New research by Josh Bersin analysts have found that despite corporate efforts to put up a good face on the diversity and inclusion front, the traditional approach of making HR responsible for D&I is far less effective than many assume, and may even do more harm than good.

According to the report, “Elevating Equity: The Real Story of Diversity and Inclusion”, D&I should be integrated into business strategies and not left to HR practices. The research findings highlighted that when business leaders believe that diversity is good for business—and therefore presumably build it into their strategy—organizations are 2.9 times more likely to excel in innovation. Furthermore, when a business focuses on diversity, equity, and inclusion (DEI) in its entire company ecosystem, it is 2 times as likely to have good financial results and 4.6 times as likely to retain customers.

In contrast, the research found that out of 20 different categories of potential HR expertise, HR professionals rank themselves as being least proficient in DEI, meaning they may not be as suited to take the lead for DEI as people believe. 80 percent of survey respondents said they are beginners in the area and only 3 percent said they have deep expertise.

The findings also question other traditional methods of improving a company's DEI, such as hiring or training for diversity. According to the report, hiring for diversity is not a sufficient starting point, and is only useful if the entire organization already supports diversity. Training, meanwhile, has minimal impact on business outcomes and may even backfire if employees respond negatively.

Instead, the report recommends “listening to employees and acting on results” as the best way of succeeding, with this practice ranking top among predictors of business outcomes analyzed. It also highlights the importance of benchmarking DEI performance against other organizations, focusing on inclusion as an outcome, and being transparent about communicating DEI progress internally, with all these practices very strongly correlated to high performance.

The research also identifies four levels of DEI maturity in an organization, also strongly correlated to business outcomes: the lowest level being risk mitigation and compliance, and the highest level being a focus on accountability and DEI outcomes.