Studies show diversity can aid businesses
Diversity, equity and inclusion no longer are just admirable social goals for businesses.
Now there's evidence that having a wide range of backgrounds in a company's workforce can boost a company's bottom line and help it avoid embarrassing public relations blunders, Sonal Shah, senior employment counsel at HR Source in Downers Grove, said during Thursday's Daily Herald Business Ledger webinar, "Diversity, Equity & Inclusion: How to initiate change in the workplace."
A McKinsey and Company study shows employers with more diverse workforces outperform others, Shah said. The most diverse organizations are 35% more likely to have financial returns above the national industry average.
Companies in the top quartile for gender diversity on their executive teams outperform others by 21%, and ethnic and cultural diversity indicates a 33% likelihood of outperformance, Shah said of the McKinsey study. A DeLoitte study showed companies with inclusive cultures are "two times as likely to meet or exceed their financial targets, three times more likely to be high performing, six times more likely to be agile and innovative and eight times more likely to achieve better business outcomes," Shah said.
Shah defined diversity, equity and inclusion as encompassing a wide range of backgrounds, including gender, age, religion, race, ethnicity, cultural background, sexual orientation, language abilities and education, whether it relates to hiring, pay or promotions.
"It is likely one of the best things you can do for your organization to be more successful while at the same time righting the wrongs of our collective past," Shah said. "So I really don't see a downside, and how often can we say that?"
"There are clearly major reasons that organizations need to do more than just give this topic lip service," added HR Source president and CEO Mary Lynn Fayoumi.
And there is evidence that young workers are actively looking for companies that promote diversity, equity and inclusion.
"This is a generational shift in the belief that these values are really important and foundational to their experiences as workers," Alvin Tillery Jr., director of the Center for Diversity and Democracy at Northwestern University, told The Washington Post. "You can say there's no systemic racism, but millennials and Gen Z don't believe that. If you're under 35, you expect these conversations, and if you don't offer them, you'll have trouble recruiting."