Compilation of Diversity & Inclusion “Business Case” Research Data
This is a follow-up post from the “If your boss is still asking about the “business case” for diversity, your company’s in trouble” article
Here’s all the data you need to put together the D&I “business case” pitch deck. For the love of sweet baby goddess, stop wasting your precious time doing research that’s been done too many times before.
Business Case for Diversity and Inclusion
1990: Harvard Business Review published “From Affirmative Action to Affirming Diversity” in which it stated, “In business terms, a diverse work force is not something your company ought to have; it’s something your company does have, or soon will have. Learning to manage that diversity will make you more competitive.”
1991: The Academy of Management published “Managing Cultural Diversity: Implications for Organizational Competitiveness” and concluded managing diversity gives organizations a competitive advantage.
2009: American Sociological Association published “Diversity Linked To Increased Sales Revenue And Profits, More Customers” and shared their incredible finding that “companies reporting the highest levels of racial diversity brought in nearly 15 times more sales revenue on average than those with the lowest levels of racial diversity.”
2010: Kellogg School of Management published “Better Decisions through Diversity” in which it linked heterogeneity to innovative ideas and better team performance.
2013: Deloitte published “Waiter, is that inclusion in my soup?” in which they tied diversity and inclusion to better business performance (83%), responsiveness to customer needs (31%), and team collaboration (42%).
2013: Center for Talent Innovation published “Innovation, Diversity, and Market Growth” in which it found that publicly traded companies with 2D diversity (exhibiting both inherent and acquired diversity) were 70% more likely to capture a new market, 75% more likely to see ideas actually become productized, and 158% (no, that’s not a typo) more likely to understand their target end-users and innovate effectively if one or more members on the team represent the user’s demographic.
2014: Deloitte published “From diversity to inclusion” in which it stressed the importance of both diversity and inclusion in building high performing organizations and called diversity a business imperative: “And this means that diversity is no longer a “program” to be managed — it is a business imperative.”
2014: Stephen Frost, in his book, “The Inclusion Imperative” notes that “discriminating against women, homosexuals, and disabled people is costing $64 billion dollars a year in the U.S. alone.”
2015: McKinsey & Company publishes “Why Diversity Matters,” in which it notes that “Companies in the top quartile for racial and ethnic diversity are 35 percent more likely to have financial returns above their respective national industry medians,”
2017: Deloitte’s Global Human Capital Trends report shows the rising priority level of D&I among executives compared to previous years. Over two-thirds of executives rate D&I as an important issue while 38% of executives report their CEOs (not HR) being the primary sponsor of D&I initiatives. The report also highlights the alarming reality gap which shows most companies’ D&I maturity levels being “very low.”
2017: Boston Consulting Group (BCG) revealed its research that shows companies’ “Total Societal Impact” has proven to be a statistically significant in creating a reliable growth path, a reduced risk of negative, even cataclysmic, events, and, most likely, increased longevity.
2017/2018: McKinsey & Company released another set of research findings that once again confirmed the statistical significance of having gender- and race-based diversity leading to better financial performance. It reminded the reader that “Creating an effective inclusion and diversity strategy is no small effort and requires strong, sustained, and inclusive leadership. But we, and many of the companies we studied, believe the potential benefits of stronger business performance are well worth it.”
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About Michelle Kim
Michelle is an entrepreneur, activist, speaker, and writer passionate about empowering individuals and organizations to create positive change. She is the Co-founder and CEO of Awaken, a leading provider of experiential and modern Diversity & Inclusive workshops and Modern Manager™ training.