A barren tree right leaning in a sandy desert.
29th January 2024

Corporates can outpace the politics on DEI

but only by holding focus on the long-term.

DEI has become a lightning rod for America’s disagreements over what constitutes progress. UK corporates can lead by example if they accept that success will require careful organisational change rather than just funding and the desire to do the right thing.

The US was the birthplace of the modern push for diversity, equity and inclusion (DEI) in western economies. Is it also where the movement died?

For many, the death of George Floyd in 2020 was a reawakening, but DEI has since become a lightning rod for an entire nation’s disagreements over what constitutes progress. Recent Supreme Court decisions to end Affirmative Action in college admissions and strip away some LGBTQIA+ rights might merely be low points in a debate that will have many peaks and troughs – but influential voices including Janice Gassam Asare are already tackling the question as to whether Diversity, Equity and Inclusion “is officially dead”.

The UK perspective is a little different. The topic isn’t as contentious, but unhelpful rhetoric is creeping into our political discourse. The recent “crackdown on rip-off university degrees” is a good example of a political view that measures the value of education solely by earnings after graduation, with little regard for the socio-economic benefits that higher education can provide.

The UK “has much more to do to make Britain more equal,” the Equality and Human Rights Commission said in May, as it highlighted policy gaps in healthcare, pay gap reporting and the treatment of ethnic minorities by uniformed services such as the Metropolitan Police.

The corporate world has done a better job of maintaining progress on DEI, but many firms find themselves buffeted by the issues of the moment. Hiring of chief diversity officers in the US jumped 169 per cent between 2019 and 2022, according to LinkedIn data cited by the FT. That same metric fell back 4.51% over the past twelve months and looks set to keep easing.

UK data isn’t readily available, but anecdotally I’ve seen a similar trend. Organisations have turned their attention to other areas – primarily disability and women’s health issues, particularly support in returning to work after pregnancy and some help with childcare costs.

One of the important lessons of the past three years is that organisations struggle to balance what they view as competing issues. Whether it’s DEI or the various issues that come under the umbrella of environmental, social and governance (ESG) frameworks, too often well-meaning leadership teams reallocate funding and staffing based on the latest advice from a set of disparate internal boards/committees.

This is no way to tackle deep-set, long-term issues. DEI and ESG advisors must communicate, and organisations need integration if they are to become more resilient. Recognising how these issues are interrelated is an important next step for organisations that now have budget in place to make progress.

Retention of staff suffers if an executive board isn’t diverse and inclusive or if teams don’t feel that they have equal opportunity, for example. Funding to tackle climate change will in many cases be felt most in urban, more deprived areas that are more susceptible to air pollution and have less green space. None of these issues can be properly tackled in isolation.

So, in the UK, at least, DEI is far from dead, but the period of hope that characterised 2020 to 2022 has eased, and the complexities of making real progress are becoming clearer. Complex issues that require funding and commitment at a political level are never straight forward, and organisations have now been exposed to the reality that progress will require careful organisational change rather than just funding and the desire to do the right thing.

Those that embrace the process will be the more resilient to the difficult economic conditions that we face today.

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