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The business case for diversity

Progressive employers have for some time been integrating equality and inclusion initiatives into core business functions, such as organisational strategy and talent management programmes. Organisations such as B&Q, BT, Sainsbury’s, Santander and McDonald’s have been working hard to push the inclusion agenda forward. They, like us, know that managing inclusive workplaces is good for business performance.

Over the last decade the ‘business case’ for diversity has steadily grown. A CIPD1 report set out the key business benefits for developing diversity orientated organisations. These include:

  • Greater access to different perspectives and sources of information
  • Greater understanding of customers 
  • Better communication with customers 
  • Increased legitimacy

Research conducted by the Work Foundation2 adds that effective diversity policies have been linked to high performance organisations and result in:

  • Improved performance 
  • Improved employer image 
  • Improved brand awareness
  • Improved ability to respond and change through creativity and innovation 
  • Innovative approaches to products 
  • Reflective diversity makes customers feel at home

This research stressed the link between diversity, inclusion and organisational performance, covering key viewpoints, including those of the employee, those of the customer and the performance of the organisation covering profits and productivity. Diversity and inclusion are no longer seen as nice things to do. Doing inclusion right is part of running an efficient organisation in 21st Century Britain.

And finally work undertaken by the CBI3 set out three key business drivers:

These include:

  • Increasing employee satisfaction, which helps attract new staff and retain those already there, reduces recruitment costs, and can increase productivity 
  • Understanding better how the company’s diverse customers think and what drives their spending habits, or how to access markets they have not previously been able to tap into so effectively 
  • Finding enough workers to fill skills gaps in areas with tight labour markets, where there are not enough ‘obvious candidates’ for the vacancies they have.

The ‘business case’ debate is now well rehearsed and it is generally accepted across the business world that diversity is a strategic enabler, ensuring competitive advance and positioning organisations as employers of choice.

1Anderson, T and Metcalf, H. 2003. Diversity: Stacking up the evidence, CIPD.

2Jones, A. 2006. Rising to the challenge of diversity: A discussion of the business case, The Work Foundation.

3Talent not tokenism (2008). CBI.