Diversity and inclusion (D&I) are increasingly becoming a business priority. In a time of great changes and disruption, business leaders are pressured to keep up by attracting and retaining the best talent, serving their customers better, and increasing their stakeholders’ trust — all of which are benefits that D&I can offer.
Numerous social changes have drawn the attention of business leaders towards D&I. More than ever, the general public is more vocal about social justice issues, engaging in political discussions, and fighting for social change. Popular movements such as Me Too, Pride, and Black Lives Matter — to name a few — were formed to support women, the LGBT+ community, and African-American minorities. With the pervasiveness of social activism, D&I has become a reputational risk that businesses cannot simply ignore.
Business, talent, and societal challenges are among the tremendous forces working together that reshape how leaders run their businesses. Our world grows increasingly complex and polarized by the day, thereby making D&I a key imperative of modern-day business. Those who embrace it are more ready to respond to an ever-changing world and are in the best position to reap the growth opportunities and benefits offered by a diverse and inclusive workforce.
THE BENEFITS OF D&I
There are proven benefits to building a diverse and inclusive workforce. D&I helps businesses address challenges and leverage opportunities around talent, customers, and investors.
1. Attracting and retaining talent
Globally, the war for talent is increasingly competitive. Talent with the right skills is even more difficult to attract and retain. PwC’s 20th Global CEO Survey shows that 77% of CEOs are concerned about the availability of key skills and see it as a threat to their business goals.
In a competitive labor market, employees are increasingly looking for organizations whose values are aligned with theirs. PwC’s 2017 Inclusive Recruitment Survey shows that employers’ attention to D&I is a key consideration of potential talent when looking for work. Some 54% of women and 45% of men surveyed said that they research a company’s D&I policies before deciding to accept a position. This is also true for LGBT+ and millennial talent. Based on PwC’s Out to Succeed Survey, more than 80% agree that policies on diversity, equality, and inclusion are critical factors in deciding to work for a specific employer. Locally, some companies are responding to this by offering benefits for partners of their LGBT+ employees.
It can be reasonably concluded that organizations which do not prioritize D&I are unable to fully maximize the vast talent pool in the market. It also proves that D&I is a powerful brand differentiator that can help businesses become an employer of choice.
Embedding D&I in organizational recruitment, retention, and development policies will help businesses expand their horizons, allowing them to look for the best talent even in the most unexpected places, and to retain them whoever and wherever they are.
2. Closer to customers
There are increased expectations from the public for businesses to mirror the diversity of the society that they serve. Failing to do so hinders organizations from fully understanding and addressing their customers’ evolving needs.
Businesses are starting to acknowledge how a diverse and inclusive workforce allows them to win the trust of different communities, provides opportunities to understand customers better, and enables them to create more targeted products and services. In fact, a 2018 LinkedIn report shows that 49% of surveyed employers are focusing on diversity to better represent customers.
D&I also nurtures customer loyalty. Businesses have started to advocate social change to address the more socially and politically-conscious consumer. Case in point: with the growing spending power of LGBT+ consumers and allies, some organizations have responded by creating more inclusive and LGBT+ friendly marketing campaigns.
3. Enhancing trust
Disclosures on diversity and inclusion are becoming more and more important to shareholders and investors. These stakeholders want to ensure that they are investing in businesses with stable reputations.
An organization’s transparency about D&I, no matter how bad or good its track record is, enhances the trust of stakeholders. To this end, numerous global companies (including tech giants Google and Apple) have started publishing diversity and inclusion reports on their corporate websites.
MOVING FORWARD WITH D&I
To move forward with D&I requires businesses to realize that diversity and inclusion are two different concepts that must go hand in hand.
Diversity brings together individuals of different backgrounds, experiences, culture, and preferences. Inclusion cultivates a workplace environment where individuals can be their true selves, where they feel that they belong and are supported, and where their contributions are valued.
It is not enough to prioritize workforce diversity alone. Businesses must also foster an inclusive culture where people feel welcomed, valued, and accepted for who they are. Neglecting inclusion to prioritize diversity may lead to disappointing effects that can undermine an organization’s D&I efforts.
For organizations that are about to start their D&I journey, embedding D&I in the culture should come first. To make this happen, organizations need a D&I program that will propel culture, behavior, and consequently, processes.
To build a D&I program, organizations must:
1. Understand the facts of today — Initiate a continuous process to understand what is happening in your organization. Gather, analyze, and share data to determine your baseline on D&I and identify improvement opportunities.
2. Develop an inspirational strategy — Create a business-focused vision and strategy for D&I that is action-oriented and widely-communicated.
3. Engage leadership — Engage leadership around an inspirational D&I strategy. Hold leaders accountable for D&I results. Make D&I a sustainable C-suite priority fundamental to the success of the business.
4. Create sustainable movement — Execute D&I strategy across all elements of your business and talent ecosystem. Monitor progress.
A successful D&I program will not happen overnight. For many organizations, there is still a long way to go. Realizing the full benefits of D&I requires a good understanding of an organization’s workforce mix and the ability to align it with business strategy. Nevertheless, the benefits from D&I make the journey worthwhile and acting now will surely result in greater long-term gains.
The views or opinions expressed in this article are solely those of the author and do not necessarily represent those of PricewaterhouseCoopers Consulting Services Philippines Co. Ltd. The content is for general information purposes only, and should not be used as a substitute for specific advice.
Louise Margareth O. Luarca is a senior associate with the Management Consulting practice of PricewaterhouseCoopers Consulting Services Philippines Co. Ltd., a Philippine member firm of the PwC network.
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