Are Fear and Misunderstanding Blocking Your DEI Efforts?

As the CEO of BCT Partners, a global firm whose mission is to harness the power of diversity, insights, and innovation to transform lives, accelerate equity, and create lasting change, I am well aware of the push-back that has been occurring in certain corporations, organizations and educational institutions regarding diversity, equity, and inclusion (DEI). Regretfully there are several factors underlying this resistance.

First, and perhaps foremost, is fear. Some people are afraid that DEI is a threat to their power, their standing, their way of life, or their very existence. This is rooted in a “zero-sum” mentality that more DEI means they will necessarily receive less of something – that it will be unfair to them or lead to less opportunity for them – without realizing that DEI is rooted in fairness and opportunity for everyone.

Second is ignorance. DEI is blindly perceived as indoctrinating people, re-writing history, establishing quotas, lowering standards, and dividing people, whereas DEI is about liberating people, balancing how history is told, setting goals just like any other business function, maintaining the highest standards to recruit, retain and advance the best and the brightest, and bringing people together.

Third and finally is misunderstanding. The very words “diversity,” “equity,” and “inclusion” have been coopted in a negative light, whereas the underlying principles of DEI are about fairness, dignity, and justice for all. I don’t think I am naïve to firmly believe that most people fully support these tenets, and if they truly knew them to be the core principles of DEI, they would not mount resistance.

From a business perspective, arguments for the value of DEI to organizations are very clear. Some refer to this as “the business case” or “the organizational case” for DEI. The benefits from an organizational perspective are myriad and have to do with:

• Winning the competition for talent. Organizations that have a strong commitment to DEI are better positioned to recruit and retain skilled workers in today’s marketplace. In 2021, Glassdoor found that 76% of employees and job seekers said a diverse workforce was important when evaluating companies and job offers.
• Strengthening customer orientation. The University of Georgia’s 2021 Multicultural Economy Report lists the buying power of African American, Asian American, and Hispanic consumers at approximately $4.8 trillion of the overall $17.5 trillion for the entire U.S. in 2020. It is a no-brainer that this is a worthwhile market. But to truly capture it, you will have to understand it and embrace the diverse dimensions of it.
• Increasing employee trust, retention, engagement, satisfaction, and performance. There is strong evidence that diverse teams increase employee satisfaction and reduce conflicts between groups, improving collaboration and loyalty. According to a 2015 Changeboard study, “working in a diverse team’ is among the top five most important drivers of employee engagement and discretionary effort in the workplace.” Specifically, the study found that employees work 12% harder, are 19% more likely to stay longer and collaborate up to 57% more effectively at companies with diverse leaders.
• Improving decision-making and fostering innovation. Research shows that while diverse teams take longer to achieve cohesiveness and make decisions, they make better decisions up to 87% of the time. Academic research has shown that companies with diverse management teams produce more innovative products.
• Enhancing the organization’s image. Incorporating a strong DEI agenda will improve your organization’s image to employees as well as customers. A 2001 public opinion survey by Environics International found that in wealthy countries such as the United States, social responsibility makes a greater contribution to corporate reputation than brand image. In North America, a study showed that 42% of consumers punished companies by no longer purchasing their products or services. Social responsibility is also becoming increasingly important in many countries, such as the United Kingdom, which have legal requirements for diversity as of 2010.
• Improving the financial bottom line. Several studies by McKinsey have found that corporations that embrace gender and ethnic diversity on their leadership teams outperform their competition financially by as much as 25% and 36%, respectively. They also found that in the United States, there is a linear relationship between racial and ethnic diversity and better financial performance: for every 10 percent increase in racial and ethnic diversity on the senior-executive team, earnings before interest and taxes (EBIT) rise 0.8 percent. Similarly, in the United Kingdom, greater gender diversity on the senior-executive team corresponded to the highest performance uplift: for every 10 percent increase in gender diversity, EBIT rose by 3.5 percent.

While some find it valuable to understand the business case, there are others who are more inspired by the moral case – the argument that DEI is not just the right thing to do from a business perspective but simply the right thing to do. The moral case is grounded in our personal values and “The Platinum Rule” that we should all treat people the way they want to be treated. In fact, there is evidence that chief diversity officers are increasingly finding the moral case to more effective in garnering support for DEI than the business case. Quite powerfully, one of the ways to espouse and reinforce the moral case is by overcoming any fears to find and amplify your voice on matters that relate to DEI.

As CEOs, we must educate ourselves and have command of DEI just as we must educate ourselves and have command of other disciplines such as finance, marketing, sales, and operations. Take baby steps to slowly find your voice in safe spaces and smaller groups, and very soon, you will be able to exercise and amplify your voice in larger groups and more challenging spaces. It’s OK to make mistakes as you can recover from them. It’s not OK to remain silent about DEI issues that, if addressed, will ultimately promote dignity, humanity, and respect for all.

Written by Dr. Randal Pinkett.

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