ARTICLE
21 December 2022

Three Key Reasons Why DEI Initiatives Fail

HB
Hall Benefits Law

Contributor

Strategically designed, legally compliant benefit plans are the cornerstone of long-term business stability and growth. As such, HBL provides comprehensive legal guidance on benefits in M&A, ESOPs, executive compensation, health and welfare benefits, retirement plans, and ERISA litigation matters. Responsive, relationship-driven counsel is the calling card of the Firm.
Although high-profile racially charged incidents in recent years have led to a surge in corporate pledges and investments toward diversity, equity, and inclusion, the forward movement toward these goals has stalled.
United States Corporate/Commercial Law
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Although high-profile racially charged incidents in recent years have led to a surge in corporate pledges and investments toward diversity, equity, and inclusion (DEI), the forward movement toward these goals has stalled. DEI leaders who have spearheaded this diversity work have focused on three key reasons why well-intentioned DEI initiatives have failed.

Failure to Explicitly Connect DEI Objectives to the Organization's Mission, Vision, and Values

DEI initiatives tend to be reactive strategies in response to public relations problems rather than long-term strategies designed to effectuate change. Part of the problem with achieving any significant changes through DEI initiatives is the inability of organizations to tie DEI solutions to corporate values. Leaders have no clear vision about how DEI initiatives should impact their organization's bottom line. For instance, tracking the impact of DEI on employee turnover and innovation could help leaders understand the importance of integrating DEI strategies into all aspects of their organizations.

Organizations should strive to adopt values that prioritize DEI and create a company culture that reflects inclusivity and belonging. Rather than vague statements about the promotion of DEI in general, companies must identify and articulate specific steps and actions to achieve a sustained DEI culture and community.

Lack of Sustainable Support from Leadership

Current leaders also may lack the personal connections or competencies necessary to advance DEI initiatives. While these leaders may be highly effective in the subject matter of their jobs, they often lack knowledge or understanding of the social realities that affect marginalized groups. Leadership development and coaching are critical to developing the competencies necessary to lead DEI initiatives to effectuate real change.

Leaders also must be aware of and willing to alter systems that traditionally perpetuate pay inequity and stifle diversity. Inept salary reviews, poor succession planning, systemic discrimination, unchecked implicit biases, and other challenges women and minorities face in attempting to ascend the corporate ladder continue to stall DEI initiatives. Without leaders willing to educate themselves and actively find strategies to subvert these issues, DEI initiatives will not succeed.

Absence of a Cohesive Strategic Approach to Integrating DEI into All Aspects of the Business

Truly effective DEI initiatives are incorporated into every aspect of their operations, from how the company conducts business to how it treats its employees to how it represents its values to the community within which it operates. DEI initiatives do not exist within a vacuum or fall solely within the purview of one department. Instead, DEI should be a part of every product the company develops or new advertising campaign upon which it embarks. Only the intentional integration of DEI with every aspect of business will set an organization on its way to making true progress toward its goals.

HBL has experience in all areas of benefits and employment law, offering a comprehensive solution to all your business benefits and HR/employment needs. We help ensure you are in compliance with the complex requirements of ERISA and the IRS code, as well as those laws that impact you and your employees. Together, we reduce your exposure to potential legal or financial penalties.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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