Focusing on talent diversity is no longer optional. It’s a requirement for optimum business performance—and the mandate needs to come from the very top. A true diversity and inclusion initiative is about more than ensuring that rules are followed and the requisite diversity programs and regulations are in place. It needs to be part of a company’s core values, not an add-on that looks good on paper. More and more CEOs are recognizing the benefits of true talent diversity for not only their companies bottom lines, but also for their employees’ personal growth and the growth of the economy as a whole.
Diverse companies outperform non-diverse companies
Research continues to show that companies with a diverse workforce perform better financially. According to PricewaterhouseCoopers’18th Annual Global CEO Survey, 85% of the CEOs surveyed said their formal diversity and inclusiveness strategy has improved their bottom line. And recent research from McKinsey shows that out of 366 public companies examined, ethnically diverse companies are 35% more likely to have financial returns above their respective national industry medians. Furthermore, a new Credit Suisse report explains that companies with women as board directors, as well as those with lesbian, gay, bi-sexual and transgender employees in senior roles, outperform the companies that lack that diversity.
Focusing on Diversity helps bridge the talent gap
The wider the net that businesses cast to find talent, the more options they’ll have. When those options open up to include multiple channels and as many varieties of people as possible, the talent gap gets smaller. Not only do companies up the sheer numbers of people to add to their talent networks, they also generate more interest from the talent they want to recruit when they can show their commitment to talent diversity. Research from PricewaterhouseCoopers shows that 86% of female and 74% of male millennials take a company’s policies on diversity, equality and inclusion into consideration when deciding whether or not they want to work for them.
Helping the economy
When it comes to gender diversity and inclusion, people are seeing a very positive “ripple effect” on families, communities and overall economies when companies provide women with more opportunities to advance in business. In fact, according to the nonprofit diversity organization, Catalyst, “The economic empowerment of women can improve a country’s growth and stability, combat shrinking labor forces and raise the gross domestic product.”
Opening opportunities to learn and grow
People of differing backgrounds bring wide-ranging experiences and varied viewpoints to the table in companies that embrace diversity. This variety of ideas and opinions often leads to much better decision-making than in companies with too many likeminded people. Some research also suggests that it’s not just the variety of ideas that lead to improved decisions, it’s also the increase in processing time. Diverse groups take more time to process all the information at hand in order to thoroughly understand different viewpoints and therefore they make better informed decisions that drive high-performance cultures. Additionally, a great by-product of diverse cultures in the workplace is an increase in knowledge, understanding and acceptance that can translate to communities outside of work. For people who normally might not get the opportunity to interact with and really get to know people from different ethnic groups, or with a different sexual orientation or global outlook, talent-diverse companies provide a chance to challenge preconceived ideas and prejudices, and help stop discrimination.
A truly diverse organization goes beyond investing in blanket diversity initiatives and instead works to foster lasting cultural change in talent networks.
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