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Is DEIB the key to building a sustainable workforce?

While businesses have made great strides in creating a more inclusive workplace for all, is DEIB still relevant in challenging times?
While businesses have made great strides in creating a more inclusive workplace for all, is DEIB still relevant in challenging times?
15 May 2024 •

Over the last decade, Diversity, Equity, Inclusion, and Belonging (DEIB) have become critical themes in today's corporate landscape. From unconscious bias training programs to restructured hiring processes and newly implemented policies and resources, organizations have made great strides in creating a more inclusive workplace.

Companies have begun to recognize DEIB as a tool that yields undeniable benefits for organizational health and growth. However, cost-cutting and short-term profitability seemingly undermine the long-term benefits of DEIB in challenging and uncertain times, posing significant risks to workforce sustainability as companies shift DEIB low on their priority list.

A CNBC report in 2023 revealed a concerning trend that organizations were scaling back their commitment to these values. Layoffs of DEI staff, reductions in support for diverse employee resource groups, curtailed learning and development initiatives, and drastic budget cuts for external DEI groups were observed across tech giants such as Google and Meta.

As companies strive to build resilient and sustainable workforces, the question arises: Is DEIB a dispensable part of one’s organizational business strategy?

What is DEIB?

DEIB encompasses a comprehensive approach to creating an inclusive and equitable workplace in response to structural and social inequities. Here's a closer look at what each term represents:

  • Diversity: The representation of a wide range of identities, including race, gender, age, sexual orientation, ethnicity, ability, and other characteristics.
  • Equity: Ensuring fair treatment, access, and opportunities for all employees, often by addressing systemic barriers and providing additional support where needed.
  • Inclusion: Creating a culture where every individual feels welcomed, valued, and able to contribute fully to the organization.
  • Belonging: The sense of being a valued member of a community, where employees feel accepted, included, and integral to the organization's success.

While the core principles are generally understood, how these concepts are interpreted and implemented can vary across organizations and cultures. For instance, the patriarchal history and culture that many Asia Pacific (APAC) countries experience has shaped the region’s DEIB discourse and guided companies to prioritize bridging gender gaps. As such, companies in the region commonly focus on increasing female leadership roles.

Ultimately, DEIB works toward creating an inclusive workplace for all individuals, regardless of their identities and backgrounds.

Not just Corporate Jargon

In recent years, the concept of DEIB has gained traction in APAC, as a survey across 13 Asian markets in 2024 showed that more than 70 percent of private and publicly listed organizations have adopted pay transparency practices.

Though still a nascent topic in APAC, the advantages of DEIB are clear: a diverse workforce leads to increased creativity, innovation, and problem-solving as different perspectives come together. This is crucial in industries like logistics and supply chain, where increasing efficiency across every step of the supply chain, from cataloging and warehousing products to managing field delivery personnel, planning efficient vehicle routes, and tracking movement through technology are paramount.

According to Gartner’s 2021 “Women in Supply Chains” survey, women now comprise an average of 41 percent of the supply chain workforce.
According to Gartner’s 2021 “Women in Supply Chains” survey, women now comprise an average of 41 percent of the supply chain workforce.

Employees and businesses alike reap the benefits of a healthier workforce. Employees who feel valued and respected are more likely to be engaged and committed to their roles. This leads to lower turnover rates and higher productivity.

According to a Gallup report, employees who feel connected to the culture are 3.7 times more likely to be engaged at work, 68 percent less likely to feel burned out, and 55 percent less likely to be looking for new jobs. Similarly, a McKinsey study found that companies in the top quartile for ethnic diversity outperformed those in the fourth one by 36 percent in profitability.

With driving factors like regulation and compliance, as well as stakeholder expectations, organizations in the region are recognizing that DEIB is a powerful tool.

Not a magic pill

Token mentions of DEIB in mission and vision statements are not uncommon today. However, it is an entirely different challenge for businesses to embody these values in their daily operations. Approaching DEIB as a utopian ideology does not always translate into lived experiences for employees.

While the drivers above often nudge organizations in the right direction to embrace DEIB, organizations often fall into the major pitfall of thinking of DEIB as a one-time cure-all rather than a continuous journey and push for improvement.

As such, hasty execution without a deep understanding of what DEIB entails is a common stumbling block. Rather than a meaningful commitment, DEIB programs can quickly become a checkbox exercise as part of a compliance requirement, or new bells and whistles in a publicity stunt.

