56 Business The EconomistNovember 9th 2019
2 Or are you hoping that diversity will
boost the bottom line? To be perfectly hon-
est, I have no idea if it does. It is hard to tell
if diversity helps firms do well, or if suc-
cessful firms are also more enlightened on
other matters. But variety has been linked
to innovation, productivity and, for exam-
ple in diverse teams of surgeons, fewer
mistakes. Lack of it breeds groupthink—
which in turn can lead to disasters. The Bay
of Pigs invasion and the Lehman Brothers
collapse stemmed from narrow-minded-
ness. And employees who believe their
firm cares about gender diversity are 40%
more likely to be satisfied at work—and
possibly more productive as a result.
Once you have sorted out the why, con-
sider where you want to get to. Some firms,
like Facebook, Nike or p&g, say they wish
to mirror their customer base. Others are
keen not to recruit from an artificially thin
talent pool. Goldman Sachs claims its new
entry-level recruitment targets—50% fe-
male and, in America, 14% Hispanic and
11% black—are based on things like gradua-
tion rates. Clear goals make it easier to as-
sess if you are on track. But make them at-
tainable. Qantas’s goal of 40% of its pilot
intake to be female by 2028 is as admirable
as it looks unrealistic: today just one in 20
pilots worldwide is a woman.
The third question concerns barriers
that stop diverse talent from flourishing at
your firm. Mapping how it flows through
your organisation and where the blockages
and leaks happen is a start. A McKinsey
study of more than 300 companies identi-
fied the second step of the career ladder,
from entry level to manager, as the “broken
rung”: for every 100 men only 72 women
(and just 68 Hispanic and 58 black ones)
earned that critical early promotion. When
Google was losing women in dispropor-
tionate numbers it homed in on maternity
as the principal cause; the technology giant
increased maternity leave and support for
mothers returning to work.
Staff surveys can help, provided they are
large and comprehensive enough. After its
#MeToo moment, Lloyd’s, an insurance
market, found that 45% of staff felt unable
to raise concerns about improper conduct.
Employees are now encouraged to speak
up, including through a bullying-and-ha-
rassment helpline. A “culture dashboard”
tracking progress on survey metrics will be
published with the Lloyd’s annual report.
Now you’ve got your diversity-and-in-
clusion priorities straight and diagnosed
what needs fixing. Good. Before you order a
rainbow float for a Pride parade and send
staff on a micro-aggression avoidance
course, here is what not to do.
American firms spend billions a year on
training. Half of large ones have uncon-
scious-bias seminars. Most of these “d&i”
programmes are a waste. Or worse: recent
research from America shows that diver-sity statements can put off minorities, pos-
sibly because they perceive them as token-
ism. Often, firms do dbut forget i, which is
about ensuring that the workforce is not
just diverse, but thriving. Too many try to
fix people instead of procedures. Training
women to be more assertive in asking for a
promotion or pay rise is pointless; they are
just as likely to ask for these but also likeli-
er to be seen as pushy when they do. Usher-
ing your managers onto the “Check Your
Blind Spots bus”, currently touring Ameri-
ca as part of the ceos’ drive, is unlikely to do
much. “Days of understanding”, popular in
American offices, risk causing “diversity
fatigue”. It is hard to beat bias out of indi-
viduals—easier to root it out of systems.The don’ts
Take Silicon Valley. Big Tech has splurged
on d&ito little effect. Representation of
blacks and Hispanics has been flat (see
chart). Girls Who Code, an industry-spon-
sored ngo, found that a quarter of young
women who applied for internships at tech
firms said they were asked inappropriate or
biased questions. Others reported being
flirted with or demeaned. It’s no use hiring
diverse coders if the message then is: wear
a hoodie and pretend to be a guy, or this is
no place for you. They will underper-
form—or flee, leaving you as undiverse as
before. Firms that do not change their ways
beyond recruitment see high attrition rates
of diverse talent. A lack of diversity is a
symptom of deeper problems that a few
diversity hires won’t mend.
At this point the how should be relative-
ly clear. In a nutshell, it is all about creating
a level playing field. When recruiting, soft-
ware can mute biases by concealing give-
aways to a candidate’s gender or ethnic
identity. These include names but also less
obvious hints like the sports they play. Ifonly the usual suspects apply, look harder.
Specialised recruitment drives, such as vis-
iting “black” colleges or advertising in
women’s forums, appear to work. The Bank
of England no longer visits the Russell
group of top universities, whose graduates
apply in spades anyway, and focuses in-
stead on less elite schools. bhp, an Anglo-
Australian mining giant, broadened its
search for female miners by recruiting
from professions, such as nursing, with
some similar skills.
In an effort to find trainees from differ-
ent backgrounds, British law firms are try-
ing “contextual recruitment”. An applicant
with Bs from a school where everyone got
Cs may be more impressive than one with
As from a place full of A* pupils. Rare, a re-
cruitment firm, has developed software
which screens candidates for disadvantage
and gauges their outperformance against
the average for their school.
Once in the workplace, the clearer your
criteria for professional advancement, the
better. Informality is the enemy of women
and minorities. It perpetuates bias. Sur-
veys of American engineers and lawyers
found that female workers were nearly
twice as likely as their male peers to be sad-
dled with “office housework”, like setting
up meetings and conference calls. White
men were likelier to be given career-
enhancing tasks such as client meetings.
Sponsorship schemes are an effective
way to ensure traditionally sidelined
groups get a fair shot. PayScale, a pay-com-
parison site, found that employees with a
sponsor made 11.6% more than those with-
out. The Bank of England has offered most
of its sponsorship places to ethnic-minor-
ity women. Staff surveys, if bite-sized but
regular, can bring clarity to fuzzy inclusion
metrics. “Psychological safety”, lingo for an
environment where people feel free to
speak their mind, can be tracked with ques-
tions like “are your ideas regularly attribut-
ed to someone else?” or “are you regularly
interrupted in meetings?” Rotating who
chairs a meeting, or a firm word with loud-
mouths who dominates it, can help.
Many employers—yourself included—
would be horrified to learn that they im-
plicitly require employees who want to be
considered leadership material to adjust
their behaviour. Women shouldn’t need to
“act like a man”, gay employees to “act
straight” or people with frizzy hair to treat
it to “look professional” (ie, white). Let
grievances fester and your workers will
lose motivation or simply leave.
That is a lot to take in. But unless you do,
your most valuable resource—workers—
will not be as good as it could be. Best to get
ahead of the problem. It isn’t that hard. And
it can pay off mightily.Yours,
Shareholder 7UndisruptedSource:Company reportsUnitedStates,companyleadershipbyrace,%GoogleFacebookApple0 20 40 60 80 100
20142019White Asian Black Hispanic
Native American Multiracial/undeclared2014201920142018