Paaras Parker, CHRO, Paycor.
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Diversity, equity and inclusion (DE&I) is one of the most critical focus areas of any HR strategy. Centering these values no longer makes you stand out from the pack; today, it’s the baseline. Implementing a strong DE&I plan is essential for recruiting and retaining top talent and for engaging with your customer base. It demonstrates that your business is tuned into today’s cultural standards.
Core Values Versus Bonus Initiatives
So what does it mean to make DE&I a core value? To put it simply: These ideals need to be ingrained in your company’s mission. Just publishing a statement about diversity isn’t enough—you need to put your money where your mouth is.
Bonus initiatives are relatively simple and easy to implement. You could start an ERG, donate to a good cause or add Juneteenth to your company calendar—but it stops there. Your team won’t see any big changes when it comes to hiring, internal recruiting or partner relationships.
But DE&I isn’t just a box that leaders can check and then move on. This is a fundamental shift in the way companies are doing business.
Core values have a systemic impact on big and small decisions. Your DE&I strategy should change the way you recruit new team members, or it should help you offer more options for employee education and career development.
Measure Your Impact
If you can’t measure your success, who’s to say your strategic approach has actually improved? Transparency is key here. Make a public commitment to certain DE&I efforts—you can decide which ones matter most to your company—and when the numbers come in, be accountable to your team and your client base. Just like you’d pivot to a new strategy based on quarterly earnings, your approach to DE&I will probably have to change more than once before you find what works.
There’s a downside to transparency: It opens you up to pushback. Your wider community—including customers, shareholders and more—is going to have strong opinions about your progress. As a leader, you’ll probably need to have some conversations with key stakeholders in your business. That’s just what it means to advocate for your values.
How DE&I Impacts Recruiting And Retention
Are you staying up at night worrying about recruiting and retention? You’re not alone. We’re facing a national labor shortage, and it’s not going to get better overnight. The good news is, there’s a clear way to expand your talent pool: 80% want to work for a company that values DE&I.
DE&I also drives retention. According to one study, inclusive companies are three times more likely to retain Millennials for more than five years. That’s true for countless reasons. For one thing, company culture improves engagement, and making your employees feel welcome is a huge part of that. On a more practical level, people who experience discrimination at work are at a higher risk of injury, illness and other causes of absenteeism.
Identifying And Interrupting Minority Stress
If you’ve never experienced it yourself, minority stress can be hard to recognize. This heightened state is caused by the pressure of living with stigma, microaggressions, tokenism and outright discrimination. Anyone with a marginalized identity can experience ongoing minority stress.
Minority stress is more than a cultural phenomenon—it’s also a health problem. According to the National Institute of Health, it can increase the risk of mental health issues, physical illness and even poor surgery outcomes. If you want your employees to do well—either at work or in their personal lives—minimizing minority stress is a great place to start.
As an employer, you can’t protect your team from living in the world. No workplace policy is going to change the way a person walking down the street looks at your top sales rep. But you can create an inclusive environment, in which people feel safe to be themselves.
DE&I And Financial Success
Company culture matters—and so does your revenue. It’s hard to justify the big, sweeping changes that come with a new focus on DE&I unless they can make a notable impact on your bottom line. But it’s not hard to interpret the numbers. Data shows a strong association between diverse teams and higher ROI.
That’s partly because of the key role DE&I plays in marketing. Data shows that consumers make purchasing decisions based on their values—and more than half are influenced by a brand’s support of social issues. This trend is especially clear in younger generations, and as they gain more purchasing power, the numbers will likely only go up.
Final Thoughts
DE&I touches every aspect of business, from sales to succession planning. In this era, it’s just not enough to recognize that by throwing together a couple of quick projects. Going forward, I believe DE&I will be foundational to any successful, sustainable HR strategy and business.
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