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“Diversity and inclusion are not luxuries reserved for high-performing companies in flush times. They constitute a powerful lever for improving performance." – global consulting firm Boston Consulting Group.
DEI is more than a buzzword. Diversity, equity and inclusion are three socially responsible principles businesses of every size are integrating across their operations, from strategic planning and goal setting to hiring, strategy implementation, profitability measurement and more. In doing so, these organizations are seeing payoffs in all facets of their culture and operations.
The University of Washington’s Office of Research defines diversity as “the presence of differences that enrich our workplace. Equity is ensuring that access, resources and opportunities are provided for all to succeed and grow, especially for those who are underrepresented and have been historically disadvantaged. Inclusion is a workplace culture that is welcoming to all people regardless of race, ethnicity, sex, gender identity, age, abilities and religion, and everyone is valued, respected and able to reach their full potential.”
“DEI is more than a static policy or values statement that lives on a business’ website,” said Jenel Harju, Senior Client Relations Director with PayneWest Insurance’s Business practice. “DEI is about taking measurable actions to address systemic social inequities, build a stronger and more inclusive workforce, and improve economic mobility for women and other minority groups.”
Such actions can include self-reflection and exploration of unconscious bias, listening and learning, creating a culture of equity, standing up against racism, committing to transparency, amplifying underrepresented voices, prioritizing representation, holding leaders accountable and improving board diversity.
A DEI journey can begin in many ways, starting with strategic development from the HR team, senior leadership or the board of directors. Ultimately, a path that includes all levels of an organization will have the most effect on an organization’s culture and in producing successful outcomes.
“PayneWest knows that our own DEI journey has just begun and that it will be an ongoing growth and learning process, one which we embrace with gratitude and support with grace,” Harju said. “We recognize that DEI is a powerful component of our culture, and we are very intentional about how we invest in this opportunity and authentically and positively impact our relationships Clients, Colleagues and Communities.”
Businesses who are making sincere commitments to embed DEI into their operations are not only creating positive social change and helping bridge the racial and gender wealth gap, they are also retaining talent and improving organizational performance and profitability. The studies by leading consulting and advocacy groups clearly show an advantage to businesses committed to DEI principles.
According to global advocacy group Women Deliver, “When women hold more executive leadership positions, their companies are more profitable. Companies in the top-quartile for gender diversity on executive teams are 21% more likely to outperform the national average.”
A study by Boston Consulting Group found that "increasing the diversity of leadership teams leads to more and better innovation and improved financial performance," finding that increasing diversity amongst management leads to 19% higher revenue due to innovation. Similarly, a report by Deloitte found that companies with inclusive cultures were six times more likely to be innovative and agile.
A McKinsey & Company report studying the financial performance of technology companies found that the top racially diverse companies are “35% more likely to have financial returns higher than the tech sector’s national median,” more gender diverse companies are “15% more likely to outperform others” and ethnically diverse companies are “35% more likely.”
Customers also see the value in DEI. In recent years, it has become common for consumers to conduct research prior to making purchases and prioritize companies that are socially and environmentally responsible. A survey of consumers by the IBM Institute for Business Value found areas of social responsibility like gender equality, ending racism and promoting opportunity were very important or extremely important to 75% of respondents.
DEI is becoming a critical facet of business, from the board room to the bottom line. Organizations that commit to advancing DEI are likely to continue to be relevant and profitable.
“From creating collaborative and respectful relationships to enhancing employee empowerment and participation, we are fully aware of the benefits created with a diverse, equitable and empowered workforce,” added Harju. “At PayneWest we have our eye on today and the future.”