More Companies Take Diversity and Inclusion Seriously, Research Says



Diversity is no longer just an empty corporate buzzword with little by way of strategic importance. It’s a subject companies are taking more seriously to bolster business.

Almost three-quarters of human resources practitioners (72 percent) see diversity and inclusion as a strategic enabler for their companies’ business strategy, according to a 2015 survey from Human Capital Media Advisory Group, the research arm of Talent Management magazine.

Meanwhile, 14 percent said diversity is a necessary but expensive contributor to the business, while 14 percent view it as a cost center (Figure 1).


More than a third (40 percent) of respondents consider diversity and inclusion critically important to business success, but where exactly the diversity and inclusion function lies is less certain. The diversity leader position and the department they operate under vary by company, the survey shows.

The diversity and inclusion function is more often a subset function within another department than a stand-alone department, according to the survey. About a quarter of the companies surveyed (23 percent) don’t have a diversity and inclusion function.

Some companies (34 percent) don’t have a specific role for the person in charge of diversity and inclusion, according to the survey. About 26 percent of respondents said in their firms, the vice president or somebody in HR is responsible for diversity and inclusion; 9 percent said they have a chief diversity officer or executive; and 6 percent said they have another executive, such as a CEO, in charge of diversity.

Companies that do have a head of diversity and inclusion are mostly likely to report to either the chief human resources officer (24 percent) or CEO (22 percent).

Moreover, nearly 60 percent of respondents said HR is the most common department for diversity and inclusion, while talent or workforce management is the second-most popular. Respondents were less likely to report diversity as being part of learning and development or marketing.

For most organizations, the diversity and inclusion strategy is mostly targeted toward employees. About 70 percent of respondents said their companies target entry-level employees with diversity and inclusion, while about 67 percent target midlevel management, and 63 percent said they target leadership, the survey showed. Fewer target customers, clients, suppliers and external partners (Figure 2).


Employers measure diversity and inclusion by tracking employee demographics. About 92 percent of respondents said their firms track diversity according to gender, 88 percent said they do so by ethnicity or race, and 85 percent said they do so by age. Less common segments include groups differentiated by sexual orientation (31 percent), gender identity (28 percent) and religious affiliation (19 percent).

About half (55 percent) of the companies surveyed said diversity and inclusion metrics are reported to the senior leadership team. Almost a third (30 percent) said this was true “to some extent.” About 15 percent said they do not report these metrics to senior leadership.

It is common for leaders of the diversity and inclusion function to review these measurements less frequently, according to the survey. For example, 42 percent of the leaders surveyed track race or ethnicity metrics annually, 28 percent said they did the same monthly and only 9 percent did the same weekly.

The same pattern emerges with other employee segments. Just fewer than half of leaders track employee gender and age annually, while a much smaller percentage said they did so monthly.

To increase diversity, many companies create annual targets to improve representation. About 77 percent of companies have targets for race or ethnicity, 71 percent have targets for gender, and 41 percent have targets for veterans. Less common are quotas based on gender identity (3 percent), religious affiliation (2 percent) or familial status (1 percent).

About 74 percent of the companies surveyed said they have specific diversity and inclusion programs for employee segments based on race or ethnicity, while 64 percent said they do for gender and 38 percent said they do for veteran status. Fewer companies said they have these programs for gender identity (23 percent), national origin (19 percent) or religious affiliation (4 percent).

Additionally, 62 percent of companies surveyed offer cultural competency training or sensitivity training, 58 percent said they incorporate community outreach as part of their programs or strategies, and 52 percent said they have diversity councils.

Some companies also set targets to increase diversity outside the company.

About half of the companies surveyed target diversity in their suppliers at least “to some extent.” About 85 percent said they do this by seeking out minority-owned businesses, while 77 percent said they do so by seeking out female-owned business (Figure 3).


Meanwhile, about 50 percent said they seek out veteran-owned businesses, 43 percent said they seek out businesses owned by people with disabilities, and 24 percent said they seek out LGBT-owned businesses as outside suppliers.

Companies also set targets to increase diversity in their suppliers. About half said they have specific programs to improve supplier diversity.

The survey, conducted last September, collected data from 158 organizations of varying sizes and industries. Half the companies are from the private sector, and more than a third (39 percent) have diversity and inclusion budgets of less than $100,000. Roughly 43 percent of the respondents in the survey are director level or above.

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