DEI trends 2024: preparing for the year ahead
29 Jan 2024
Meenakshi Krishnan, Principal Research Fellow
Economic headwinds, sluggish global trade, escalating regional conflicts, and a lingering cost of living crisis. As we begin 2024 under these challenging circumstances, what is the outlook for DEI programs in the coming year? Will organisations continue the momentum on DEI initiatives built over the past few years? Or will they cut back investments in the face of economic uncertainty and a noisy countermovement against diversity agendas?
To describe how I think the DEI landscape will unfold in 2024, let me describe to you how ocean currents work.
Wait, what do ocean currents have to do with DEI?
An ocean current is a continuous, directed movement of seawater generated by a number of forces acting upon the water. There are two types of ocean currents – surface currents and deep currents. Surface currents are driven by wind direction, position of landforms, and energy from the sun, while deep ocean currents are influenced by variations in density of water, temperature, and salinity. And of course, the occasional storm or earthquake can come along and shake things up a lot!
DEI actions are somewhat like these ocean currents – surface movements include cuts to DEI jobs, potential reduction in spending as economic outlook gets tougher, and visible modifications to DEI goals as conservative discourses sweep over from the USA.
But the deeper currents in DEI relate to core commitments to a culture of equality and inclusion, where companies recognise the fundamental value of having a workforce that mirrors their customer base, the need to access alternate talent pools, the importance of employee wellbeing, and the long-term financial and sustainable business advantage. For companies where DEI is a mere surface level tick box exercise, shifting trends might adversely impact investments. But organisations that are values-driven will not dither or reduce efforts to create equitable workforce strategies.
Detailed below are ways that these deeper currents within DEI will continue to shape the ebb and flow of activities this year:
1. Taking DEI beyond HR and embedding it into business strategy
In an economically tough environment, programmes and activities must align with business results to stay relevant. Passionate DEI officers and HR leaders have done a lot to set the organisational agenda, but now DEI must be seen as more than just a social or moral good. DEI delivers business value and dividends to the workforce, community and customers. Board members, business heads and functional/operational leaders need to reposition DEI not as an HR or people strategy but rather as integral to business growth and sustainability. There is need to develop a robust evidence base on how a diverse and inclusive workplace directly promotes business results and employee productivity.
2. Aligning DEI goals with talent acquisition strategies
In 2009, a BCG study revealed that women drive the world economy, marketeers rushed to address women’s concerns, that would ultimately deliver rapid growth. This coincided with a sharp increase in efforts to boost gender diversity on company boards and in the workforce. Today, hiring managers are grappling with skill shortages and uncertainty in the labour market, leading to increasing pressures to recruit and retain talented people. Older pools of tried and tested talent are drying up – contracting under the weight of ageing populations, lower birth rates, and changing technologies. Talent leaders are beginning to realise that attracting alternate talent pools means being sensitive to attracting and retaining diverse groups of the labour market. Labour market analytics and skills-based approaches will enable companies to strategically integrate DEI goals with talent acquisition and workforce planning.
3. Moving from target-based approaches to leadership diversity and commitment
It is common wisdom that ‘what gets measured, gets done’. Following this logic, setting targets for expanding representation of underrepresented groups seems like a good place to start to increase diversity. Additionally, holding managers accountable through KPIs and incentive plans was meant to drive these targets. However, this measurement focus has inadvertently (and counterproductively) created a culture of fear, anxiety, resentment, absence of ownership, and a lack of inclusion. According to a survey by Gartner in 2022, half of DEI leaders say their biggest challenge is other leaders failing to take ownership for driving diversity outcomes. Not only is leadership commitment critical, but leadership diversity is crucial too. The more diverse the top teams are, the more empathy and lived experience they can bring to their leadership and the wider organisation. Focusing on the diversity and commitment of senior leaders is an overlooked rung on the DEI ladder towards creating a more diverse and inclusive workforce and culture.
4. Shifting focus from representation to culture and employee wellbeing
Organisational culture is what we do, not what we say we do. Mere lip service or box ticking efforts cannot bring values of diversity, equity, inclusion, and respect to life. ‘Add DEI and stir’ mindsets will not work. DEI leaders must put people sustainability at the heart of business efforts, similar to environmental sustainability policies. Employers are beginning to see benefits of flexible working for a range of workers, including older workers, workers with disabilities, with health conditions, and with caring responsibilities. But flexible working can take many forms, and it takes flexible thinking, cultural intelligence, and line manager sensitivity to design workplaces that accommodate people’s needs, promote a culture of respect, and create the conditions for wellbeing. Focusing on culture and wellbeing outcomes takes DEI initiatives out of the realm of debates over representation and into shared consensus that benefits all.
5. Reset. Refashion. Recommit
Despite good intentions, DEI goals and strategies can become synonymous with correcting past institutional failures, pointing out privileges of majority groups, and leaving people feeling backfooted, apologetic or left out of the conversation entirely. This promotes alienation and resentment among non-minorities. Rather than fall prey to an increasingly polarised, policing, and strident strand of advocacy (for or against DEI), businesses are better served by promoting allyship and helping majority groups meaningfully engage and feel part of the community. Let us not throw the baby out with the bathwater!
Different ocean currents – some deep, some shallow – will continue to make up the churning oceans of diversity, equity, and inclusion. The acceleration of DEI initiatives and policies that followed in the wake of George Floyd’s death, reflected a collective ethical commitment to social justice. Such purpose driven actions are not easily changed, ignored or sidelined. In every challenge lie the seeds for change and new growth. The call to action for organisations is to think strategically and long-term about investing in DEI efforts. The reward is not in merely collecting data, but in turning it into high quality evidence that generates value for all stakeholders.
To learn more on how IES can support your organisation to address workplace inequalities and develop an evidence base for employee productivity and wellbeing, feel free to contact me at email@example.com.
This blog is the second of a two-part series. See part one: DEI trends 2023: reviewing the year gone by.
Other blogs by the same author: Why does the gender pay gap persist? A Nobel Prize winning answer
Any views expressed are those of the author and not necessarily those of the Institute as a whole.