The Value of Diversity, Equity, and Inclusion In The Workplace
In today’s business world, Diversity, Equity, and Inclusion (DEI) are often treated as buzzwords that often amount to little more than a mandatory annual training. But the reality is, when you make DEI a priority, every facet of your organization benefits, including the bottom line.
While there isn’t a one-size-fits-all rule book for rolling out a successful DEI program to your company, you can begin your journey by learning what DEI truly is and understanding the value it can bring to your company.
What is Diversity, Equity, and Inclusion?
• Diversity is the presence of differences within a given setting. In the workplace, this generally refers to psychological, physical, and social differences that occur among any and all individuals. A diverse group, community, or organization is one in which a variety of social and cultural characteristics exist.
• Equity ensures everyone has access to the same treatment, opportunities, and advancement. Equity aims to identify and eliminate barriers that prevent the full participation of some groups.
Barriers can come in many forms, but a prime example can be found in this study. In it, researchers asked faculty scientists to evaluate a candidate’s application materials, which were randomly assigned either a male or female name. Faculty scientists rated the male applicant as significantly more competent and hireable than the identical female applicant, and offered a higher starting salary and more career mentoring to the male applicant.
• Inclusion refers to how people with different social identities feel as part of the larger group. Inclusion doesn’t naturally result from diversity, and in reality, you can have a diverse team of talent but that doesn’t mean that everyone feels a sense of belonging, or feels welcome or valued in all work environments.
Diversity, Equity, and Inclusion are mutually reinforcing principles within an organization. A focus on diversity alone is insufficient because an employee’s sense of belonging (inclusion) and experience of fairness (equity) is critically important in ensuring an equitable and inclusive workplace.
The importance of diversity, equity, and inclusion in organizations
Organizations that don’t implement DEI practices miss out on opportunities to tap into their peoples’ potential. “Diverse teams are more innovative and make better decisions, and diverse companies have better shareholder returns,” according to the study Unrealized Impact.
Another study conducted by McKinsey & Company in partnership with The Society for Human Research Management (SHRM), evaluated the performance of companies with different levels of workplace diversity. They found that companies that exhibit gender and ethnic diversity are, respectively, 15% and 35% more likely to outperform less diverse peers. The same study found that organizations with more racial and gender diversity bring in more sales revenue, more customers and higher profits.”
Companies that value DEI are stronger than those that don’t
DEI programs are an essential aspect of building engaged and happy employees. Organizations with strong DEI initiatives are more likely to have employees with increased job satisfaction, higher levels of trust, and are more engaged. But it’s not just morale that lifts when DEI programs are made a priority, there are benefits that can be seen at every level of the business.
Teams are 158% more likely to understand target customers when they have at least one member who represents their target’s gender, race, age, sexual orientation, or culture.
Companies with higher diversity in management earned, on average, 38% more revenue than companies with lower diversity. That could be because diversity of gender, country of origin, career path, and industry background are highly correlated to innovation.
Organizations in the top 25% when it comes to gender diversity among executive leadership teams are 21% more likely to be profitable and 27% better at creating value.
Simply put, reinforcing robust DEI programs helps every employee to show up each day without fear of being their true selves. This fosters higher degrees of engagement, productivity, and innovation that contribute to increased revenue.
Sydney Ly oversees Employee Experience and Culture at 15Five, continuous performance management software that includes weekly check-ins, OKR tracking, peer recognition, 1-on-1s, and 360° reviews. Sydney lives in San Francisco with her cat, Four Fanged Fred, and is always looking for the best middle of nowhere place to escape to.