Diversity, equity, and inclusion (DEI) continued to be prominent topics for business leaders in 2021. As Bain & Company’s inaugural chief diversity officer and global leader of our Diversity, Equity, and Inclusion consulting practice, the start of 2022 provides me with an opportunity to reflect on what we learned this past year and how to continue the momentum on sustainable change.
In our client work, we saw an unprecedented corporate push in DEI. Corporations realized the unique and critical role they need to play (alongside governments and NGOs) in creating more equitable outcomes in our society. And we see mounting evidence that stakeholder pressure will continue to accelerate this trend:
- Employees: Seventy-six percent of job seekers and employees consider a diverse workforce an important factor when assessing a company or job offer.
- Investors: Sixty percent of surveyed private equity limited partners request DEI demographic data.
- Consumers: One in three consumers consider a brand’s public commitment to DEI when making a purchase decision.
- Regulators: Multiple jurisdictions have recently enacted laws (or are considering doing so) that require companies to increase transparency in disclosing the diversity of their boards and the policies they have in place to improve diversity of their boards. California went so far as to pass a law requiring that all California-headquartered companies have a minimum of two directors on the board from underrepresented communities. (A Los Angeles County Superior Court judge recently struck down that law, though the state may yet appeal that ruling.)
Out of the rush of DEI activity last year, three lessons surfaced for me:
- Multiyear results matter most, but continued progress also requires that companies publicly articulate goals—now. Specific goals with tangible metrics inspire organizations. Too many of the stated goals today, however, focus solely inside a company’s four walls and don’t take aim at the broader marketplace and community outcomes. For example, fewer than half of the Fortune 50 have externally communicated supplier spending goals. And too many goals stop at broad aspirations to increase diverse representation without providing clear focus on specific populations or metrics for progress.
- These multiyear results must be the responsibility of line leaders. The past few years have seen extraordinary growth in the hiring of chief diversity officers (CDOs) and expansion of their teams, and that is absolutely necessary to support real change. Yet it is business line leaders who ultimately make the hiring, deployment, and promotion decisions that result in diverse representation, and therefore they need to take accountability for delivering sustainable results.
- Inclusion is powerful—and universal. For companies to unlock the power of diverse teams, every individual must feel a strong sense of inclusion. What does “inclusion” mean? Our research found that people of all backgrounds describe inclusion quite similarly: the feeling of belonging in their organization, feeling treated with dignity as an individual, and feeling encouraged to fully participate and bring their uniqueness to work every day. However, we also found that the majority of people, regardless of background and tenure, do not feel fully included at work, so a focus on inclusion can often be the right place for organizations to jump-start their DEI journeys.
So what should companies do if they aspire to achieve even more progress in 2022?
Set a holistic DEI ambition. Successful DEI strategies focus both inside and outside an organization’s four walls. They include an equitable talent journey, an inclusive culture, and fair wages and benefits, as well as strong external engagement in the marketplace and in the community. For all aspects of your ambition, ensure that you have explicit goals and tangible metrics to measure progress. I’m proud that we released our first DEI report at Bain, in which we shared goals for our people, our business, and our community.
Listen to all of your stakeholders, focusing on amplifying marginalized voices. Studies have shown the enormous value of employee listening (for example, employee engagement surveys). At Bain, we look at sentiment data through various demographic and intersectional cuts and share results with leaders across the firm. Your external stakeholders also require the same effort to listen. It’s important that the marginalized groups you are working to better support are a central part of any design teams seeking to make change, whether you’re redesigning an employee onboarding process or creating a new marketing strategy.
Remember that DEI is a journey and not a destination. I share with my teams and clients that DEI is different from other transformations—it is deeply personal, it’s inherently subjective, and it’s difficult to know the end state. Making progress on DEI often requires going slow to go fast; taking the time to deeply understand the challenges, fully define the problems, and recognize the highest-impact opportunities is critical. I’m encouraged by the progress I have seen across businesses, but I simultaneously acknowledge that meaningful change will take much more continued focus, effort, and time.