Diversity & Inclusion identified as a key driver of business performance and talent attraction, but more investment is needed

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Diversity & Inclusion identified as a key driver of business performance and talent attraction, but more investment is needed

The vast majority (94%) of Irish business leaders believe that an inclusive environment is vital to business performance, however there remains a lack of gender, race, ethnicity and LGBT diversity at senior management and board level.

In addition, a significant proportion of organisations are not investing in Diversity & Inclusion (D&I), according to research published today at the InMotion Conference held in the Mansion House Dublin by professional services firm EY.

The research was conducted amongst over 100 senior leaders across a range of indigenous Irish and global multinational organisations, including CEOs and senior management within HR functions. It found that the majority of executives believe that D&I contributes to attracting and retaining the best talent (97%) and that it is vital for business performance (94%).  Despite this, only half (50%) have a D&I strategy in place and less than a third (31%) have set D&I goals and targets within their organisation. Coupled with the fact that 53% of organisations do not measure D&I progress and success, this reveals a significant disconnect between the importance companies’ place on D&I as a business imperative, and their actions which do not reflect this.

Speaking at the event, Olivia McEvoy, Director and Head of Diversity & Inclusion Advisory Services at EY Ireland said: “Our research reveals that while there is an overwhelming consensus among respondents that promoting Diversity & Inclusion is vital to accelerating business performance, actual work practices do not reflect this view which may be explained by limited investment and know-how. However the tremendous response to the survey suggests businesses are aware that they need to do more. This report provides a benchmark for the key pillars of a successful D&I programme, including strategy & governance; data collection and analytics; leadership; and resources and responsibility, to establish what needs to be done in order for Ireland to become a country which promotes workplaces that are truly diverse and inclusive.”

“The fact is that integrating D&I into business strategy is no longer a ‘nice to have’ but it is a must if companies want to compete for the best and most engaged talent.”

Investment pays dividends

Critically, 63% of respondents said that their D&I strategy and reputation have helped them to acquire and retain talent, while a quarter (26%) attribute higher sales revenue and profit margins to their D&I strategy and its implementation. However, while a high proportion of companies surveyed believe that D&I is a business imperative, just over a third (35%) said say that they spend less than €1,000 a year on Diversity & Inclusion – amounting to under €20 per week. This underscores the need for buy in at a senior level so that resources and funding can be allocated to initiatives which support D&I.

Mike McKerr, Country Managing Partner, EY Ireland commented: “Our research has confirmed that investing in D&I pays dividends – companies with a D&I strategy not only have enhanced reputations but they also report even higher sales revenue and profit margins. This makes it even more critical that businesses develop and implement a D&I strategy that works for them, otherwise they will pay the ultimate price and fall behind the competition. It's all about leveraging our differences which will lead to higher employee engagement, superior client service and in turn   better business results.”

Lack of diversity at the top table

The survey also found a striking lack of diversity in the race, ethnicity and gender of boards, with 76% comprised of men – highlighting that women also hold less than a quarter of the places at the top table (24%). However the news is better in relation to senior management, where females fill approximately 33% of positions – 8% higher than the current global average. 

Furthermore, only 11% of boards have members who are LGBT and a further 8% have members with disabilities.

Steps businesses can take

Currently the majority of businesses in Ireland don't refer to D&I in their reporting, however this will change in the future with the arrival of a new EU directive which will require certain Public Interest Entities to disclose information relating to environmental and social matters including the levels of diversity within their board of directors.

Olivia McEvoy added, “It is clear that this is an area that needs investment and commitment in order to unlock the many benefits. However, companies should not feel they have to do everything at once. A successful D&I programme is very much a journey and as such, companies should allocate resources so that they can start by assessing where they are now on this journey, and gather and analyse their D&I data before developing and implementing a strategy that will work for their business. An informed and enabled leadership team must then be equipped to really drive the agenda and to model inclusivity.”

Article Published: 28/04/2017