Diversity-Inclusion: The Business Case

Some organizations pay little more than lip service to diversity and inclusiveness and, as such, they are destined to remain behind the curve. For progressive organizations seeking financial soundness and solid growth, diversity is a vital part of their commercial decision-making and strategic planning. Success is measured by the Chief Executive/Leadership team's understanding and commitment to integrating diversity into all aspects of their corporation's business. Today, it is widely recognized that diversity occupies an increasingly prominent place in corporate America's business agenda and is on every CEO's priority list.

What Is Meant By Diversity?

For Bridge Partners, diversity-inclusion in the workplace is a commitment to recognizing, appreciating and retaining the variety of characteristics that make individuals unique in an atmosphere that champions individual and collective achievement. Examples of these characteristics include: age; culture; ethnicity; gender; geographic background; language(s) spoken; race; and sexual orientation.

Some of the Facts:

  • Census 2000 has proven that the complexion of the United States is changing. It is estimated that, within ten years, nearly 40% of the US population will be made up of African American, Hispanic, Asian and Native American people. Nevertheless, people of color still account for less than 1% of all US boards of directors.
  • Equally, although women constitute close to half of the US workforce, they are still under-represented at senior management level, making up only 15.7% of Fortune 500 corporate officers, according to Catalyst's "Women in the Fortune 500" article .
  • The recent US Supreme Court decision protecting same-sex union is being reflected by many corporations fast-removing barriers to employment by officially including sexual orientation in their anti-discrimination policies.

The Economic Benefits of Diversity-Inclusion:

Given these statistics, effective diversity recruitment has become a crucial element of the strategy in the war for talent, providing companies with access to the broadest possible pool of available candidates and to positioning national and international businesses as Employers of Choice for both majority and minority groups.

The cost to businesses of not being adequately diverse is very real. Research has shown that diversity candidates actively eliminate from consideration companies that demonstrate a lack of ethnic or gender diversity. Equally, organizations that fail to demonstrate commitment to diversity in upper management have been shown to lose a significant number of their diversity hires to organizations that offer more obvious opportunities for advancement. The cost of losing an employee is several times their annual salary and, as a result, retention has become as important as successful hiring. It is clear that many organizations still need to develop a better understanding of the specific developmental and motivational needs of the various populations within their workforce.

Diversity in hiring is seen as an increasingly important factor in improving corporate performance. As companies around the world focus more and more on the issue of corporate social responsibility, their approach to diversity will remain under public scrutiny. A recent series of well publicized discrimination cases, together with the rapid growth in information available on organizations seen as leaders in diversity, will trigger a more critical evaluation of performance in this area by external stakeholders and potential employees alike. If an organization's wider social responsibilities are not reflected in its hiring policies, its status as an Employer of Choice, its reputation in the business community and, ultimately, its financial performance will inevitably suffer.

The business case for diversity is particularly strong in the consumer marketplace. This is the result of an explosive growth in ethnic populations. New cross-industry research also shows that women are now responsible for up to 80% of consumer buying decisions. With an employee base that more accurately reflects their target customer base, companies are able to develop a deeper understanding of the diverse needs and tastes of their end user's, as well as a increased richness of ideas, which gives the competitive advantage in their marketplace.