The Future of Diversity, Equity, Inclusion and Belonging 2023

Maintain the momentum of DEIB during times of uncertainty

In light of recent social justice movements, corporations have responded by making bold statements and pledging money and efforts towards diversity, equity, inclusion and belonging (DEIB).^{1, 2}

Real change toward equity requires more than just diversity programs. It often requires a paradigm shift in the way businesses are run and deep cultural change that can be extremely challenging to achieve. Also, with the growing mobility of people across the globe, DEIB must be viewed through a different lens depending on varying cultural contexts.
 

To better understand the complex topic of DEIB, HR Research Institute conducted a study entitled, The Future of Diversity, Equity, Inclusion and Belonging 2023.

Key Findings

• DEIB in most organizations is immature and initiatives are seen as ineffective.
• While HR is responsible for DEIB in the majority of organizations, two-thirds spend just 20% or less of their average workweek on DEIB-related work.
• Organizations aim to build a culture of trust through DEIB initiatives but are hampered by a lack of time and leadership support.
• Organizations increasingly rely on basic workforce data to measure the current state of DEIB.
• Roughly half of the organizations are actively invested in understanding pay equity.
• Under two-fifths of organizations offer DEIB-related learning & development (L&D) programs to all employees.
• Organizations use specific DEIB initiatives infrequently and rely on benefits to incentivize equity-deserving groups.
• DEIB leaders outperform laggards on several dimensions of prioritizing, measuring, and implementing DEIB.

Has DEIB Made Progress Over the Last Year?

We asked respondents to rate the effectiveness of DEIB initiatives in their organizations on a 10-point scale from perfectly effective (10) to extremely ineffective (1). Just 6% rate themselves an 8 or above and an overwhelming majority (86%) rate themselves a 6 or below. In fact, more than half (52%) rate themselves very poorly (4 or below).

The poor effectiveness of DEIB initiatives can be tied back to the lack of maturity of the DEIB function in organizations today. Just 6% say DEIB in their organization is at the expert level where it is an integral part of the culture and intrinsically linked to strategic goals of the organization. Just one in ten organizations say they are at the advanced stage where they have a strategic framework and utilize metrics.

More than a third place themselves at the intermediate stage which means they have some DEIB initiatives, but they lack strategic importance and there is no measurement of success. A lack of strategic importance of DEIB is likely to curb investments in the form of time and money and this will have a negative impact on effectiveness.

Are Women and Ethnic/Racial Minorities Represented at Leadership Levels?

Our results indicate that women represent less than 20% of top leadership in one-third of organizations, and another quarter say women represent just 21% to 40% of top leadership. Just one-fifth of organizations are women dominated, with women representing 61% or more of top leadership.  
The under representation of women is overshadowed by the dismal proportion of racial/ethnic minorities in top leadership positions. A vast majority (73%) say not even 21% of their top leaders are ethnic/racial minorities. In fact, just 13% say ethnic/racial minorities represent 41% or more of their top leadership.

Should HR Be Solely in Charge of DEIB?

HR plays quite a pivotal role in DEIB in many organizations. In about half of the organizations, the HR department as a whole (25%) or a specific team or person within the HR department (21%) is primarily responsible for DEIB issues, programs and/or policies. However, in about a quarter of organizations, the responsibility falls on the DEIB function, either the Chief of DEIB (14%) or the DEIB department (12%).

When asked about the connection between HR and the DEIB function, a third say there is no DEIB department, function or representative in their organization. This means that DEIB is either non-existent or is taken on as an additional responsibility by HR professionals.

Is DEIB Today All Talk and No Action?

Roughly a quarter stress DEIB in the talent acquisition process (25%), consistently communicate the importance of DEIB throughout the organization (23%) or include DEIB-related training during onboarding (22%) to a high or very high degree. Even fewer say they are embedding the topic of DEIB in all or most talent development materials (12%), have a formal budget allocated to closing pay gaps (13%) or take action on DEIB analytics (12%).

Do Organizations Understand and Prioritize Equitable Pay?

Remedying pay equity gaps first requires understanding it. Only half of the organizations say they are actively investing in understanding the pay equity gap in their business/industry to a high (34%) or very high (20%) extent. Slightly fewer are invested to a moderate (38%) or low (8%) extent.

Measuring gaps in pay among employees of comparable jobs (81%) or within the same pay bands (79%) is a popular technique since it is a straightforward way to uncover pay inequity. However, pay gaps also arise from inequity in pay progressions and pay for performance. This means that not just the recruitment team must be trained in DEIB to hire employees at equitable pay, but training must also be given to supervisors and managers who are in charge of performance management and pay progression recommendations.