The business case
Diversity and inclusion improves excellence in execution and risk management, and it gives strategic advantage. It improves execution by enabling better problem-solving; it’s an early warning system for bad decision-making. A healthy D&I culture refines risk identification and dissipates groupthink. In terms of strategic advantage, it boosts employer brand, is a strong countermeasure to poaching, and it allows companies to attract and retain the entire talent pool and not just a part of it. It increases client engagement, client loyalty, access to new markets and networks, and encourages better-targeted services and product design.
But the business case needs to be built individually for each company. Each company has its own culture, its own leadership style, its own employee experience, and its own make-up in terms of people. You cannot take what happens in one company, pick it up, and dump it in your own company. A blueprint doesn’t work. You have to understand your own organisation holistically – how it works, why it works that way, the weak spots and the strengths. What is the culture? It’s not just the numbers. The numbers are a tool and a baseline indicator, but they cannot be a goal in themselves.
We should really be focusing on inclusion – if you have a truly inclusive culture, diversity will naturally follow. The prime goal is really to develop an ‘economy of belonging’, where people feel as if they belong.
One main barrier to companies achieving this is if the leadership has not bought into it and is not able to embed those principles and values within leadership behaviour. You get real change when the leadership actually lives the model. In Europe, diversity and inclusion is often losing strategic priority positioning; it’s being positioned as an HR topic rather than a business topic, and is sometimes pushed further down into talent development. Often in the US, diversity officers are sitting at the executive committee table and/or management board table, and reporting into the CEO.
The first thing an organisation has to do is to position the D&I initiative as a multi-level multi-year journey, and a cultural change strategy that has a clear link to the business, but which is driven and owned by the CEO. It needs its leadership to be ‘D&I eloquent’, so they can articulate what it means to them personally, and that needs to be reflected in their actions.
In-house legal departments can be a very powerful partner in diversity and inclusion, but they need the right training and the right education. Just as with senior leadership, you need their buy-in, their eloquence and their action.
The legal department can lead the way in terms of demonstrating good leadership, good people management skills, a strong sense of belonging and inclusion, and a heightened environment of trust and respect. It could clearly be the flag-holder for that. But I’m not necessarily seeing that yet. It starts with the head − so the general counsel has the potential to really be a driver of change. Their knowledge of the legal landscape certainly means that they have an understanding of parts of the discussion that other people don’t have, and if legal professionals are articulate and eloquent in diversity and inclusion, they themselves can raise awareness with the business leaders as they have the legal conversation.
The importance of sharing
I’ve seen organisations where the leaders think everything is fine but when they see the numbers they’re gobsmacked. In the area of gender, for example, leaders might be completely unaware of the extent of the drop-off from senior managers to middle managers in their female representation. They might think it’s 5%, but actually it might well be 30%, which is massive. The legal team could have a constructive dialogue with leaders around the risks of gathering, showing and sharing data, and have a balanced discussion around the benefits of working with that data instead of just saying, ‘No, you cannot see this data’.
Generally speaking, in-house legal departments tend to be better in terms of gender diversity, but not necessarily in respect of other types of diversity. Also, is that true along the entire hierarchical pyramid? Is that true at every management level? And do you have other systemic or unconscious biases in the department that you’re not aware of? That applies to other diversity groups as well. Are you only selecting lawyers that have gone to certain universities, or who worked for certain organisations? Do you have a bias towards certain nationalities or regions? How are you dealing with linguistic differences? Are you actually living inclusive values?
Role models are important, because the possibility of projecting yourself and your career within that organisation becomes incredibly difficult if you can’t see other people who have been successful that you can relate to.
Thinking outside your own organisation, if you start running a supplier diversity programme, you have potential to have huge impact on the broader economy. And I don’t think that should only be connected to numbers. For example, I sit on the global advisory council of EDGE [Economic Dividends for Gender Equality] and its certification is the global business certification standard for gender equality. It looks at representation, culture, policies and pay equity, and triages these different factors, offering different levels of certification. Something like that not only looks at numbers, but at culture.
The emotional power of belonging
Quite frankly, training is not getting us where we need to be. So the question is: how do you go beyond training to actually change the DNA of an organisation? I believe that D&I is at a crossroads, and to get to the next level, we have to broaden our lens and focus beyond behaviours, to access hearts and minds. We need to start looking at emotions in the workplace, and the emotional power of belonging is the vehicle for accessing hearts and minds. So we’re looking at how intangibles like loyalty, motivation, trust and leadership are key to excellence in execution. D&I is the key to those intangibles.