The 2021 Diversity, Equity, and Inclusion Trends Report reflect the shift in how businesses are approaching diversity and inclusion. Once a differentiator, diversity and inclusion have risen as a cross-sectoral imperative in all aspects of operations, including recruitment, development, leadership, client relations, and more. There is a changing societal status quo – what may have been acceptable 10 years ago is no longer reasonable.
Simultaneously, the definition of diversity and inclusion has evolved as well. Diversity includes people from a range of different social and ethnic backgrounds and of different genders, sexual orientations, or economic status. Consumers and employees across every industry are demanding that companies prioritize diversity, equity, and inclusion (DE+I) in their business model changes. In 2021, businesses are expected to diversify leadership boards, focus on racial justice and equity, more strongly interconnect diversity and CSR teams, and match demand for transparency and advocacy.
Trend #1: Demand is Growing for DE+I Metrics that Provide Transparency and Drive Decision-Making
For many years, businesses have gotten away with false, overstated strides towards equality. DE+I has been at the bottom of the list of priorities among industry leaders, thus putting it on the backburner for most corporations. Despite efforts, there is continued
disparity in access to education, development, and technology within a company’s workforce and recruitment base – a divide that has only been widened as a result of the global COVID-19 pandemic.
In recent years, the private sector has established a need for diversity and change but has done little to make it happen; incorporating DE+I into strategy poses a unique opportunity to grow engagement while also making real, actionable strides. Leveraging people analytics and metrics can be used as a tool to improve engagement, collaboration, and innovation amongst teams. This will produce measurable results, such as a 56% increase in job performance, 50% decrease in turnover risk, and a 75% decrease in employee sick days, all of which contribute to a stakeholder-driven workplace climate.
Employees and consumers are demanding accountability. Now, more than ever, individuals are watching the actions of corporations closely. With the capabilities of social media, consumers have adopted a herd mentality for repudiating companies that do not meet standards. Due to strong pressures by consumers, many companies not currently taking action are being forced to rethink leadership and priorities, or risk being shut out.
The continued rise of automation will cause the loss of jobs in specific industries and departments that are traditionally more diverse; female employment in secretarial and administrative roles has decreased tremendously but has been outweighed by an increase in higher-skilled occupations. Organizations must leverage metrics to proactively monitor potential impacts and set goals to increase or maintain diversity after implementing automated solutions.
To effectively change norms and the business ‘status quo’, organizations will need to develop concrete action plans and roadmaps with DE+I. These plans must include recognition that a more intimate view of people analytics is relevant not only in representation but also perceptions of DE+I (employee surveys, workplace outcomes, and consumer engagement) and is crucial to tackling their internal problems head on.
“DE&I-related job openings have risen by 55% since June 8, after falling by 60% at the onset of the coronavirus pandemic in March, according to data from employment and recruiting site Glassdoor.”
Trend #2: Businesses are Feeling Increased Pressure to Diversify Senior Leadership and Corporate Demographics
Historically, corporate executive leadership has consisted of primarily white men. Only relatively recently has this expanded into men of color and women but continues to strongly exclude many groups including women of color, non-binary, and trans individuals. In response to inequities becoming more apparent in the United States, companies must react by pledging to be allies and working to create a diverse private sector workforce. Equitable opportunities in hiring/recruiting processes will be imperative moving forward in the movement towards an inclusive and equitable workplace.
Many companies are being recognized for their diversity or lack thereof, which can make a massive impact on reputation and subsequent sales volume or consumer response. It is necessary that companies reevaluate leadership demographics to better represent diverse groups and restore confidence in their values-based actions both internally and externally.
Listing agencies for publicly traded companies such as Nasdaq are proposing requirements that “would require all companies listed on Nasdaq’s U.S. exchange to publicly disclose consistent, transparent diversity statistics regarding their board of directors. Additionally, the rules would require most Nasdaq-listed companies to have, or explain why they do not have, at least two diverse directors, including one who self-identifies as female and one who self-identifies as either an underrepresented minority or LGBTQ+.” Thus, pressure to continue diversifying leadership will continue to persist until changes are universally adopted.
“The Silicon Valley Leadership Group, whose members include a wide cross-section of tech companies, has announced an initiative called “25 x 25” that seeks to increase minority executives by 25% by 2025.”
Contributions by Alexandra Hatsios