The study by Weber Shandwick, United Minds, and KRC Research also features the opinions of Chief Diversity Officers as well as guidelines for success.
Chief Diversity Officers state diversity and inclusion initiatives result in higher revenue and a greater reputation, according to a study conducted by Weber Shandwick in partnership with United Minds and KRC Research.
The online survey of 500 senior-level D&I professionals including 168 Chief Diversity Officers (CDOs) at major companies (with annual revenues of at least 500 million,) sought to evaluate the current D&I landscape in the United States. Responses were collected March 4 – 27, 2019.
Previous research has shown that a company with a high percentage of diversity amongst employees results in positive outcomes within the company. As a result, there has been a recent increase in the need for professionals that can lead D&I functions which align with an organization’s overall business strategy. Respondents answered questions to determine where their organizations fell along a D&I alignment continuum, which separated respondent organizations into three groups: “well-aligned,” “aligned,” and “misaligned.”
Diversity and Inclusion Alignment
According to the report, D&I professionals state:
- 39% agree that their company is “well-aligned.”
- 46% say their company is “aligned.”
- 14% classify their company as “misaligned.”
Results of “well-aligned” D&I professionals contribute to a likely high percentage of reward toward a company’s reputation and financial gain. A company needs to consider its profit from D&I trainings. McKinsey reports that roughly $8 billion per year is invested in diversity training in the United States alone. In fact, executives in “well-aligned” (66%), “aligned” (27%), and “misaligned” (12%) companies agree D&I contributes to high financial performance. Corporate Chief Diversity Officers say their biggest challenge is making a business case for Diversity and Inclusion. Respondents also expressed a need for increased alignment.
To increase alignment in the next 12 to 18 months, senior-level D&I professionals’ top priorities include D&I trainings and development within their organizations. Diversity and Inclusion professionals also plan to increase focus on recruitment, retention and fostering a diverse and inclusive work culture. These goals contribute to the business function of the company overall, thus it is imperative that CDOs communicate with the highest levels of the company.
Chief Diversity Officers of Today
Respondents shared insights regarding their experience and involvement with internal and external partners to accomplish D&I goals:
- 77% of CDOs were responsible for D&I in their previous job for an average of 7.8 years.
- 74% of these CDOs received their current position internally.
- Demographically, 57% of CDOs are Millennial white (60%) males (56%) with a bachelor’s degree or equivalent (82%).
- CDOs report to an average of 2.1 people including C-suite executives (69%) and the CEO (39%).
- CDOs, on average, meet with the CEO of their company once a month and ten times per year to their company board of directors.
- CDOs report to their three most important external partners to complete D&I goals. The three most important external partners include recruiters (56%), communications and marketing organizations (55%), and industry peers (53%).
D&I Functions Provide Business Advantages
On average, D&I efforts have an impact on new hires (30%) and resignations (13%). Executives in “well-aligned” companies have seen an increase in acceptances (33%) while “misaligned” companies experience lower rates of acceptances (24%) and the highest rate of attrition (15%). Dissatisfaction with company D&I efforts costs approximately $6.8 billion per month for U.S. businesses, according to Weber Shandwick.
Not only do the study findings prove that D&I functions contribute to a organization’s success, but a majority (79%) of Diversity and Inclusion executives in “well-aligned” companies agree that D&I is an essential driver of company reputation.
Chief Diversity Officers also detailed the following regarding business advantages:
- 44% of executives in “aligned” companies stated D&I is an essential driver of company reputation
- 30% of CDOs in “misaligned” D&I functions said D&I is an essential driver of company reputation
- 66% of executives in “well-aligned” D&I functions agree D&I is an essential driver of financial performance
- 27% of respondents in “aligned” companies say D&I is an essential driver of financial performance
- 12% of executives in “misaligned” organizations say D&I is an essential driver of financial performance
- 70% of D&I professionals in “well-aligned” functions estimate their work as “above average”
- 44% of respondents in “aligned” functions state their work is “average”
- 30% of respondents in “misaligned” functions estimate their work as “average”
Guidelines for a Well-Aligned D&I company
To establish a company that is “well-aligned” in diversity and inclusion, a company must:
- Appoint a D&I leader.
- Establish a direct connection to CEO.
- Include diversity from the top.
- Incorporate D&I into company culture.
- Align D&I to company’s business success.
- Merge D&I with marketing and communications.
The Future of D&I
Eighty-one percent of CDO participants in this study are incredibly optimistic about the future of D&I in corporate America. CDOs with “well-established” D&I programs emphasize the increasing importance for companies to have an executive responsible for Diversity and Inclusion. The future is bright for D&I, as 51% of CDOs predict most companies in the U.S will have a CDO position available within the next five years. It is imperative that companies leverage their D&I efforts if they wish to improve company reputation, employee retention and financial performance.
To see the full “Chief Diversity Officers Today: Paving the Way for Diversity & Inclusion Success” study, click here.
Olivia Kresic is the communications coordinator for the Institute for Public Relations. She is also a graduate student at the University of Florida, focusing her research in both public relations and health communication.
Tyler Kimble is a communications assistant for the Institute for Public Relations. He is also a junior public relations major with a concentration in education at the University of Florida.