Bringing diversity to the workplace has become an imperative for businesses that want to be market leaders. A majority of Fortune 500 firms have a diversity officer in an executive role, and 90 percent of them have employee resource groups or similarly tasked internal programs that address the opportunities and challenges of a workforce reflecting differences in areas such as ethnicity, age, gender and sexual orientation.
No wonder. Cultivating diversity makes solid business sense. Among the potential benefits when your employees mirror the world around them: an increase in creative solutions, an expansive perspective that better serves target markets and internal benefits that include an edge in recruiting talent.
Let’s not forget the potential financial payoff. A 2015 report from a top global management consulting firm found that companies with diverse executive boards have higher earnings and return on equity; those in the top quartile for racial and ethnic diversity are 35 percent more likely to outperform those in the bottom quartile; and those in the top quartile for gender diversity were 15 percent more likely to report similar success.
That said, diversity alone may not be enough. Many organizations also embrace the concept of inclusion. Think of it this way: What’s the point of recruiting people to join your team if they spend most of their time sitting on the bench, watching from the sidelines? Market leaders are leveraging diversity by embracing an inclusionary mindset that includes:
- Valuing the breadth of their employees’ diverse backgrounds and experience
- Respecting different points of view, which mirror the larger world of their customers
- Actively engaging and empowering employees to make business contributions
A two-year study of more than 450 global companies reported a high correlation between strong business performance and an inclusive talent system. These firms reported higher cash flow, nearly twice the rate of innovation in their respective markets, and a business culture that was more change-ready and adaptable. Diversity and inclusion can help make a business competitive, viable, relevant and profitable.
With significant demographic changes forecasted over the coming decades, diversity will increasingly influence both our personal and professional worlds. The companies that will profit most may be the pioneers ready and willing to embrace the future now and, in doing so, help maximize the potential of their own futures.