How Post-Covid Business Recovery Will Benefit From Diversity And Inclusion

It is now crucial to remain focused on diversity

The impact Covid-19 has had on life and business, as we know it, has been unprecedented. The new normal that businesses now find themselves facing is being one that needs to adapt and change on a weekly, sometimes daily. 

The most recent and impactful changes have ranged from ensuring your business is Covid-19 secure, to placing employees on furlough leave, through to instructing whole departments and sometimes whole organizations to work from home, rather than venture to the office. 
 

Yet, as these changes have unfolded, demanding a real-time response, HR and business leaders have also been faced with the challenge of maintaining a semblance of business as usual for the very areas of good people practice that truly matter. Those being the areas that count in making a huge difference to the ways in which organizational culture operates, enabling employee engagement and people performance to flourish.  

Diversity and inclusion has been one such area that until the emergence and unfolding of the Covid-19 pandemic, had gained a worthy focus and significant momentum. Yet, understandably, at least initially as the pandemic hit, regrettably the focus of attention has managed to lose its place in the priority list, whilst the impacts from the new normal have taken precedence. 

It is, however, the very impact of the pandemic that has demonstrated how hard inequality and inequity can affect people’s lives. Naturally, this effect extends to business operations and their diversity focus as well.

Why Focus on Diversity Matters

During a time of increased organizational crisis and uncertainty, as this time clearly is, performance and productivity are some of the first areas to be impacted. When people are operating from a place of fear, uncertainty and survival instinct, it’s understandable that performance in a role will be negatively impacted as a result. 

Yet the evidence of a correlation between business performance and diversity has been well researched and explored by a variety of well-respected business consultants and experts in human resources management. Where once again Mckinsey, the global consulting firm, well versed in their studies and advisory on diversity and the positive impact it has on organizational performance have reported how crucial the time now is to remain focused on the diversity agenda.

Their report, ‘Diversity wins: How inclusion matters’ is Mckinsey’s third addressing the topic and brings together their earlier analysis of diversity, inclusion and its benefits, published in 2014 and 2017. The findings of all three reports correlate to reach the same overarching conclusion that companies who have more women within their top teams outperform those with limited women in senior seats. And diverse teams, no matter where they are geographically located, or the sector the organizations are operating within, deliver better results.

Covid-19 and its Impact on Diversity Progress

The unfortunate result of the Covid-19 era we continue to find ourselves in is one where business leaders have, resulting from their focus on this unique set of circumstances, withdrawn their attention from the need to progress the diversity and inclusion agenda. 

Inevitably, attention has been placed in responding to the economic crisis at hand, which has led to HR professionals having to juggle, manage and contend with a multitude of challenges facing organizations in efforts to save jobs, ensure the effective continuation of operations and support employees, who may be facing personal, health and financial challenges as a result of the Covid-19 pandemic. 

As such, despite the clear evidence to support the prioritization of diversity and inclusion policy and initiatives, the attention on this area has shifted firmly by senior teams to one more concerned with business survival. The outcome of this shift in focus could be detrimental to the future progress of diversity.  

It’s worthwhile also considering that the UK Government itself has also halted initiatives that support diversity and inclusion, such as gender pay gap reporting, which has been suspended as a reporting requirement in 2020. As a result, the consensus on the decision to halt gender pay gap reporting, is that this, combined with coronavirus itself, could disproportionately affect women in the workplace. 

Prior to the Covid-19 crisis, gender pay gap reporting, initially introduced in 2017 mandated that organizations with 250 employees or more, must publish and report specific figures about their gender pay gap. This came as a result of a Government consultation on the gender pay gap and workplace equality which concluded in 2015. 

The objective of introducing this reporting was to increase transparency around pay and highlight the gaps in equality that could be identified by having access to the pay information of larger firms. And whilst organizations with less than 250 employees weren’t mandated to report on this in the same way, the practice was encouraged, highlighting the evident need to address gaps in pay, which were disproportionately impacting women at all levels of organizational hierarchy. 

The decision to temporarily place this reporting on hold could add further damage to women and their ability to progress at work. According to Sam Smethers, Chief Executive of the Fawcett Society, as reported in People Management magazine, “It will be mothers who will take on the majority of care for the children who are not in nursery or school.” It’s this impactful addition to women’s workload and work/life balance, that could add further detriment to career progression prospects, as redundancy rounds are contemplated. 

However, it’s absolutely vital that employers and business leaders don’t lose focus on their gender pay gap goals and diversity initiatives. Particularly, as the gender pay gap offers the best data available, at scale to indicate where in your organization diversity & inclusion initiatives are bedded in, and where they require greater focus.

How to Pursue an Inclusive Recovery

Focusing on equality, diversity and inclusion offers organizations the very best chance of recovery post the Covid-19 crisis period. Dame Helena Morrissey, the founder of gender equality campaign group, the 30% Club, and former CEO of Newton Investment Management, while speaking at the CIPD festival of work conference in 2020, made clear that “this is not just about equality and about treating people fairly, which is, of course, important in all of this, but it is about getting better creativity, the best thinking, about making the right decisions.”
And it’s through effective decision making in this area, whilst actively pursuing an inclusive recovery and recognizing that diversity and inclusion are necessities, that will engender far greater outcomes for recovery. 

The Mckinsey research found that companies with more than 30% of women on their senior executive teams are significantly more likely to outperform those organizations with between 10% and 30% women at the top. 

In addition, organizations need to also acknowledge that focusing solely on short term financial recovery without a focus on diversity and inclusion, will in the long term be detrimental to employee engagement, employee brand, the ability to attract and retain top talent and the bottom line, in the long term. 

It’s not enough to focus on D&I only when times are good in business, this moment of collective crisis is calling on human resources professionals to articulate the link between diversity, inclusion and the strategic aims, outcomes and objectives of the company during this all too crucial time. 

Through the use of effective data as a starting point for decision making and action, leaders can not only affect good decision-making on people management, linked to the Covid-19 crisis but also make strategic decisions relating to D&I that the organization can learn and grow from. 

Reporting capability of an HR software greatly enables HR and business leaders to draw insights, conclusions and trends from historical data on diversity and pay reporting, that will help to predict future needs and behaviors. Using the HR dashboard, HR business partners can easily measure the percentage improvement of workforce productivity, whilst determining causes and understanding the impact on costs, and financial performance. 

Using data to incentivize managers and business leaders to create inclusive cultures, where diverse talent can be attracted, developed and retained is vitally important to organizational success, making the adoption of a solid HR management software solution so beneficial to organizations embarking on their inclusive business recovery journey.

Bringing it All Together

Recovery for organizations, businesses and indeed individual livelihoods must continue to be at the forefront of the post-Covid-19 recovery strategy. And yet, the critical consideration for organizations is how they can combine these all too urgent focuses with the matter of diversity and inclusion, which should remain as high a priority in the efforts to bounce back from the coronavirus crisis. 

The data on why a strong D&I focus should rank highly in your organization’s priority focus speak for themselves. However, should resistance be encountered, then your leadership team perhaps yourself directly if you’re a business leader, can find comfort in knowing that by focusing on diversity and inclusion at this critical moment in your plans for recovery, you’re sowing the seeds for sustainable growth and increased resilience, that will last far beyond the Covid-crisis. And that’s good news for everyone, all around.

Jade Taryn Graham is Founder of Inspired Talent.co. Jade is a contributing writer for Sage HR and shares her knowledge on people, process and strategies to improve the world of work. Follow @SageHR Connect Sage HR