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5 DEI Best Practices: What You Need to Know About Diversity, Equity, and Inclusion in 2023

December 29, 2022

DEI Best Practices

If you’ve heard more about diversity, equity, and inclusion (DEI) over the past few years you’re not alone. Although DEI has been around for a while, it’s an area of business that’s been steadily gaining attention more recently. As movements like Black Lives Matter, Me Too, and Stop Asian Hate have become fixtures within society, so too has become a call for diversity, equity, and inclusion.

This demand for progress has led to a 123% increase in DEI-related job postings between May and September of 2020 alone. Not to mention the rapid expansion of already-established corporate DEI programs.

And while companies are oftentimes well intended with their DEI efforts and genuinely strive for diversity, equity, and inclusion, there are still many organizations that miss the mark. Whether due to a lack of education or from utilizing the wrong resources, there are plenty of reasons why companies fall short in DEI.

If your company is looking to create or improve their DEI program, we’ve researched 5 DEI best practices to help you get started.

 

What is DEI?

As mentioned, DEI stands for diversity, equity, and inclusion. It’s a conceptual framework that strives for more fairness and empowerment for individuals who have typically been underrepresented or subject to discrimination in the workplace.

Different variations of DEI now also exist, such as:

  • D&I – Diversity and inclusion
  • DIB – Diversity, inclusion, and belonging
  • DEB – Diversity, equity, and belonging

While similar, each does in fact have a unique emphasis.

Diversity: Acknowledges all the ways people differ, including: race, sex, gender, age, sexual orientation, disability, religious beliefs, socioeconomic status, and more.

Inclusion: Is about ensuring all diverse groups in a workplace feel welcome, supported, respected, and valued.

Equity: Not to be confused with equality. Where equality ensures each person or group receives the same opportunities regardless of circumstance, equity aims to allocate resources based on need. The goal is to offset any imbalances that may already exist.

Belonging: Belonging happens when people, no matter their differences, feel safe and welcome. Belonging typically occurs when diversity, equity, and inclusion are successfully achieved.

DEI Best Practices

The History of DEI

It’s important to understand DEI’s history to fully understand its significance in today’s workplace. While sometimes criticized as just a trend, DEI actually has its roots in the mid-1960s, following the introduction of equal employment laws and affirmative action.

At the time, companies weren’t used to having integrated offices and so to help smooth the transition, diversity training became more common. However, although common, these trainings tended to be ineffective for generating lasting change.

Because these programs oftentimes were set up as lectures and workshops that resulted in a list of “do’s and don’ts,” these programs were at times seen as controlling. Unfortunately, this led some programs to be met with resistance – especially amongst groups who already held power, like white men. In fact, a Harvard study found that white male employees still tend to be particularly unaffected by diversity training.

This isn’t to say that DEI doesn’t work. More so that the methods used in the past aren’t as effective as they could be. And if your company is struggling to generate significant change with your DEI program, it may be time to update your methods.

 

Why Invest in DEI

There’s no denying that diversity, equity, and inclusion programs aren’t an easy feat to implement well. And when done wrong, companies can even risk negative backlash. So, why should organizations invest in DEI in the first place?

There are several reasons why a company should invest in DEI programs.

 

Better Business Outcomes

Arguably the most objective case for DEI is its correlation with improved business performance. Countless studies over the years have linked more diverse companies with better business outcomes, and the trend doesn’t seem to be letting up.

For example, a 2019 analysis from McKinsey found that companies in the top quartile for gender diversity on executive teams were 25% more likely to have above-average profitability than companies in the fourth quartile.

Furthermore, this study also found that the greater the representation, the higher the likelihood of outperformance. In short, the most gender diverse companies were 48% more likely to outperform the least gender diverse companies.

Another study by McKinsey found that companies with racial and ethnic diversity are 36% more likely to outperform their peers.

 

Higher Employee Retention

A 2021 study by Momentive found that 62% of employees feel that DEI initiatives are an important factor for their company’s ability to drive success. Furthermore, this study found that 78% of people feel that it’s important for them to work for an organization that prioritizes diversity and inclusion, with 58% saying it’s “very important.”

Additionally, this study also found a correlation between job satisfaction and employees’ perception of whether their company is doing enough DEI initiatives. Workers who said their company wasn’t doing enough for DEI scored a 63 in overall work happiness, compared to 75 for employees who said their company was doing enough or too much for DEI.

In fact, people who felt their company wasn’t doing enough DEI scored lower on all areas of job satisfaction. These scores differed particularly drastically in areas of pay and career advancement. 60% of people who said their company isn’t doing enough DEI said they were paid well, compared to 80% and 82% for employees who felt their company was doing enough or too much DEI, respectively.

It should come as no surprise, then, that employees who feel well paid and have career advancement opportunities are less keen on job hopping. Not to mention the positive impact on engagement and morale when employees feel safe, respected, and like they belong.

 

More Innovation

When a company has a diverse culture, it lays the foundation for more innovative problem solving. Contrasting ideas can flow more easily, stimulating innovation and also helping foresee problems down the line.

From a marketing standpoint, a more diverse team is better equipped to reach a more diverse audience. And a wider audience means a bigger opportunity for sales. This ability to easily innovate and reach people helps give companies a competitive edge.

