Diversity, equity, and inclusion (DEI) efforts in the workplace are of critical importance, now more than ever. DEI is more than donations, policies, or programs. Companies are changing/adjusting their business approaches to reflect their prioritization of DEI. According to one study released in 2021, almost 2 in 3 Canadian Companies launched initiatives to create a more diverse and inclusive workforce.
A study by McKinsey & Company and The Society for Human Research Management (SHRM) evaluated the performance of organizations for workplace diversity. They found that organizations that exhibit gender and ethnic diversity are, respectively, 15% and 35% more likely to outperform less diverse organizations. Similarly, organizations with more gender and racial diversity bring in increased revenue, more customers, and higher profits.
Organizations with diverse environments have increased job satisfaction amongst employees, increased levels of trust, and higher engagement levels. Diversity, equity, and inclusion programs lift the morale and overall attitude of all employees and also provide benefits at every level of the business. Strong DEI programs help every employee to show up each day without fear that they can’t be their true selves.
Despite these benefits, few organizations know what steps to take to create and foster diverse teams. Employees are more likely to support DEI efforts if they understand the many potential benefits, so it’s up to company leaders to share these insights with their team. To reap success from DEI, it is necessary to invest in diverse talent with broader knowledge, experience, and expertise to match complex global environments.
Here are some benefits of Diversity, Equity, and Inclusion crucial for any business:
1. Diverse and Inclusive companies are more likely to hit financial goals
Hitting financial goals is important to all firms – regardless of the industry. DEI efforts are incredibly important for retention. Highly inclusive companies are more likely to hit their financial target goals by up to 120%.
2. DEI improves the psychological safety of employees:
DEI helps employees feel safe, respected and connected. It’s so important for businesses to encourage their employees to bring their whole selves to work and celebrate them for all that they are. When companies work to create an inclusive professional environment, employees feel empowered to do everything they can to achieve goals for the betterment of the firm. An inclusive environment breeds effective teamwork and productivity.
3. Diverse teams propel innovation:
Diverse teams are better positioned to unlock innovation that drives market growth. Diversity of thought fuels new product development and generates opportunity for everyone. Companies with above-average diversity produced a greater proportion of revenue from innovation (45% of total) than from companies with below-average diversity (26%).
4. DEI leads to diverse perspectives:
Diverse teams have far more ways to execute an idea, which helps them to iterate faster and more cost-effectively. Employee diversity comes in handy in multiple ways during the planning and execution phase of a business strategy. There is always a diverse way of looking at things, leading to improved decision-making that benefits your company.
5. DEI helps with recruitment efforts:
People searching for a job look for companies with diverse and inclusion-rich cultures. A diverse and inclusive environment tends to bring employees a sense of belonging and community and overall helps with recruitment. According to Glassdoor’s 2020 Diversity Hiring Survey, “More than 3 out of 4 job seekers and employees (76%) report that a diverse workforce is an important factor when evaluating companies and job offers.”
6. DEI increases productivity and performance:
Diversity and inclusiveness of suppliers can positively impact business outcomes. Diverse teams are 70% more likely to capture and penetrate new markets. Having a wide range of personalities and backgrounds leads to insightful problem-solving capabilities and creative products. Diverse teams are 87% better at making decisions.
7. A diverse and inclusive environment helps retain employees:
Diversity, equity, and inclusion efforts are incredibly important for retention. DEI efforts lead to creation and development of a culture where all employees are welcomed and encouraged to thrive. If employees feel more connected at work, they tend to work harder and are more committed to the company and the overall direction of the company.
Effective DEI programs are no small feat and require inclusive, strong, and consistent leadership. Such initiatives are no longer a business choice — they are a moral imperative for a 21st-century organization. With DEI efforts, you know that your business will continue to evolve — so will workplace culture. Diversity and inclusivity in the workplace are one direction businesses should be heading because it has countless benefits to the growth of your brand, revenue, and how your business impacts society from within.