WHY DIVERSITY AND INCLUSION IN THE WORKPLACE MATTER MORE THAN EVER

“The business case for gender and ethnic diversity in top teams is stronger than ever.”?– Deloitte

Studies show people highly value diversity and inclusion in the workplace.

67% of?job seekers?consider workplace diversity when evaluating a job, and 75% of senior managers say they’d consider?jumping ship?to a more diverse and inclusive organisation. (1)

“In fact, most care enough about it so much that they’re willing to sacrifice a higher salary to consider working at a more inclusive company,” writes Maggie Overfelt in a 2022 article for Stanford Graduate School of Business. (2)

Organisations are being?scrutinised?closely. But if we know diversity, equity, and inclusion (DEI) are so important – why are there still companies who don’t prioritise it?

In this?International Women’s Day (IWD)?week we look at what our speakers say about DEI – and offer their expert tips for us all to do better.

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What is Diversity and Inclusion?

Before we continue, it’s worth recapping the definitions of diversity, inclusion, and equity.

• Diversity?has been defined as the “range of human differences”, including such things as ethnicity, gender, gender identity, sexual orientation, age, physical ability, and religion.
• Inclusion?has been defined as “involvement and empowerment”, where everyone?feels belonging , has support, and is respected.
• Equity?refers to equal access, resources, and opportunities. (3)

In essence, diversity and inclusion mean bringing your whole self to work – and feeling safe and supported once there. Conversely, a non-inclusive workplace is terrible for employee wellbeing.???

As New York based inclusivity expert Jennifer Brown?told Growth Faculty’s?IWD event in 2022 , “covering” or?playing down your identity?to manage others’ reactions can be exhausting.

It can lead to burnout, create a?toxic workplace , and indicate a culture where?psychological safety ?is lacking.?

4 Reasons Why Diversity & Inclusion is Essential in the Workplace?

Perhaps the shared global experience of COVID-19 has heightened people’s sensitivity to their employers’ commitment to diversity and inclusion.

One of the Stanford?study ’s authors Jung Ho Choi said of his own job search:

“I wondered?[about a major accounting firm], ‘What’s the culture like? How diverse is it? Are diverse opinions valued?”

Put simply, he was searching for evidence of?inclusion and belonging ?at that workplace, and a?positive workplace culture ?(or warning signs of?a dysfunctional one ).

Knowing diverse team members are welcomed and treated with respect and care is a good basis for gaining an employees’?trust,?loyalty, and?dedication.?

It’s also great for widening the talent pool, making better decisions, setting employees up to thrive, and improving its chance of success. Let’s look briefly at each.

It Broadens The Talent Pool

Good to Great?author Jim Collins famously talks about the importance of people decisions.

“Those who build great organisations make sure they have the right people on the bus, the wrong people off the bus, and the right people in the key seats before they figure out where to drive the bus.

"They always think first about “who” and then about what.”

Who we recruit, evaluate, promote, and retain will depend on?who is in our talent pool?in the first place. Drawing from a pool that includes everyone can help the bottom line.

As McKinsey & Company’s 2020 paper?Diversity Wins: How inclusion matters?says, “The most diverse companies are now more likely than ever to outperform non-diverse companies on profitability.”

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It Strengthens Decision Making?

There’s a great analogy for why a diverse team makes better decisions in?our interview ?with Shane Snow, author of?Dream Teams.

Shane says any problem can be represented by a?mountain range?– each peak is a good, better or best solution.

But trying to choose the best solution is like hiking through fog. You may not be able to see everything.

A team that has people with different, even?REALLY different, perspectives and approaches to problems is like having them?dropped off by helicopter?on a different part of the mountain.

In other words, a diverse team sees more of the mountain!?

Growth Faculty Pass holders can watch the?interview replay ?in the On Demand portal.

And read our blog?HOW DIVERSITY HELPS BETTER DECISION MAKING: DR STEFANIE JOHNSON

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It Sets Employees Up to Thrive

An inclusive environment is one where employees can not just turn up and work but thrive.

That’s because, to a large extent, the culture is?built on empathy.

Dr Kirstin Ferguson, author of Head & Heart, says that with better understanding of what it is like for others, we can be better leaders.

Better leaders (with?“Multiplier traits” ) encourage, coach, believe in, grow, trust, and assume the best of their employees. It’s like fertiliser for staff – if we are noticed, supported, acknowledged and valued at work, we are much more likely to give our best.

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It Fosters Better Organisational Performance

McKinsey & Company research shows companies in the top quartile of gender diversity on executive teams were?25% more likely?to experience above-average profitability than peer companies in the fourth quartile. (4)

“We found the higher the representation, the higher the likelihood of outperformance.”

McKinsey discovered companies with more than?30% women?on their executive teams were significantly more likely to outperform those with between 10 and 30 percent women.

“There is a substantial performance differential—48% —between the most and least gender-diverse companies.”

What are the Challenges of Diversity & Inclusion???

Like anything worth pursuing, there are challenges around diversity and inclusion.

Given bias and stereotypes can be sprinkled throughout organisations, it can be?hard to pinpoint?who is responsible for tackling the problem (more on that in a moment). Aspects of DEI can be hard to measure.

It relies on self-aware leaders who have empathy at their core.?

Organisational Silos??

Working in a “silo” cuts team members off from working collaboratively with colleagues who think differently.

