The Business Case for Diversity & Inclusion

In the day-to-day work of promoting equity, diversity and inclusion, it can be easy to lose sight of the "why." In addition to it being the right thing to do, the research below demonstrates that diversity & inclusion drive business results, and that we still have a ways to go in order to achieve these just and profitable outcomes.

The case for diversity and inclusion is clear:

— Diverse companies are higher performing. Companies with ethnically diverse leadership teams are 36% more profitable that those with the least diverse leadership teams (McKinsey & Company, Diversity Wins: How Inclusion Matters, 2020).

— Diverse, inclusive companies attract talent - and vice versa: 39% of respondents in a McKinsey study reported that they turned down or chose not to pursue a job because of a perceived lack of inclusion (Understanding Barriers to a More Inclusive Workplace, 2020).

— Inclusion fuels employee engagement - almost three-quarters of individuals who say they feel very included say they are entirely engaged vs. just one-quarter of those who do not feel very included. (McKinsey & Company, Understanding Barriers to a More Inclusive Workplace, 2020)

— Companies with inclusive cultures are higher performing - they are two times as likely to meet or exceed financial targets, three times as likely to be high-performing, six times more likely to be innovative and agile, and eight times more likely to achieve better business outcomes. (Juliet Bourke, Which Two Heads Are Better Than One? How Diverse Teams Create Breakthrough ideas and Make Smarter Decisions, 2016)

Even though the business case is clear, we still have a ways to go to achieve equity, equality, diversity and inclusion in the workplace.

Looking across U.S. corporations:

— Diversity in corporate leadership is low: Only 5% of executives are Black and Hispanic, even though 31% of the US population are Black and Hispanic. (Mercer, The Time is Now: Addressing Diversity, Equity and Inclusion in the Workplace, 2020)

— Minorities in corporations do not advance at the same rate as their white colleagues, resulting in lower diversity with every step of the corporate ladder: At the support staff and operations level, 64% of employees are white, and 22% of employees are Black or Hispanic. At the professional level, By the executive level, 85% are white, and only 2% are Black, 3% are Hispanic. (Mercer, The Time is Now: Addressing Diversity, Equity and Inclusion in the Workplace, 2020) Keep in mind that in the United States,

— Diverse talent face heavier headwinds in corporations than other groups. These headwinds include microaggressions, a disproportionate assignment of high-risk projects, being judged on performance rather than potential, unjust assumptions, higher expectations than the norm, and social exclusion. (The Executive Leadership Council, The Black P&L Leader, 2019).

The above research points to the importance of work being done to increase equity, equality, diversity and inclusion in the workplace.