It’s easy to make a moral and ethical case for amplifying diversity, equity, and inclusion (DEI) in the workplace. All people deserve an equal chance to succeed in a professional environment, along with a basic expectation to feel welcomed and be treated with as much respect as everyone else. It’s hard to argue against this reasoning. It is, however, much more difficult to convince company leadership that DEI is a good investment, when looking at it from a purely fiscal perspective.
So, let’s talk about it. Is DEI a smart economic investment? Do companies tend to benefit monetarily when they focus on diversity, equity, and inclusion?
Although this is a complicated question to answer, evidence points to clear economic advantages for investing in DEI. A recent McKinsey & Company study discovered that organizations which employed more racially and ethnically diverse people, were 35% more likely to financially outperform other companies in their industry. This same study found that companies in the top quartile for gender diversity were “21% more likely to have financial returns above their respective national industry medians.”
This is certainly not the only study to come to a similar conclusion. Time and again, diverse and inclusive organizations have been identified as having greater market potential, higher profitability, and greater adaptability and creativity (which naturally adds value to an organization).
In my own experience, I have found that companies which invest in and emphasize DEI have higher retention (and lower turnover), a propensity for innovation, and a culture of respect and transparency. They also have something else that is difficult to measure—a certain spark and motivation that is apparent at all levels of the organization. I see this in the way teams engage when I give a presentation (asking questions, taking notes, following up) or when I work with the leadership team. I see it in the way teammates interact with and treat one another.
Even with all this evidence, it can still be difficult to convince company leadership that DEI is a great investment. If that’s been your experience, here are a few ideas to help make your case:
- Point out relevant studies that spotlight the advantages of DEI
- Provide concrete examples of organizations that have benefited financially from investing in DEI
- Highlight the potential for improved innovation and creativity within diverse and inclusive teams
- Emphasize the positive impact on employee retention and lower turnover rates
- If relevant, share personal experiences of witnessing the positive effects of DEI efforts
- Frame DEI as a way to tap into untapped market potential and reach a broader customer base
- Highlight long-term benefits of creating a diverse and inclusive workplace, including attracting top talent
DEI efforts are not only a moral and ethical imperative, they have also proven to be a smart economic investment. Initiatives focused on diversity and inclusion are more than just a passing trend. This is necessary work for any organization that wants to thrive in today's global and interconnected business landscape. I encourage you to speak up and approach company leadership with a well-prepared case showcasing the concrete benefits of DEI initiatives. The future of DEI-centered workplaces depends on the tenacity and advocacy of individuals who understand the significance of this important work.
Looking to make a meaningful impact in DEI at your workplace? Join me in Milwaukee on March 5th-6th for Shape the Future: Inclusive Leaders Summit, a powerful seminar meant for leaders who are looking to move the needle on DEI in their workplace.