Keep Your DEIB Promises — Especially in an Uncertain Economy

In the summer of 2020, it seemed as if all of corporate America was trying to make their companies more diverse, equitable and inclusive. As Black Lives Matter protests swelled on city streets, hate crimes against Asian Americans spiked and antisemitic and xenophobic incidents grew, businesses across the country announced major donations to racial justice organizations, set goals for hiring people from underrepresented groups and committed to addressing unconscious bias and microaggressions in the workplace.

Three years later, economic uncertainty is prompting some business leaders to reprioritize and simplify their strategies, which is having a disproportionate impact on DEIB commitments. “DEIB efforts are being pushed further down on the agenda or being taken off altogether,” says Misty Gaither, vice president of DEIB+ at Indeed. 

According to Indeed Hiring Lab and Glassdoor’s recent Hiring and Workplace Trends report, Glassdoor reviews of employer DEIB programs dwindled in 2022, after surging in 2020 and 2021. Meanwhile, according to Indeed data, between March 2022 and March 2023, the number of Indeed job postings for DEIB roles also dropped by 42%. These DEIB jobs are still more plentiful now than they were in 2020, but the steep decline over the last year suggests DEIB efforts have been on the chopping block as companies look to cut costs and refocus. “When you start to divest in DEIB at the first sign of economic hardship, for me, it actually sends a signal that the efforts were performative and never considered integral into the overall business strategy,” Gaither says.

Maintaining your DEIB commitments when times get tough isn’t just possible; it’s crucial to decision making, employee recruitment, retention, product innovation and your go to market strategy. And that means repositioning the work and reframing the concept of DEIB, especially after historical approaches have been largely ineffective. Here are four key strategies for getting it right.

Focus on Policies and Processes, then Programs

The wave of donations and hiring initiatives inspired by the racial justice protests of 2020 were undoubtedly important. But even more important than any single program or partnership is embedding DEIB into the infrastructure of your company, which means reviewing policies and processes to make them equitable and inclusive of all people. That way, if you need to scale back on spending, your core commitment to DEIB will remain intact. 

“Stop committing to action, and start committing to outcomes,” says Lily Zheng, a DEI consultant and author of the book DEI Deconstructed. Zheng offered the example of a company that rolls out a flashy external speaker series as the cornerstone of its DEIB efforts, then scraps the series when funding is limited, jeopardizing its reputation with both existing employees and potential recruits. “Now, this is seen as them compromising their entire DEIB program, because this initiative has become the only thing they have,” Zheng says.

A sustainable approach that addresses the systemic and structural bias is working to enhance or incorporate equitable policies and practices across the company. Every phase of the employee lifecycle presents an opportunity for bias to creep in — hiring, promotions, calibrations, promotions and special projects. Other policies that are not people focused in nature should also be included. Consider the demographic composition of teams who are building products, like UX researchers and data scientists. 

“Why not take a look at your hiring practices? Why not look at how you are promoting all of your employees?” Gaither says, noting that, in some ways, periods of uncertainty can actually present an opportune moment for doing just that. “These are things that are low to no cost to perform, and should be done on a regular basis as the business grows and evolves.”

Invest in Mid-level and Senior Leaders

The investment in visible representation in senior leadership is key, specifically for women, and women of color. But lately, progress on that front has also slowed. In 2022, the number of women being appointed to S&P 500 boards grew just 5%, compared to an 8% jump the year before. Megan Wang, CEO of theBoardlist, an online talent marketplace that connects companies with potential board members, attributes that change to the fact that companies facing financial pressure might seek out people with CEO and CFO experience, roles that have not traditionally gone to people from diverse backgrounds. 

In the push to diversify their ranks, major employers from all industries have teamed up with historically Black colleges and universities to find promising young talent. While investing in campus recruiting is valuable, there is also a talent gap at the mid to senior level, specifically with racial ethnic minorities. 

These leaders don’t just bring more diverse networks with them, says Will McNeil, CEO of the tech job board Black Tech Jobs. They can also serve as sponsors and mentors to the younger generation of talent that is not well represented within your organization.  “I'm not saying you kill your internship programs,” McNeil says. “But if you have $1 to spend, don't spend 90 cents there.” Instead, McNeil recommends adjusting budgets so more money is allocated to hiring mid- to senior-level leaders.

Ultimately, Wang says, increasing representation on boards is about securing your company’s financial position. One recent study by Crunchbase and the social impact venture firm Him for Her found that companies that have at least one woman on the board have raised an average of 16% more money than companies that don’t. This suggests that, at least in investors’ eyes, these companies are in a much stronger position.

“The reality is, DEI is fundamental to making better decisions,” Wang says. “It's not a separate initiative.”

Rethink Return to Office Mandates

The fluctuation in the economy has prompted some CEOs to rethink their remote work policies and call employees back into the office. But Gaither and others warn that could have damaging impacts on DEIB efforts. “Data continues to illustrate that for people from marginalized communities, they can't always be their authentic self at work,” she says, noting that some company leaders believe bringing people back to the office will foster a sense of community. “My question is: Community for who?”

In fact, one 2021 study by the research group Future Forum found that 97% of Black knowledge workers in the U.S. wanted to work for a fully remote or hybrid workplace, compared to just 79% of white knowledge workers. 

Recruiting for remote positions has also been shown to improve the diversity in the hiring process. According to 2022 data, the availability of remote job listings led to an uptick in female, Black and Latino applicants between 2019 and 2022. It has also led to an increase in the share of applicants from those categories being offered and accepting roles.

Zheng says companies should think hard about requiring employees to return to the office full time. “Companies are falling back on their old playbooks, ignoring everything we've learned from the last five years, which is that flexible and remote work enormously benefits marginalized communities without, by the way, hurting people from majority groups,” Zheng says. 

Remember, DEIB Work Isn’t Philanthropy. It’s Good Business

The most important advice is to remember that an investment in DEIB should be considered a core tenet of your business strategy, not something adjacent to the operations and a charitable cause. The business case for building a more diverse and inclusive company is clear: McKinsey researchers have found for years that more diverse companies outperform their industry peers, and in 2020, McKinsey found that the relationship between diversity and financial performance has only gotten stronger. That study found that companies in the top quartile for gender diversity on executive teams were 25% more likely to be more profitable than average companies in their space. 

“Diversity, equity and inclusion is more than celebrating heritage months, it is a business imperative that improves the health and well being of organizational culture,” Gaither says. “It drives innovation, can mitigate risks to your reputation and contributes to the competitive advantage of a company.”