. Pulling Back: The headlines have announced a range of companies, like Zoom , Meta , and Microsoft , publicly scaling back their in-house DEI teams, in some cases opting to outsource to consultants.
2. Doubling Down: At the same time, other giants like JPMorgan Chase and Delta are publicly reaffirming their DEI commitments in the face of pushback.
3. Rebranding: Others, most notably the Human Resources giant, SHRM, are rebranding DEI efforts to focus on broader culture initiatives and removing or re-ordering the terms that have attracted the most opposition, namely the “D” (diversity) and the “E” (equity).
4. Pausing: The last group is taking a “wait-and-see” approach, wading through confusion with their legal teams, HR, and ESG leads, and pausing until the supposed storm has passed (or at least until the path forward feels a little clearer).

It’s this fourth group that I believe makes up the largest share of companies.

Leaders in these groups are unsure how to proceed and, lacking support and concrete guidance on how to move forward, feel the risk of making any move is greater than the reward.

But while this may feel like the safest option, there is actually a great deal more risk in this approach than most leaders realize.

The risks of inaction

Here’s the thing: inaction speaks louder than words.

Consider these facts:

• Talent is diversifying: Gen Z is the most racially and gender diverse generation of employees the US workplace has ever seen, with nearly 50% identifying as non-white.
• Younger workers demand DEI commitments: 49% of Gen Z and Millennials choose employers based on DEI values (Deloitte), and 73% of Gen Z applicants prioritize DEI programs when job hunting (EY Belonging Barometer).
• Drop DEI, lose talent: ?40% of employees would consider leaving if DEI commitments falter (SHRM 2023).

The point of these statistics is clear: legislation and terminology may change, but the demand and expectations for DEI efforts from the workforce is unwavering. Au contraire, it’s due to rise: Gen Z and Millennials, who care most about their employers’ commitment to DEI, will make up 70% of the nation’s workforce within the next 5 years. This is a big deal.

So, if you think just 5 years ahead, what (in)action you take today around DEI will have a huge impact on your ability to attract and retain the talent you need to grow.

So how do you move forward, safely?

So how does a company move forward when it seems like one direction may compromise your legal status and the other will surely cost you talent and business?

My answer: thoughtfully and transparently.

With the companies I’ve been advising, which comprise a range of industries and sizes, we look at 4 things:

1. Core culture mission – putting all the labels aside, what is it that you want for your culture and your people? What are the core values that you want your people to feel every time they step into the office, virtual or physical?
2. Words & labels – Now that the core mission is clear, do the words and terms we are currently using to describe our efforts truly represent that mission? Do we have clarity and conviction to stand behind each and every one of those words? If not, let’s rethink.
3. Demonstrating - how are we actually showing those convictions? ?What are the concrete efforts we’re making to weave those values into our everyday? And are those efforts impactful?
4. Communicating – how are we communicating our commitments to our people (internal) and to our stakeholders (external)? How are we regularly showing our commitment and holding ourselves accountable to outcomes?

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Rather than a threat and a reason to pause, the current confusion around DEI is the perfect opportunity to stop and reflect on what your truest goals are and to communicate those values to your people.

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Some parting advice

For those who remain confused, here are a few steps forward I recommend:

• Ask your people – gather feedback from your people, preferably through an anonymous survey, how they feel about the current DEI efforts and what they’d like to see moving forward. This is an excellent compass to inspire your path forward, and let your people know you’re thinking about this.
• Get outside help
• Be open and transparent with your employees about how you’re approaching this. Communicate the questions you’re posing and the work you’re doing to wade through the confusion.

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Remember: inaction speaks louder than words, and this moment of confusion and uncertainty is an incredible opportunity to stand out and stand up as a leader both in your organization and in your industry.

As I always say: great leaders go there; will you?

Want help?

If you’d like support navigating the current confusion, and getting clear on what your culture strategy can and should be moving forward, I’m offering advisory specifically for this moment to companies who need it. My goal is to help as many leaders as possible shift from uncertainty to action. For more information, visit www.melinacordero.com/dei or get a teaser with the brief video at the top of the page.

About Me

Melina Cordero is the Founder & President of P20 Workplace , a firm that delivers digital leadership development and DEI solutions built for the post-2020 workplace. Read the story of how she leapt from commercial real estate executive to DEI innovator, explore her services , and connect with her on?LinkedIn, where she shares the latest data, research, and ideas on the evolving world of work.

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