Diversity and Inclusion: No time like the present
Covid-19 has exposed gender gaps in the labor force of developed and emerging markets. And while positive change is being seen around the world, driven by socially conscious investors, clients as well as the employees themselves and their organizations, much more work needs to be done before corporates and their boardrooms can be called truly inclusive.
Like many other key issues of our time, diversity, or the lack of it, has been thrown into focus by Covid-19. While companies around the world have been working to incorporate diversity and inclusion into their practices for some time now, the pandemic has brought home the need for urgent action by exposing how unequal our societies are.
Indeed diversity and inclusion are no longer viewed as merely social issues but are being recognized for what they actually stand for: building blocks for long-term economic prosperity. And as with other areas of ESG investing, which has seen a sharp uptake in recent years, the pandemic has prompted growing numbers of socially conscious investors to scrutinize and reward companies that do well on diversity and inclusion metrics. In fact, Credit Suisse research findings suggest that stocks of companies with diverse workforces have outperformed their peers in markets like North America and Asia.
Yet, according to Iris Bohnet, Albert Pratt Professor of Business and Government, Academic Dean, Harvard Kennedy School, and Credit Suisse Group Board member, the world has a long way to go in addressing the challenge of promoting equity in the workplace and ensuring the post-pandemic recovery is a truly inclusive one.
The pandemic effect
While organizations the world over have done very well in helping their employees cope with the pandemic by being flexible and allowing them to work remotely, there are still gaps in our understanding of how practices like work-from-home are affecting working women, Bohnet observed, adding: “Only time will tell if the pandemic has long-lasting effects on our work lives but I hope we can learn from all the lessons that it has taught us.”
Further, sectors that typically employ female workers, such as retail, hospitality and travel, have been particularly badly hit, and there is a need to understand exactly how this is impacting the participation of women in the workforce, according to Bohnet. As large numbers of women have left the labor market - in the US alone, millions of women are estimated to have become unemployed and left the workforce - the phenomenon has become so widespread that it has earned its own term, ‘shecession’.
Analyzing these trends and their impact on all employees, especially women and mothers, will help us better understand how to build productive teams, Bohnet said. Similar gaps are seen to exist in our understanding of the pandemic’s impact on frontline workers, another segment employing significant numbers of women. Then there is the informal economy, which is rarely talked about and harder to measure, but employs large numbers of ethnic minorities and other underrepresented groups.
“These are people in the labor force that we may have taken for granted before. It’s now time to ask some hard questions and rethink our ways of handling them,” Bohnet said.
Be the change you want to see
So what can be done to really move the needle? It’s all about identifying what works and what doesn’t, according to Bohnet.
Good leadership makes a difference. “Company leaders need to walk the talk and be role models for their organizations and the world. Leaders should also make the effort to examine their systems so they can be rid of the negatives,” Bohnet said.
Getting people’s buy-in is seen as particularly crucial so they can act as “micro-sponsors.” Bohnet explained what this means with an example: “If you see a woman colleague being overlooked in a meeting and not getting credit for her inputs, speak up to acknowledge it. Unfortunately, this is a scenario playing out in too many offices. Take it upon yourself to help equalize the workplace, because even small actions can have big impacts,” she urged.
Systemic change for systemic issues
Bohnet believes that organizations must focus on interventions that bring about systemic change to help root out the many biases inherent to organizational practices. For instance, this could mean going beyond diversity training – which can help raise awareness but will not solve the problem – and changing the way companies pay, hire and promote people.
Acknowledging that large operational changes can take time to implement, she suggested: “Even small, inexpensive tweaks to the system can yield huge returns,” adding: “We have to use data wherever we can to debias our systems, and constantly keep learning and re-evaluating.”
Encouragingly, there is a lot of positive change happening already. In Asia, countries like Singapore, Malaysia, Indonesia and the Philippines are leading the way, Bohnet noted. However, North Asian countries such as Japan and South Korea continue to lag behind.
Another area long overdue for improvement, according to Bohnet, is the representation of women on company boards. “Why is it that we have such low representation of women on company boards when other areas of female participation in the corporate world is quite impressive in so many countries?” she asked.
To be sure, it’s not all about gender, Bohnet clarified. Ultimately, true diversity is all about ensuring we’re inclusive of anyone in the minority, because: “All humanity must be a participant in the exercise of building back better. We need the diversity of perspective that people of different genders, backgrounds, ethnicities, nationalities and professional disciplines can provide. And if you want to compete in the global economy today you cannot afford not to be benefiting from 100% of the talent pool.”