The Business Case for DE&I

As 2023 draws to a close, we reflect on the DE&I discussions Armstrong Wolfe has engaged in over the past year. Armstrong Wolfe is committed to the promotion of Diversity, Equity and Inclusion in the financial services sector, and with the 2024 launch of our Ad Centrum initiative, it is discussions like these which we aim to bring to the fore.

The importance of a robust understanding of the Business Case for DE&I, and of the careful management of Data and Metrics in underpinning and supporting DE&I programmes, cannot be understated. Our aim is to discuss the practicalities behind these and a range of other DEI topics and look at industry best practices to provide actionable guidance and advice for professionals in a business-conscious context. In discussing the Business Case for DE&I, we have taken the first step in the process, which our 2024 programme of fora and discussions will build on. What follows is a summary of our discussions about the Business Case and the importance of Data and Metrics.

The ‘business case’ for a robust Diversity, Equity, and Inclusion (DEI) program is grounded in tangible performance enhancements. DEI programs have been shown to drive innovation by incorporating a wider array of perspectives and problem-solving tactics, stemming from a diverse workforce and the diversity of thought that brings when allied with inclusive working practices. Companies with a strong DEI focus are better positioned to understand and serve an increasingly diverse customer base, leading to improved customer satisfaction and market share.

Moreover, they tend to outperform their peers in terms of financial returns, as diversity can also translate to a variety of cognitive approaches and leadership styles that contribute to better governance and decision-making. In terms of talent acquisition and retention, DEI initiatives are critical; they create an environment where all employees can thrive, thereby attracting top talent and reducing turnover costs. On a global scale, making the case for DEI is even more compelling as it aligns with the universal drive towards greater corporate social responsibility and the Sustainable Development Goals (SDGs) of the United Nations. Multinational companies, by implementing effective DEI programs, not only signal compliance with global norms but also embrace a universal language of inclusivity, fostering goodwill and sustainable practices across all operations, which is increasingly demanded by global stakeholders.

Healthy working culture is a key component of diversity, as it creates an environment where different voices are not only heard but also valued. It acts as a beacon, attracting a multitude of talents from various backgrounds, perspectives, and skill sets. In such a workplace, employees feel respected and empowered, which encourages them to bring their authentic selves to work. This inclusivity fosters innovation, as the dissemination of ideas from a diverse workforce leads to more creative solutions and approaches to problem-solving right through a firm. When employees with different life experiences and viewpoints collaborate, they challenge each other’s thinking, leading to a more robust strategic process.

For the organisation, this means a richer tapestry of insights that can enhance decision-making, drive innovation, and tap into new markets. Furthermore, a culture that celebrates diversity is often seen as a reflection of a broader societal commitment, enhancing the organisation’s reputation on a broader scale. The resultant diversity of talent is not just a metric to aspire to; it becomes a competitive edge in an increasingly complex and interconnected global talent marketplace.

While the business case for DEI is predicated on enhanced performance and competitive advantage, it is important also to consider the moral imperative, hinging on the principles of fairness, respect, and human dignity. Ethically, a good DEI program acknowledges the intrinsic worth of every individual and strives to rectify the historical and systemic inequities that have marginalised certain groups. It’s about doing what is right and just, irrespective of the bottom line. This moral aspect demands a commitment to DEI because it aligns with a broader societal progression towards equality and social justice.

It recognises that organisations, as microcosms of society, have a responsibility to foster an environment where opportunities are not bounded by race, gender, age, or any other form of identity. From a moral standpoint, DEI isn’t just about the enrichment of a company’s fabric; it’s a reflection of our collective values and the acknowledgment that everyone deserves an equal chance to succeed. Balancing the moral and business cases isn’t about trade-offs; it’s about understanding that a truly successful organisation is one that thrives not only economically but also contributes positively to the moral arc of the community it serves and about recognising that changes made to include one demographic groups are helpful to the entire workforce.

The COO plays a pivotal role in orchestrating DEI progress within an organisation, serving as a linchpin between the strategic vision and operational execution of DEI initiatives. The COO must ensure that DEI principles are woven into the very fabric of the organisation’s processes, from hiring practices to professional development. However, the COO must also be attuned to the unique cultural, structural, and market realities of their organisation. Each company exists within its own context, with distinct challenges and opportunities.

A global enterprise may need to address diverse cultural expectations and legal frameworks that alter in different geographical regions. The COO’s leadership in DEI should be both principled and pragmatic, advocating for systemic change while also recognising and respecting the individual nuances of the organisation’s mission, workforce composition, and stage of growth. By balancing these dynamics, the COO can champion DEI not just as an ideal to aspire to but as a practical blueprint for action that is tailored to the organisation’s specific needs and aspirations.

The Importance of Data and Metrics in DE&I Initiatives

Organisational culture plays a foundational role in influencing employees’ willingness to be candid in DEI surveys. In an environment where trust, respect, and inclusion are cultivated, employees are more likely to believe that their responses will be used constructively, without repercussions. Conversely, in a culture permeated with distrust or apathy, employees may withhold information or give skewed responses, fearing misuse of their data or potential backlash.

A positive and transparent organisational culture assures employees that their voices matter, that the information they provide is pivotal for genuine change, and that their individual identities and experiences are valued. Thus, fostering a good organisational culture is not just about ensuring the accuracy of survey responses, but also about affirming the organisation’s commitment to meaningful and sustained DEI efforts.

One way in which a commitment to the development of such a culture can be undertaken is by careful management of the timing and frequency of DEI surveys, as they are key in capturing a holistic and evolving view of an organisation’s diversity landscape. While collecting data when an employee joins provides a baseline, it captures only a snapshot of that particular moment, potentially missing out on understanding shifts and changes over time. Conducting surveys at regular intervals offers multiple benefits.

It allows organisations to track the effectiveness of DEI initiatives, understand changing workforce dynamics, and promptly address emerging issues. Regular check-ins also communicate to employees that the organisation’s commitment to DEI is ongoing and not just a one-time effort. In essence, while onboarding surveys set the initial benchmark, periodic surveys ensure continuous improvement, engagement, and alignment with DEI goals.

Language plays a pivotal role in framing and perception for surveys. Utilising words that evoke partnership and trust can foster a more open and inclusive feel to the entire exercise. For instance, opting for “share” instead of “disclose” can make the process seem less formal and more collaborative, suggesting a mutual exchange rather than a one-sided revelation. Carefully chosen terminology can ease apprehensions and convey a sense of respect, understanding, and care.

Banks should prioritise language that encourages participation, engenders trust, and underscores the organisation’s commitment to creating an inclusive environment where employees feel valued and heard. It can also be beneficial to display leadership by example, with executives in senior positions speaking openly about their participation in surveys, the benefits that they bring, and the goal behind them, in order to further encourage participation among employees.

Trust can be further engendered by being transparent about survey results, encouraging debate about survey results, and showing a link between survey results and organisational action plans.

Geographically, data collection nuances differ. Technical challenges aside, the type of data deemed important can vary by region. For instance, metrics which represent key issues and sensitive areas in one region may be lower down the agenda in another. Banks operating in multiple regions must remain attuned to these nuances. By understanding and respecting each region’s unique diversity challenges and priorities, banks can craft surveys that are both culturally sensitive and effective in addressing the specific needs and concerns of their diverse global workforce.

 Ad Centrum is committed to supporting the discussion of practical ways to work DE&I through organisations, in line with the collective thought of the broader Armstrong Wolfe DE&I Community. Our first Forum of 2024 will be taking place on 29th February, 14:00-15:15pm GMT/09:00-10:15am EST.  This Forum is open to all, and if you would like to attend, please email .