Psychological safety expert Amy Edmondson and colleagues Sujin Jang and Tiziana Casciaro wrote about the need for?cross-silo?leadership in 2019 in Harvard Business Review. (5)

Their research shows that diverse teams containing a?“cultural broker”?outperformed diverse teams without one. A cultural broker is a go-between who can link diverse groups.

They also recommend encouraging lots of questions, being a role model in taking an interest in others, hiring for curiosity and empathy, and coaching people to consider others’ points of view.

It Can Be Difficult to Measure?

How do you measure if someone feels included? Or feels a sense of belonging? You can set targets and measure diversity in representation but it’s?trickier?to keep tabs on equity and inclusion.

Given the measurements here are largely qualitative, leaders need to be curious, observe carefully, ask questions, look at their processes, role model inclusive behaviours, and invest in their own professional development.

Associations Now recommends focussing on?retention rates, using specific questions in?surveys?(“Do you feel like you have a safe space to speak up in meetings, to your boss, and to your colleagues?”) and?defining goals?using benchmarking data. (6)

Leaders Must Champion Change?

Without a leader who proactively champions DEI, progress will stall.

Inclusivity expert Jennifer Brown recommends leaders work through the Inclusive Leader Continuum:

Phase 1:?Unaware?- You think diversity is someone else’s job.

Phase 2:?Aware?– You educate yourself on how best to move forward.

Phase 3: Active?-You shift your priorities and take action to support others.

Phase 4: Advocate?– You are proactively and consistently using your privilege to the advantage of others. You consider their issues your issues and stand in solidarity with them.?

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How to Strengthen Diversity & Inclusion in the Workplace

We’ve already talked about ways to bolster diversity and inclusion at work. Given its importance, here are some more ideas from our expert speakers and authors.

Create a Psychologically Safe Workplace?

Kylie Lewis’s?masterclass on psychological safety ?in the workplace will include practical advice to establish such a workplace.

To understand what it looks like, she points us to Timothy Clark’s?Four Stages of Psychological Safety.

The 4 Stages of Psychological Safety?

1. Inclusion Safety:?I am worthy, I belong, and I feel safe to be here.?
2. Learner Safety:?I’m growing, it’s safe for me to be a learner, I can ask questions and I can show up and not have all the answers.?
3. Contributor Safety:?I am making a difference somewhere where it’s safe to contribute my ideas, vision, hopes and dreams.?
4. Challenge Safety:?Here it safe for me to challenge the status quo and help to fix what’s not working.?

Implement D&I Measurement Tools?

Given there is no standard way to measure diversity and inclusion, organisations must decide what is best practice for them.

The key is to start somewhere; as Peter Drucker says, is?“What’s measured, gets done.”

Include-Empower.com says?representation, retention, recruitment, selection, promotion, development, pay and benefits, employee engagement, employee focus groups,?and?exit interviews?are some metrics that a company could track. (7)

It gives the examples of:

·???????A media distribution company with aggressive growth targets in Asia extending its diversity metrics to include individuals born or raised in Asia.

·???????A mining company seeking to improve retention of women by implementing a flexible work policy extends its diversity metrics to track employment and parental status.

Recognise & Reward Employees?

Acknowledgement is recognising something?exists?or is?important. It’s a pillar of diversity of inclusion.

Kylee Stone, in her?masterclass on purposeful leadership ?for Growth Faculty, says there are two parts to acknowledging:

·???????Truth-telling:?This is acknowledging others, acknowledging yourself and acknowledging ‘what is so’. What do we mean by that? It means noticing, hearing, and appreciating others, being kind to yourself, and acknowledging setbacks and challenges.

·???????Gratitude:?Giving gratitude is simple but is often overlooked as a way to inspire people. You don’t need to start big. Just show people they are appreciated.

Update your D&I Policy

Don’t write your D&I Policy then file it away. Ensure policies are?up to date?and reflect the latest?best practice?standards.

Make sure the company clearly communicates the behavioural standards expected of all employees and leaders.?Publishing your D&I Policy engenders trust amongst your stakeholders.

To see a sample of one such policy, look at?CPA Australia’s Inclusion and Diversity Policy .

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Take the Harvard University Biases Test

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“The same thought processes that make people smart can also make them biased.”?– Payne et al, 2018

20 million people have taken Harvard University’s online test to see if they have “implicit bias” tendencies.

Project Implicit? ?shows that about?75% of people?have some unconscious bias associating men with work and career and women with home and family.

“If this is the case, it becomes very hard to take women seriously in the workplace,” says Sarah Kaplan in her book ‘The 360 Degree Corporation’.

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Building a diverse and inclusive workplace?requires upskilling?in areas such as empathy, self-awareness, inclusivity, psychological safety, trust, team-building, communication, unlearning, and adaptability.

These skills and more are among core topics included in our Growth Faculty Leadership Pass.

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References:

1.?????Rebekkah Smith,?11 Eye-Opening Workplace Diversity Statistics in 2023, NorthOne

2.?????Maggie Overfelt, 2022,?Hey, Employers: Job Hunters Really Want to See Your Diversity Data

3.?????Adapted from?Diversity and Inclusion Definitions, Ferris State University website

4.?????Diversity Wins: How inclusion matters, 2020, McKinsey & Company

5.?????Edmondson, Jang, Casciaro, 2019,?Cross-Silo Leadership, Harvard Business Review

6.?????Michael Hickey, 2020,?Four Ways to Meaningfully Measure Your DEI Efforts, Associations Now website

7.?????Felicity Menzies,?Meaningful Metrics for Diversity and Inclusion, Include-Empower.com