These 3 Corporate Activities Need Diversity and Inclusion
Diversity, equity & inclusion isn’t just about company employees: it is also a company’s responsibility to incorporate DEI in its external-facing work
Like the reverberations of the #MeToo movement, #BlackLivesMatter has opened up a space and dialogue about systemic issues in society and the workplace. It’s a long awaited reckoning and a catalyst for change. Companies have been making statements and sometimes commitments in response to the movement, but there are still so many that need to demonstrate how they are addressing injustices.
Statements are nice, but companies need to take a hard look at what diversity, equity and inclusion (DEI) looks like in their workplaces. Sure, it’s good for business, but it’s also a moral imperative. Through tools, policies, programs and cultural change, there are many ways companies can increase diversity in their workplace, make people feel included and address equity through acknowledging differences and giving people what they need to succeed.
As well as looking inward, companies need to look at the effects of their external-facing work and how they’re connected to DEI: social impact, sustainability and corporate social responsibility (CSR) strategies can’t be forgotten. As key elements to these strategies, companies should take a DEI lens to their philanthropic activities, supply chain procurement and marketing approaches to ensure their efforts support greater diversity, equity and inclusion in society.
There is an inherent bias in much of current grantmaking that is exacerbated by decision-making boards that lack diversity and overburdensome application and grantmaking processes that ignore issues of equity. The power dynamics in philanthropy are hurting non-profits. Even when organizations focus on the same work and its leaders have similar education levels, black-led organizations’ revenues are 45% smaller and unrestricted net assets are 91% smaller than white-led organizations. For every $100 awarded by US foundations, only 28 cents supports LGBTQ+ issues. Social change movements are often gentrified.
Companies can address these issues in a number of ways: their philanthropy can support organizations that address systemic and structural issues; they can lay out selection criteria related to DEI priorities and approaches; they can provide unrestricted funding; and they can focus more on relationship-building and trust than paper pushing. Decision-making should be made by a diverse committee and can include a company’s employee resource groups (but don’t overextend their goodwill or require them to take on this mental load). Research also shows that when more women are in positions of company leadership, levels of philanthropy are higher.
A diverse supplier is a business that is at least 51% owned, operated and controlled by either women, members of an Indigenous community, people with disabilities, veterans, members of a visible minority group or members of the LGBTQ+ community. Supply chain diversity initiatives have been around for a while and there are plenty of organizations that certify companies and help to support their fair market access. Large multinationals have already spent billions of dollars over the years through their own diverse supplier programs and have taken different approaches to make them more inclusive.
These programs are not just great for CSR, particularly when they’re linked to sustainability, they’ve been shown to meet or exceed expectations, to improve quality and to support access to increased market share and revenue opportunities. As supplier portals and applications can seem like a black box with few responses or no follow-up, it’s important to take the extra steps of setting procurement goals, getting face to face with diverse suppliers, making applications accessible and, if possible, supporting these companies through skills development.
Marketing has an important role in CSR. Millennials and Gen Z want to buy from inclusive and socially-conscious companies and to see themselves in their advertising, but demonstrating diversity cannot just be variations on a default: it needs to show nuances of diversity and include different representations, relationships and interests. To approach marketing through DEI, companies need to understand their customer base in a more comprehensive way. To support this, marketers can be trained on how to recruit from underrepresented groups and how to think about inclusion when defining a target audience. Not only will this improve marketing, it will also help companies make better products and services (see my article on empathy in user design).
Companies that feel their DEI isn’t where it should be internally to create the campaigns they’d like can create a marketing advisory board. The members should be diverse, compensated fairly for their time and know that their opinions will be respected and acted upon. Don’t perpetuate inequities by expecting members to work voluntarily or with minimal support, benefit or authority, otherwise it will just be tokenism. And don’t forget to be aware of language use in terms of inclusiveness, empowerment and accessibility.
There is a significant amount of research that shows that diversity on boards and in management positions are linked to stronger CSR performance and higher levels of voluntary CSR and climate change disclosure reporting. A DEI approach from the top will help to grow and enable a company’s social impact, but then there must be additional work to make sure external-facing efforts also integrate a lens for DEI. These initiatives will only thrive if they are holistic, take into account the intersectional nature of diversity and are integrated throughout the whole company. It’s time to account for and address the external impact companies’ philanthropy, supply chains and marketing have on promoting diversity, equity and inclusion.
Three Ways to Improve Diversity, Equity, and Inclusion in Philanthropy (Brittany Boettcher & Kathleen Kelly Janus, SSIR)
Governance and Grantmaking: Approaches to achieve greater diversity, equity and inclusion (Philanthropic Foundations Canada)
Diversity & Inclusion in Corporate Social Engagement (Chief Executives for Corporate Purpose)
The Business Case for Supplier Diversity in Canada (The Conference Board of Canada)