 

DEI Best Practices

Demonstrates Authentic Company Values

It’s undeniable that some people won’t see the value in DEI and some may even be actively against efforts for diversity. But companies will need to decide for themselves which values they choose to uphold. If your organization has any kind of corporate value around community, belonging, inclusion, collaboration, etc. DEI efforts will likely be needed to truly uphold those values.

In fact, as our social environment continues towards progress, companies now risk being perceived as hypocritical, deceptive, or out of touch if their values don’t match their actions. Luckily, striving for diversity, equity, and inclusiveness will always be strong values that not only benefit your bottom line, they benefit your people too.

 

DEI Best Practices

Now that you know what DEI is, where it came from, and why it’s important, we can discuss how to get started. Although DEI is a long-term commitment, it’s worthwhile when done right. Below is our list of DEI best practices to help improve the employee experience at your company.

 

1. Evaluate your environment

First, it’s important to identify what problems your organization is facing or which areas you’d like to improve.

One common pitfall is focusing solely on recruitment. While recruiting from a more diverse candidate pool is great, you risk losing your new hire if your culture isn't built for DEI. Focusing first on company culture and daily office life may help lay the groundwork for significant, lasting change.

Try sending anonymous surveys to employees to gauge sentiment on certain issues and areas. Then, combine this data with HR data on representation, employee turnover, career progression, etc. You should be able to get a feel for some trends from this information alone.

 

RELATED: What is an Employee Engagement Survey? And Why Should You Care?

2. Form a DEI committee

Depending on your available resources, this might involve hiring specialists dedicated to improving your company’s DEI initiatives. But this can also look like employees who have an interest in DEI working together on a committee.

The committee itself should be made up of a diverse group of people ranging in age, sex, race, culture, etc. This group should be responsible for helping generate DEI goals, as well as helping facilitate action.

Remember though, change cannot rely on this group alone. It will require a company-wide effort for significant, lasting progress to occur.

 

3. Establish goals (and share them!)

Using the feedback you receive from your surveys, establish SMART goals. SMART, meaning specific, measurable, attainable, relevant, and timely.

Depending on your survey responses, SMART goals for DEI could include:

  • Strive for equal pay/ending any gender pay gap
  • Recognize a wider range of holidays/festivals
  • Establish a zero-tolerance policy for discrimination, prejudice, sexism, etc.
  • Build mental health days into a PTO policy
  • Hire/promote people from more diverse backgrounds

Whatever your goal(s) end up being, make a clear plan for how you’ll achieve them and be sure to communicate these efforts to your team. It’s important that your goals aren’t worked on only behind the scenes – your employees will be directly affected by these changes so it’s important they feel heard, seen, and understood.

 

4. Get leadership buy-in

As with most initiatives, true change only comes when company leaders embrace the effort. This means C-suite, execs, and managers will need to not only speak openly about DEI efforts but will also need to lead by example. In fact, research found that 60% of employees want to hear business leaders speak up more about social and political issues.

This means not just announcing that mental health days are available, but actually taking them yourself. It means not just saying you now have Juneteenth off but taking a moment to educate why the day is significant. And it’s not just saying you have a zero-tolerance policy, it’s speaking up when you see discrimination occurring.

Encouraging employees to do these things is good, but showing your team that you’re striving for change too is even better.

5. Celebrate wins, address losses

Implementing real change will inevitably come with some growing pains. But don’t be tempted to bury them under the rug or shy away from talking about them.

For example, maybe one of your goals was to take a more active role in monthly observations. Maybe you had great initiatives around Black History Month, but for some reason didn’t end up doing anything to celebrate Pride month. These things happen. But rather than letting the issue pass by, address it.

Choose a company-wide meeting where you can take a few minutes to discuss your DEI efforts. In the meeting, acknowledge that you missed the mark, apologize, and let people know what you plan to do differently in the future. By not shying away from the problem, you’re showing a true commitment towards progress.

Conversely, don’t forget to celebrate wins. In the example above, while it’s appropriate to discuss where you fell short, it’s also important to highlight how well you did with Black History Month. Remind your employees that although you’ve stumbled, you’re still heading in the right direction.

 

6. Circle back

Lastly, remember to follow up with your employees once your DEI initiatives have begun. This will serve as a barometer for how closely your initiatives are aligning with what’s important to your employees.

Even if leaders think they’re hitting the mark, it’s possible to still be a bit off. For example, a 2020 study by Accenture found that 68% of leaders felt they brought an empowering and inclusive environment to the company. However, only 36% of employees agreed.

Without following up with your employees, discrepancies like this could exist without leaders ever knowing. Brewing under the surface, companies may face increased turnover, low engagement, and low morale without understanding the root cause.

 

Going Forward

In today's environment, working towards improving DEI is not only good business sense, but it demonstrates authenticity in company values and shows employees they're valued.

While improving diversity, equity, and inclusion at your company may not be a quick fix, when done well, the effort is worth the results. Your team will begin to feel safe, seen, and a sense of belonging at work. This can help contribute to reduced turnover, increased engagement, and improved morale. All of which not only benefit your company, but your employees as well.

 

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