A diverse workforce brings a variety of perspectives and ideas, which can lead to better decision-making, increased creativity, and improved problem-solving. It can also help the company tap into new markets and to better understand and serve its customers. In a workplace that lacks diversity, employees may feel a lack of inclusion and that they don’t belong or are not adequately valued. It can also foster a lack of understanding and awareness of different cultures and backgrounds, leading to misunderstanding, friction, or conflict.
A recent analysis by zippia.com, a career research company, published in July 2022, found that:
– Companies with diverse leadership teams in terms of race and ethnicity are 35% more likely to financially outperform companies with little or no diversity.
– Companies having a higher gender diversity among employees perform 15% to 21% better than companies with poor gender diversity.
– At least 67% of job seekers consider workplace diversity necessary when deciding the organization they want to work with.
Promoting diversity is a policy, a program, an intention — or a mixture of all three. It is a policy because it will have a set of guidelines or rules, and it is a program because it consists of organized activities aimed at achieving diversity. Moreover, it is an intention because it is a goal we hope to achieve through our actions. Some common types of workplace diversity would involve race, gender, age, religion, sexual orientation, and ability.
There are also monetary benefits that accrue due to diversity in the workplace. Companies with diverse workforces have been shown to have higher stock prices and better financial performance than those without diversity. Moreover, studies have found that companies with more women in senior leadership positions tend to have higher returns on equity. The relationship between a company’s finances and its workforce diversity can vary depending on the specific circumstances of each organization.
A company may hire a more diverse workforce to tap into new markets or improve its public image. Alternatively, a company may invest in programs to increase diversity within its ranks to boost morale and employee retention rates. Ultimately, the extent to which a company’s finances are linked to its workforce diversity will depend on various factors, including its business model, strategic goals, and prevailing cultural norms and values.
Last but not least, poor workplace diversity can result in a homogenous workforce not representative of the community, customer base, investors, or other stakeholders, which can limit creativity, innovation, and growth. By creating a workplace that values diversity and inclusion, everyone will be able to feel comfortable and respected, which will lead to a more productive and positive work environment. Thus, the business case for diversity in the workplace is very evident.