Is Diversity a Business Imperative?

As a Diversity and Inclusion Practioner, I am often asked what ‘Diversity and Inclusion’ means and what my work entails. I usually have a standard answer, “We look at hiring people from various backgrounds – gender / ethnicity / physical ability / sexual orientation / age et al – experiences and perspectives. We also work towards building an environment where everyone feels included and empowered to contribute towards the overall success of the business.”

After my little “gyan”, I then get asked isn’t workplace diversity a virtuous business effort like CSR or employee wellbeing – the right thing to do! By this point my patience is usually wearing thin. The problem is this “right thing to do” is never at the top of the agenda in the boardroom. There are too many other pressing matters that need to be taken care of, rather than moving the focus to issues that are beyond hard-core operations.

However, it is only now that organisations feel the need to look at workplace diversity as an imperative to improve the bottom line. Having clearly defined strategic goals and targets around diversity will have a direct link to quantifiable business results.

One would think in the Indian workplace, Diversity and Inclusion would be looked at from a different lens and not just another initiative that we have to implement because of a mandate from our western parents. India is arguably one of the most diverse countries in the world, with as many as 22 official languages, 29 states – each with its distinct traditions and cultures, from a population rich with diverse religious faiths, customs to attire. India has long embraced this diversity and the principles of ‘equal opportunity’ and ‘inclusion’ are 2 pillars of the Indian Constitution.

Diversity and Inclusion is an issue that India as a society has struggled with for a long time. Many feel there is a large gap between the aspirations of the Constitution makers and reality. The legacy of the caste system and a growing divide between urban and rural areas mean gross inequalities exist in terms of access to opportunities – education, employment, health and wealth. At the same time, deeply entrenched cultural beliefs – like the role of women in the society or the inclusion of People with Disabilities – have prevented huge sections of the population from contributing towards the nation’s holistic social and economic development.   

Over the last decade, the topic of diversity has attracted increasing attention of the Indian corporate sector. Recognising the business case for diversity, large multinational companies, with expanding operations in India, have been keen to explore how to apply and adapt their global diversity principles to their local businesses in India. Indian companies too are taking interest in this topic. Keen to compete on the global stage, leading local organisations are looking to up their game when it comes to embracing different perspectives and harnessing the contribution of all to drive business success. In addition to this, changing dynamics in India – rural to urban migration, growth and influence of the younger generation etc. – are providing impetus for Indian companies to put diversity and inclusion on their corporate agenda.

The directive of the new Companies Bill of 2013 has further put light on the role companies have to play towards supporting the communities in which they operate and ensuring greater inclusion of the most disadvantaged in the society. Having at least one woman director on board or developing skills of people in marginalised communities are two aspects of the Bill. Although forecasts estimate the gender gap won’t close until 2133, many companies are taking significant steps towards building a workplace that is devoid of unconscious bias prejudice in hiring and promotion.

So, why are companies finally starting to realise diversity is no longer a “programme” to be managed but a business imperative? What’s making companies move from looking at diversity as compliance to a business strategy? Let’s examine some reasons:

• Access to top talent and clients: By looking at a diverse slate when hiring, companies will have the opportunity to recruit top talent from a globally diverse marketplace. In order to become an employer of choice, thus being able to attract the best people, a company has to ensure it showcases diversity across all levels. In today’s increasingly transparent world, when prospective employees and clients do their research, they want to get feeling of “fitting” in to the work environment.

• Employee Engagement: Employees will feel valued when their contributions will have an equal opportunity to develop. An environment where employees can thrive as individuals or as members of a team can be a big boost to motivation and productivity.

• Talent Retention: An environment where employees feel accepted, valued and challenged is somewhere they would likely stay longer at. Retaining and developing its talent is an opportunity for a business to grow and also reducing staff turnover. 

• Diversity of thinking and collaboration: When organisations broaden their understanding of diversity to focus on, in addition to, gender, race, age and physical ability, diversity of thinking. This means getting value out of people’s different perspectives and different ways of reaching solutions. In this increasingly complex global world, looking at diversity from this angle will help an organisation see value and take cognizance of risks associated with homogeneity. Diverse teams are more innovative and will perform at higher levels.

• Company Reputation: A company that promotes workplace diversity and inclusion will be more favourable for businesses as well as customers. A company’s reputation plays an important role in its success – a company with a strong programme for hiring diverse talent, recognition and acceptance can improve internal and external stakeholder relations. A diverse workforce will ensure opportunities to create a diverse customer base.

Although diversity at the workplace is a wonderful thing, it also challenges many of today’s business leaders. For managers and team members, it can be difficult to navigate in a truly diverse workplace made up of people of different cultures, races, creeds, body types, hobbies, genders, religions, styles and sexual orientation. But understanding cultural and social differences is a major key to a high-performing, merit based work environment. In the global marketplace, it is important than ever that we understand and are conscious of our differences to work together effectively. We all bring our conscious beliefs and personal narratives about who we are and who others are with us to work and, with diversity in place, we can no longer ignore them. Truly effective leaders cannot pretend that we are all the same or that our preferences and preconceptions don’t exist.

Legislation can lead to a surface oriented diversity, wherein the numbers look good on paper, but the culture remains unchanged – what matters is results! In such an environment, the only change takes place within the minority individuals, who may likely “adopt the behaviour and attitudes of the existing organizational culture”. Improving diversity “in a statistically objective sense” matters, but leaders must also elevate an organization’s internal “perception of diversity”.

Diversity is not a recruitment campaign, but a strategy where high performing organisations recognize that having a diverse workforce doesn't only meet compliance targets, but allows them to tap into diverse perspectives and approaches employees bring into the workplace, which eventually leads to solving complex and challenging business issues. While many organisations are taking note of the importance of having a diverse workforce, many others are still at early stages of the journey in understanding that diversity is a business strategy.