Research uncovers shortcomings in corporates’ attempts to improve diversity

Actively listening to employees, followed by action, is the most effective driver of diversity, inclusion, and belonging in the workforce, says Josh Bersin

Questions have been raised over whether traditional diversity and inclusion training methods work within a workplace, following new research from Josh Bersin analysts.

The 50-page report, Elevating Equity: The Real Story of Diversity and Inclusion, found that less than 12% of companies compensate or track how senior leaders achieve their diversity and inclusion goals – raising serious doubts about the approaches used to manage the business and social issue of diversity, equity and inclusion (DEI). 

DEI training – a ubiquitous corporate practice – is among the least impactful of practices when it comes to meaningful business and workforce outcomes, says the study based on more than 800 responses from HR professionals around the world. 

Progress on diversity initiatives

The study, a sharp reminder of how little progress organisations have made in recent years in turning diversity and inclusion promised into action, also revealed that:

  • 76% of companies have no diversity or inclusion goals of any nature.
  • Only 11% of recruiters get evaluated sourcing from underrepresented groups.
  • 75% of companies do not include diversity and inclusion in their leadership development.
  • Only 32% of companies mandate DEI training for employees, and only a third offer such training to managers.
  • Only 22% of respondents believe their organisations’ DEI efforts have raised awareness among employees, customers, or suppliers.

Overall, HR professionals are not well trained to support diversity, equity and inclusion initiatives and managerial issues. When looking at their capabilities, a separate piece of research involving more than 3,000 HR professionals showed that out of 20 capability areas assessed, diversity, equity and inclusion scored the poorest. A mere 3% of respondents claim deep expertise in this area, while 80% of HR professionals assess themselves as “beginners.”

Top tip

Bersin says that while there are five essential strategies for achieving meaningful equity, listening to employees and taking action on input is the top driver of success. Organisations that have put into place such listening and action strategies are: 

  • 3.6 times more likely to innovate effectively.
  • 6.6 times more likely to adapt to change.
  • 8.4 times more likely to inspire a sense of belonging.
  • 8.5 times more likely to satisfy and retain customers, and
  • 12 times more likely to engage and retain employees.

C-suite commitment

Organisations that have achieved meaningful diversity, equity and inclusion outcomes are 4.3 times more likely to have a CEO who articulates the company’s DEI vision and transparently communicates progress; 9.4 times more likely to have a CEO who holds senior leaders accountable for DEI results, and 10 times more likely to have a DEI strategy that is an integral component of the company’s business strategy.  

A key takeaway from the research is the importance of focusing on inclusion and belonging, making diversity sustainable. A company can force workforce diversity in terms of race, ethnicity, or gender, but still, have a culture in which minority employees feel disenfranchised. 

Technology solutions can help companies monitor feelings of inclusion among employees in a variety of different ways – ranging from targeted pulse surveys to network analysis.  

The study also found that a “hiring-only” approach to addressing DEI issues is not effective as minority candidates will leave an organisation if they feel excluded or underrepresented in senior management and leadership roles.

Equally, inclusive process design must be built into all performance evaluations, rewards and pay, development opportunities, and talent acquisition aspects.

The study also emphasizes the importance of DEI-related metrics and goals. To drive DEI success, companies need to have teams skilled in people analytics, invest in analytic technologies and external benchmarking, and commit to transparency in reporting progress – or lack thereof.   

Josh Bersin, a global industry analyst, said: “Diversity, equity and inclusion is a hotly discussed topic and clearly essential to business success. However, there are no clear guidelines on how to effect lasting, meaningful change.

“The entire domain is highly complex, and many companies turn to legacy tactics of unconscious bias training, diverse recruiting and other directives that can backfire and even contribute to more division than unity. It’s time for CEOs and CHROs to define their businesses in diverse, fair, and inclusive ways.”

Kathi Enderes, PhD, vice president of research, said: “Across industries, geographies and organizational sizes, the most successful organizations are listening to their employees, and hear and act accordingly. They also have strong, highly capable HR people to consult on DEI with leaders at all levels. These companies also have set clear, measurable goals that go beyond diversity representation and instil accountability across all levels.”

The complementary study, Elevating Equity: The Real Story of Diversity and Inclusion, is available for download here. Separately, a new training program, Elevating Equity, has just been released in the Josh Bersin Academy. HR professionals and business leaders can register for the program here.
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