The spotlight has never shone brighter on diversity and inclusion in businesses and the responsibility to drive change lies with those at the top. The murder of George Floyd by Minneapolis police officers and the consequential rise of the Black Lives Matter movement has meant the light on corporates, as regard to their culture and inclusion policies, has intensified with renewed shareholder and stakeholder focus. Quickly, organisations around the world scrambled to release statements of support for BLM and committed to do better on diversity, equality and inclusion. So… What next? Boards and senior leadership need to take responsibility for bridging the ‘say-do gap’ with tangible actions that will shift the dial on diversity and inclusion in their organisation.
Your diversity and inclusion strategy should be viewed as a major change programme. This is about bottom-line performance and the long-term competitiveness of the organisation, not just box ticking. In their 2020 Diversity Wins report, McKinsey found a direct correlation between diversity and financial performance. Making D&I a top priority at your organisation will drive busines performance.
In collaboration with Fiona Hathorn, CEO of Women on Boards UK, we have compiled a 6-step roadmap for boards and senior leadership to shift the dial on diversity and inclusion.
1. Start at the top – Review your board composition and skills
Diversity in the boardroom and senior leadership teams is paramount to gain the diversity of thought that drives quality decision-making. To get buy-in throughout your organisation, a commitment to change needs to come from the top and cascade down through the organisation. Ask yourself: Do your NEDs represent your stakeholders in terms of background and demographics? Is there expertise in change, culture, inclusive leadership, recruitment and D&I within your board?
2. Listen, define and lead your change programme
To become a diverse and inclusive organisation, listening and learning from diverse perspectives is vital. This will help form your D&I ambition, goals and strategy. Your D&I experts should guide you, but they can’t sort it out whilst everyone else carries on as normal. A clear vision of D&I’s business benefits will get you initial buy-in, but your behaviour, decisions and priorities will generate the belief needed for your change programme to succeed. Make sure your board is regularly updated on progress and metrics in your D&I strategy and executives have D&I KPIs, division by division, linked to their remuneration.
3. Invest in a culture of inclusion
Inclusion is vitally important as without it you cannot reap the benefits of a more diverse team. In a culture of inclusion, employees are more engaged and share divergent viewpoints which, if well-managed, generate innovation. In a culture where not everyone feels included, valued, and able to progress, retention of diverse talent suffers. Up-skilling your managers in collaborative and inclusive leadership through research-based training can help shift the culture.
4. Understand your data and monitor progress
Every organisation will differ in its specific diversity and inclusion challenges. However, you can’t make improvements if you don’t first understand the issues, and how they vary across your organisation. Diversity data will give you a very accurate picture of where you are and why you’re there. As a minimum, conducting gender and ethnicity pay gap analysis will help you discover:
- The overall representation of women and minority groups throughout your organisation – are they overrepresented in lower paid positions and underrepresented in higher paid ones?
- Where they are not successfully retained.
- Where they are facing barriers to progression and promotion.
Use data data-driven insights as a tool to track progress, support your D&I strategy and inform future plans. Click here for the 7 steps to take before conducting ethnicity pay gap analysis.
5. Support ambition
Ambition and talent are equally distributed across diverse groups, but the information and opportunity needed to progress is not. Put plans in place to enhance the development and potential of your people. Under-represented groups do not need training to become more like a majority group but do benefit from understanding the strategies for career progression which research shows are effective. Mentoring, sponsorship and integrating non-executive board roles early on in a career can develop the strategic skills needed to move into senior leadership – at little cost to your company.
6. Remove blocks to diversity in your talent pipeline
Analysis of your diversity data can highlight specific groups that are underrepresented at different stages of their careers. A simple hack of the gender pay gap pay quarter data can show you the disparities between specific groups across the pay range of your organisation.
This is often a much more powerful way of identifying inequality than looking simply at the pay gap percentage, which doesn’t show the whole picture. For some organisations these issues begin at entry-level whilst others find gaps arise mid-career. Policies such as flexible working, paternity support and returner support can be effective in closing mid-career gaps. For industries (such as STEM) that experience entry-level gaps due to underrepresentation in education, we suggest partnering with organisations to offer funding, work experience or inspiration and visibility to these groups. However, sometimes there are no quick fixes.
Start shifting the dial
Most cultural change projects fail due to a lack of belief in the senior leadership team, usually because they haven’t been able to communicate their visions effectively enough to inspire belief in their teams. The Board and senior leadership need to proactively shift the dial on diversity and inclusion. Listen and learn from your people, communicate your intentions clearly, build trust and increase transparency.