Did companies scale back on DEI in 2024?
The current state of Diversity, Equity, and Inclusion (DEI) initiatives in companies presents a complex and evolving picture. While some evidence suggests a scaling back, other data points towards continued investment and even increased focus.
On one hand, reports from Culture Amp and SHRM indicate decreased perceived investment in DEI, fewer dedicated DEI roles, and challenges like budget constraints.
High-profile cases of companies like Walmart and Lowe's reducing their DEI programmes contribute to a narrative of retreat. This shift is often attributed to economic downturn, “anti-woke” backlash, and a perceived lack of return on investment in DEI.
Diversity, equity, and inclusion is a framework that promotes fairness and respect for all people, regardless of their race, ethnicity, gender, sexual orientation, age, religion, or any other dimension of their identity. It recognises that everyone deserves to feel valued, respected, and supported, and that creating inclusive environments benefits both individuals and society as a whole.
Diversity refers to the presence of a wide range of human differences within a group or organisation. It encompasses not only readily visible differences like race and gender but also less visible ones such as socioeconomic status, sexual orientation, and disability status. A diverse environment brings together people with varied perspectives, experiences, and backgrounds, enriching the collective whole.
Equity goes beyond simply treating everyone the same. It acknowledges that people have different needs and may require different levels of support to achieve fairness. It aims to remove systemic barriers that have historically disadvantaged certain groups and create conditions where everyone has the opportunity to thrive.
Inclusion is the practice of creating environments where everyone feels welcome, respected, and valued. It involves actively seeking out and incorporating diverse perspectives, ensuring that all voices are heard, and fostering a sense of belonging for all individuals.
DEI is important because it fosters innovation, creativity, and problem-solving. When people from diverse backgrounds come together, they bring with them a wider range of perspectives and ideas, leading to more creative solutions and better decision-making.
Also Read: How do microcultures influence organisational culture?
Are companies scaling back on DEI in 2024?
Culture Amp's 2024 DEI research found a decrease in perceived DEI investment and employee perception of DEI efforts in 2023 compared to previous years. It also highlights a decline in companies hiring external DEI consultants and fewer organisations having dedicated DEI leadership roles.
But not all companies are scaling back on DEI. Certain sectors, particularly those with a strong consumer-facing presence, continue to prioritise DEI as a key business strategy. DEI initiatives have been helpful in ramping up talent acquisition efforts, brand reputation management, and corporate social responsibility.
What’s notable is that the nature and focus of DEI initiatives are also shifting. There's a growing emphasis on measurable outcomes, tying DEI to business goals, and demonstrating a clear link between diversity and business success.
This means tracking metrics like employee engagement, representation in leadership, and innovation, while also highlighting the positive impact of DEI on profitability and market share. This shift is driven by increased scrutiny from stakeholders, a focus on ROI, and a growing body of research supporting the link between diversity and business performance.
This shift is driven by a confluence of factors. Investors are increasingly demanding transparency and accountability around DEI, recognising its impact on long-term value creation.
Customers, particularly younger generations, are more likely to support companies that align with their values of inclusivity and social responsibility. Employees are also demanding more from their employers, seeking workplaces where they feel valued, respected, and have opportunities to thrive.
Furthermore, in a challenging economic climate, organisations are under pressure to maximise the return on all investments, including those in DEI. This has led to a greater emphasis on measuring the impact of DEI initiatives and demonstrating their connection to business goals.
Ultimately, the organisations that thrive in the future will be those that embrace DEI not just as a compliance exercise, but as a fundamental business imperative. By embedding DEI into their culture, strategy, and operations, these companies will be best positioned to attract and retain top talent, foster innovation, and achieve sustainable success.
Also Read: Talking politics at work? How to manage diverse views
How to promote DEI in your organisation
Creating a truly diverse, equitable, and inclusive organisation is challenging, but certainly possible with the right mindset, tools, and people. It requires a long-term commitment and a willingness to challenge the status quo. But the benefits are clear: DEI leads to a more engaged workforce, a stronger company culture, and improved business performance.
Here’s how to promote DEI in your organisation:
Start building a diverse workforce
Go beyond simply acknowledging the importance of diversity. Implement inclusive recruitment practices by using diverse sourcing channels, blind resume screening, and diverse interview panels. Actively target underrepresented groups in your recruitment efforts and ensure your employer branding materials reflect your commitment to DEI.
Foster an inclusive culture
Create an environment where diverse perspectives are not only welcomed but truly valued. Encourage open dialogue and create platforms for diverse voices to be heard. Implement mentorship and sponsorship programmes specifically designed to support and uplift marginalised employees.
Implement equitable policies and practices
Equity goes beyond avoiding discrimination. Proactively ensure fair compensation practices with regular pay equity audits. Provide equal access to promotion opportunities and professional development resources for all employees regardless of background. Consider flexible work arrangements and inclusive benefits packages that cater to the needs of a diverse workforce.
Offer DEI training
Provide comprehensive and ongoing DEI training to all employees. This should cover topics such as unconscious bias, microaggressions, inclusive language, and allyship. Make sure the training is interactive and engaging, and provides practical strategies for promoting inclusion in the workplace.
Measure progress
Set measurable DEI goals and track your progress regularly. Collect data on employee demographics, promotion rates, and employee engagement. Hold leadership accountable for achieving DEI goals and use data and feedback to continuously improve your DEI initiatives.
Also Read: Supporting underrepresented groups at work
The future of DEI in the corporate world
Moving forward, successful DEI initiatives will be characterised by a data-driven approach, where organisations leverage metrics and analytics to track progress, measure impact, and demonstrate a clear return on investment. This data-driven mindset will enable companies to identify areas for improvement, refine their strategies, and ensure that DEI efforts are aligned with business objectives.
DEI will no longer be a standalone initiative, but rather an integral part of the organisation's overall business strategy. It will be woven into the fabric of the company, linked to core business objectives, and viewed as a key driver of innovation, growth, and market competitiveness.
To ensure the effectiveness of these initiatives, companies will need to establish clear accountability structures. This means defining roles and responsibilities, setting measurable goals, and holding leaders accountable for driving DEI progress.
Successful DEI initiatives will adopt an employee-centric approach, prioritising the needs and experiences of all employees. This includes fostering a sense of belonging, creating a workplace where everyone feels valued and respected, and providing opportunities for all individuals to thrive and reach their full potential.
Ultimately, the organisations that thrive in the future will be those that embrace DEI not just as a compliance exercise, but as a fundamental business imperative that fuels innovation, strengthens culture, and drives sustainable success.