Even with good intentions, organizations can still make serious blunders or struggle with poor implementation, leading to the failure of their diversity programs. A Gallup study in 2022 found that only 31 percent of employees believe their organizations are committed to improving racial justice or equality.

Underscoring the disparity between leaders' intentions and employees' perceptions, only a quarter of these employees felt that issues of race and equity were openly discussed at their workplace. Prescriptive approaches of forced training and courses to stay compliant lack genuine acceptance,  building resistance to teachings and creating a barrier for employees to absorb information. Research has overwhelmingly shown negative messaging in Diversity and Inclusion training doesn’t help, and could hinder inclusion efforts, as people naturally tend to rebel against enforcement.

When DEIB is reduced to expected employee behaviors and formalities, companies will have to deal with adverse side effects of disengagement, attrition, and even a toxic workplace culture which pose significant dangers to workforce health in the long run.

Moreover, the people-centric nature of DEIB adds a layer of intricacies, as organizations grapple with measuring results that are difficult to qualify. For instance, companies could set and meet diversity quotas but fail to create an inclusive employee culture. Companies could even slip into tokenism and undermine the essence of DEIB in the process.

Crucial to an evolving workforce

As globalization continues to connect economies and markets worldwide, the global talent pool is becoming more flexible with remote working options, and people becoming more open to migrating for work opportunities.

Based on numbers from the World Migration Report, there were about 281 million international migrants in 2021, a 27 percent increase compared to 2010, when there were 221 million migrants who had made cross-border travels.

Apart from high immigration rates, higher birth rates were also observed among minority ethnicities, creating a more multicultural demographic in cities such as New York, London, and Melbourne. This has led to more children from various racial and religious backgrounds being trained in various industries from a young age, nurturing a diverse pool of talent in competitive industries as second and third-generation immigrants enter the workforce.

While more women are joining the supply-chain workforce, few of them are reaching higher leadership positions, with women representing only 23 percent of VP-level positions in the average supply chain organization.
While more women are joining the supply-chain workforce, few of them are reaching higher leadership positions, with women representing only 23 percent of VP-level positions in the average supply chain organization.

Companies are also expanding their operations internationally, necessitating hiring talent from diverse cultural and linguistic backgrounds to navigate global markets effectively. This opens up opportunities to embrace new talents in the workforce. For instance, despite persisting pay disparities, safety concerns, and discrimination, more women and minorities are joining the supply-chain workforce, signifying an untapped potential for businesses.

In multi-ethnic nations like Singapore, which have increasingly global labor pools, failing to address inclusion and equality may bring considerable repercussions as talented employees look for workplaces where their differences are valued instead. In 2022, Singapore’s labor attrition rate averaged 19.6 percent, and the average employment tenure was only 1.5 years compared with 12 years in Japan.

This is costing companies in terms of recruiting, onboarding, and training, suggesting that employee disengagement and attrition could cost a median-size S&P 500 company at least US$228 million (€211.5 million) a year in lost productivity.

To maintain a competitive edge, businesses must invest time, energy, and resources to build a conducive environment for their employees.

However, there is no single foolproof treatment as the conversations surrounding DEIB are constantly evolving. Results cannot be expected without consistent, authentic, and proactive efforts.

Instead of seeing DEIB as another bandwagon to jump on, companies must adopt an intentional, tangible strategy in implementing DEIB initiatives. Beyond mere hiring practices, it is crucial to integrate DEIB into every aspect of the business.

While classroom training lays the groundwork and acts as an initial building block to increase awareness and create a shared understanding of DEIB principles in the organization's context, there must be a well-thought-out application to put those learnings into practice. Dr. Poornima Luthra, a noted expert in talent management and DEIB studies, cautions that organizations "have to address bias and ensure the talent pipeline moves up with the same DEI lens as it had during the recruitment phase."

Carrying forward this same care and consideration in career progression and succession planning facilitates the sustainability of DEIB initiatives. Setting DEIB-specific goals and a continual assessment and fine-tuning ensures that the principles of DEIB are woven into the fabric of the organization’s daily operations and demonstrate a genuine leadership commitment in the workplace.

By integrating DEIB into every aspect of business strategy, companies can create a resilient, productive, and inclusive workplace. This shift allows DEIB initiatives to move beyond mere compliance, becoming a driving force for innovation, employee engagement, and overall business success.

Ultimately, a deep-seated dedication and nuanced understanding are required at the management level to start and maintain a trickle-down effect that moves the needle. True progress happens when the employees are encouraged to bring DEIB principles to their work, thereby turning the workplace into a more compassionate and productive environment.