The increase in the use of equal opportunity officers, or Chief Diversity and Inclusion Officers (CDIOs), is significant. Over the last ten years, we’ve seen more chatter, and more real talk, about the need for diversity in our workforce and the importance of including input from all types of employees. Generally, these are considered positive ideals to the extent that they represent our geographic area or that of our customers. The U.S. Census Bureau predicts that the majority of the United States will be people of color within 25 years. That shift in demographics points toward an ongoing shift in the prospective employee base and prospective customer base.
It also means that the bulk of white males in the C-suite will soon be in the minority. For those executives striving to improve leadership and decision-making for the benefit of a company, it might mean hiring a CDIO. More than half of Fortune 500 companies now employ some sort of person dedicated to diversity and inclusion strategies, whatever the title might actually be.
But is company improvement really the reason to hire such a position? After some well-publicized sexual harassment issues, it certainly can look like hiring a CDIO is a band-aid to stop the bleeding caused by unfavorable media attention, or to make a CEO look good without any real infrastructure in place to support a person in such a position. Fortune posited that people hired into such positions are doomed to fail, with little hope of making inroads into diversity and inclusion.
To make the position work, we must consider the goal. It could be the goal of specific ratios that reflect recruitment populations. It could be a cultural shift that improves workplace teamwork among diverse groups. But it should definitely include a goal of diverse and inclusive ideas in order to make a real contribution to company progress and profitability.
What this Job Looks Like
Well, that depends on the company itself, and anyone can view data on salaries and general responsibilities. But like any job description, outlining skills and responsibilities takes some attention to definitions and details.
First, diversity. Diversity is the range of a group’s characteristics. This is difficult to fully define within any community because diversity incorporates all elements of individuals. While most legal protections call out gender bias, race, age, and religious preferences, there are many other categories that impact a person’s view and identity. Many are social categories like whether or not they are parents, convicts, immigrants, far-sighted, homeowners, etc. Each affects the individual’s voice and priorities. The point is that we each belong to multiple social groups, many of which are difficult to define but that are present (or missing) in the workplace.
Next, inclusion. Inclusion is a bit different from diversity. While a diverse organization will have broad characteristics in its employees that represent a broad population, inclusion means proactively including the myriad, diverse groups with respect. When a CDIO creates an inclusive workplace, that person successfully ensures equal access to opportunities and, more importantly for the organization’s success, to the inclusion of ideas that represent the diverse social groups that impact a company’s region and customer base.
Can a CDIO Be Effective?
We don’t have a CDIO at our company, and while I think that our client base is broad, we are located in Fargo, ND. I myself am an immigrant, but you can probably guess at the diversity challenges we face in such a locale. Add to that the overwhelming statistics nationally, and while we strive to be inclusive and diverse, there are numerous challenges in the workplace.
At the top levels, the nation’s labor pool is not reflected except in rare instances. A small percentage of Fortune 500 CEOs are female or people of color. And pay gap statistics are still dismal. These are obvious and easy-to-see challenges. For a CDIO, the objectives are tough ones and, perhaps, nearly impossible. So, can a person in such a position be effective? We think we want to fairly represent qualified individuals from all groupings, and we definitely want it to make sense for the business.
In hiring and developing a CDIO position, the business aspect still must be paramount. Organizations that can afford it may choose to invest in diversity and inclusion even if it costs some profits initially. But few companies can stomach long-term expenditure for little return. For a diversity officer to be successful, the structure must provide the candidate some teeth in his or her methods. To accomplish this, the person must report directly to the CEO who must, in turn, be dedicated to making positive steps toward inclusion. Each layer of management must be accountable to their own goals as part of the business’s identity and organization success.
Unfortunately, one of the most common roadblocks for companies is the lack of data available to them. Either they don’t have enough information on their own employees, recruitment, customers, or demographic regions to make informed and effective decisions, or the information is not made readily available to a CDIO. As the C-suite develops room for another C-level leader, transparency and access to critical information must also be a priority to help ensure success.
Boards are also instrumental to the success of inclusionary practices and change. As the gatekeeper for company direction and shareholder value, the board must measure a corporation’s performance. When a diversity officer’s objectives are entwined with board oversight, the chances of measurable improvement are greater. Well-structured, the goals extend significantly beyond hiring practices and HR guidelines to contribute to bottom-line success.
Benefits to Effective Inclusion
I’ve read lots of different material on the value of CDIO positions. Some are quite negative and critical of the “face” and market share potentially saved by installing a diversity figurehead. However, I like the goal, and I’m impressed by the possibilities of such a position. CFO’s are driven by bottom-line performance, and there is good reason to make diversion and inclusivity priorities to help improve business performance.
In the United States, companies that increase racial and ethnic diversity on their BOD see a 0.8% increase in EBIT. Job candidates consider diversity important in their future employers. By doing what makes fiscal sense, our pool of qualified job seekers increases.
Growing a company comes in various ways, and new markets and customer types are valuable. Employees at diverse companies claim higher market share and a 70% likelihood of capturing a new market. And solid research found that companies with the highest levels of racial and gender diversity boast more customers along with higher revenue and profitability. Imagine if the inclusion of other social groups were also measured as carefully. It, too, would suggest the value of including intellectual ideas from multiple social groups, too. The total potential could be significantly higher.
The corporate cultural shift of bringing on a CDIO is not a small one. To be effective, it needs to be woven into the fabric of every department’s management objectives. As a top-down priority, it would reflect social responsibility while driving inclusionary measurements to business responsibility. The position can work well with a true internal commitment to increasing the bottom line while fostering diverse ideas from multiple sources. We must strive both for diversity and inclusion of ideas to responsibly manage our organization with greater and measurable success.
multicultural team -DepositPhotos