Reports of massive layoffs disproportionately hitting corporate diversity, equity, and inclusion teams (DEI) and non-white professionals are one the latest setbacks for DEI professionals.
Just a few years earlier in 2020, DEI professionals moved to the forefront of corporate hiring after the George Floyd racial protests, and major companies flush with cash declared their commitments to tackle inequalities in their organizations.
In tighter financial times, DEI is likely to be considered an expendable part of a company. Despite evidence suggesting that inclusive organizations are more nimble and adaptable to change when the economy sours, DEI is still often considered the fat to be trimmed.
This expendability narrative would be a harder sell to corporate leaders if companies understood the business value of their own DEI efforts.
Today, more than ever, finding the business case for diversity is a competitive advantage. Under America’s rapidly changing demographics and global business competition, diversity has become a business imperative.
Research shows that linking business goals to diversity and inclusion strengthens an organization’s commercial potential. Recently, a major report on the $9.3 billion U.S. DEI market said that the global economy “is opening up rich opportunities for companies to spearhead growth by leveraging their access to a diverse talent pool” which “enhances creativity and drive innovation” and “challenges long-held traditional business ideas and assumptions.”
The companies that are committed to DEI are achieving results. The same 2022 Research and Markets analysis reported that diverse and inclusive companies earn 2.5 times more per employee and are 35% more productive.
Over my 17-year career as a diversity and people executive, I have seen repeated examples of diversity’s contribution to company value. Goldman Sachs, for example, is one of the most recognizable Wall Street brands to embrace diversity as a core business component. There, a lack of representation was identified as negatively impacting revenue.
From hiring more Native and Indigenous private wealth advisors to Spanish-speaking bankers from top MBA programs, there were multiple business cases for attracting underrepresented talent. Goldman needed to build stronger relationships with diverse communities. The firm knew this effort was good for business and morale.
Major financial institutions whose DEI efforts reaped new business opportunities were featured in a 2017 joint report from FSG and PolicyLink, a social change consulting firm and racial equity research institute. In one case study, the report cited a new type of checking account Citibank created after a multi-year inclusion effort to understand the barriers to and reach underbanked areas–often Black and Hispanic/Latine communities–with new financial products.
Customers could sign up for this new type of checking account online, with no overdraft fees and with small or zero monthly charges. With lower barriers to entry, the new product took off. Eventually, it would make up nearly 25% of Citi’s new checking accounts.
Also in the financial sector, the investment firm Athena SPAC (Special Purpose Acquisition Company) is one of the latest leading faces of what’s possible. I sit on the firm’s board–and our dedication to building a diverse expert network of women investors is its core business vision.
In 2021, the Athena Technology Acquisition Corporation became the first all-women-led SPAC to take a company public. The Athena family has produced the first Black woman and Korean American-woman CEOs to ring the New York Stock Exchange (NYSE) bell for an IPO. Its founder, Isabelle Freidheim, became the youngest woman chairman of a publicly traded company.
In biotech, lagging health advancements for women and underserved communities are tied to a lack of diversity in pharma and the broader healthcare field. According to the Biotechnology Innovation Organization, the leadership profile of the major biopharma companies in the U.S., Europe, and Australia is more than 65% male. One in four is non-white.
Diversity is driving a positive movement. A rise in the number of women in the ranks of biopharma, life sciences, and venture capital is creating a new wave of interest in advancing exciting early science into therapeutics for women’s health and wellness. As the current president of 82VS, the venture studio arm of Alloy Therapeutics, I see how representation is critical to elevating under-researched and under-funded health predicaments. With a team identifying as 45% women, 10% Black, 14% Hispanic/Latine, and 19% queer, we bring different lived experiences and perspectives to biotech.
Discovering a company’s business case for DEI is a valuable endeavor, but it requires the same vigor given to a product roadmap or revenue growth strategy to uncover the opportunities and align with the business.
Ultimately, it comes down to building inclusive and equitable workplaces where the most diverse and talented employees can thrive, not simply survive. Unfortunately, not enough companies trust that a focus on DEI will foster a competitive and revenue-driven edge by getting the most out of their greatest asset: their people.
Trier Bryant is a 17-year DEI and people executive and former United States Air Force captain. She currently sits on the board of directors of the Athena SPACs and serves as president of 82VS, the venture studio of Alloy Therapeutics.
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