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Inclusion and Diversity is a Positive Change for Irish SMEs

CIPD Chartered Institute of Personnel and Development

Positive change on inclusion can only come about through concerted, meaningful and intentional action. CIPD know that while the business case for diversity and inclusion is useful, financial outcomes are not the ultimate goal for inclusion at work. Creating shared value and distributing it to various stakeholders in its different forms is more important than driving business performance for financial stakeholders alone. If organisations are to achieve fair and sustainable forms of work that benefit all stakeholders (workers included), we need to locate inclusion at the centre of strategy and practice. It’s therefore crucial that people professionals help leaders in their organisations to move beyond bottom-line thinking and instead consider a very real and achievable alternative that works for all stakeholders, workers included: the triple bottom line in which workplaces are fair, transparent and inclusive.

Making this future a reality requires real commitment to change and tangible investment in improving management practices and capability. It also requires a long, hard look at the practices people professionals lean heavily on to understand if they really are inclusive, and an assessment of what must be improved if we’re to create more inclusive workplaces. Being evidence based is a key way for people professionals to ensure that the work they do is more likely to create positive outcomes, and does not unintentionally harm or exclude oppressed groups from good-quality work. Ultimately evidence must be the basis of decisions we make in the profession, and this should be apparent nowhere more so than in the inclusion space.

We assess the evidence on important questions relating to workplace inclusion, to better equip people professionals to truly deliver change and support their organisations to transform for the better. We research supports practitioners to build their knowledge and expertise and enables them to deliver lasting change for their organisations and the many stakeholders they serve every day.

Edward Houghton, Head of Research and Thought Leadership, CIPD

Making The Case for Inclusion

A focus on workplace diversity and inclusion (D&I) has undoubtedly led to progress in tackling workplace inequality in recent decades.

Gender is only one aspect. For example, the gap between female and male employment rates in the UK is the lowest since it was first recorded in 1971,1 meaning the UK workforce is more gender-diverse than ever. On the other hand, FTSE 100 CEOs in 2018 were more likely to be called Dave or Steve, than be female,2 meaning male and female experiences of workplace progression aren’t equal. And, gender is just one aspect of diversity. One piece of research highlights that if the current rate of progress remains the same, FTSE 100 companies won’t meet targets for BAME board representation until 2066.

Minority groups still have barriers to equality. Clearly, more needs to be done to make workplaces inclusive as well as diverse. Increasing representation for minority groups is not a panacea to these issues. Businesses must tackle barriers to equality, such as poor progression prospects, bias (both conscious and unconscious), over and above complying with legislation, to make real change. However, in previous CIPD research, Diversity and Inclusion at Work: Facing up to the business case, we identified a lack of robust evidence on how to meaningfully address barriers to equality.

Inclusion is considered to be the missing piece of the puzzle. An inclusive workplace culture allows all people to thrive at work, regardless of their background, identity or circumstance. However, how an inclusive organisation is developed, and what inclusion really means in practice, is less clear.

SMEs need to better define and understand inclusion, understand how inclusion relates to workplace outcomes and, importantly, how people professionals, line managers and business leaders can contribute to the development of more inclusive workplaces.

Box 1: Diversity, equality, equity or inclusion?
Diversity refers to demographic differences of a group – often at team or organisational level. Often, diversity references protected characteristics in UK law: age, disability, gender reassignment, marriage and civil partnership, pregnancy and maternity, race, religion or belief, sex and sexual orientation. CIPD members can find information on the legislation in relation to these characteristics in our topic pages and factsheets.5 Equality means equal rights and opportunities are afforded to all. The 2010 Equality Act in the UK protects those with protected characteristics from direct and indirect discrimination in the workplace.6 Equity recognises that treating everyone equally has shortcomings, when the playing field is not level. An equity approach emphasises that everyone should not be treated the same, but according to their own needs. Inclusion is often defined as the extent to which everyone at work, regardless of their background, identity or circumstance, feels valued, accepted and supported to succeed at work. This report explores this definition in more detail, to understand what inclusion means in practice, and how it might be assessed.

A Numbers Game?

Economic research shows benefits. A focus on increasing diversity at work is undoubtedly positive for individuals, and wider society. The economic case for more diverse workplaces is clear; research from the US shows that participation of women in state-level labour markets is linked to wage increases for all, and in the UK, research identifies that full representation of BAME individuals in the labour market would reap benefits to the tune of £24 billion.

Increases business performance is conceptually limited. This emphasis on diversity has perhaps been in part due to the focus (in both research and practice) on building the business case for diversity. Along with progressive policy-making and changing societal norms, this case has highlighted the importance of taking action on diversity. However, the focus on the traditional business case – that diversity increases business performance – is conceptually limited.

Individuals and their potential. First, it’s important to note that at individual level, being able to access and succeed in work, regardless of background and circumstance, is a basic tenet of equality, which employers have a responsibility to champion regardless of potential return on investment for diversity programmes. (For a discussion of the terms used in this report, see Box 1.)

Research also shows that the link between diversity and performance is highly dependent on context. As one author puts it, ‘simply representing a greater variety of differences in an organization or group is not a magical path towards greater performance’. In other words, having a diverse workforce is a good start, but there are other important factors that influence workplace outcomes, such as employee experience and organisational context.

Diversity needs people and systemic change. Finally, the business case isn’t always effective in galvanising employers to make systemic changes that tackle barriers to inclusion and equality. It focuses on moving the dial on diversity numbers, but not on systemic change. Increasing diversity through targeted recruitment, for example, is unlikely to tackle the underlying causes of a lack of diversity.

From Diversity to Inclusion

Everyone experiences a company differently. Positively, inclusion is increasingly seen as a key driver of progress towards workplaces where everyone can thrive, recognising that workplaces aren’t inclusive for everyone. Indeed, employees in the same company can experience the workplace differently depending on their line manager and team, but also background and circumstances.

It’s clear that, as well as employing inclusive practices, different perspectives, beliefs and norms must be valued by an organisation and its leaders and employees for a diverse workforce to thrive. How best to make this change is less clear.

For example, recent figures from a survey of over 100,000 LGBT people in the UK found that ‘23% had experienced a negative or mixed reaction from others in the workplace due to being LGBT or being thought to be LGBT’, and a CIPD survey of BAME employees found that BAME employees were more likely to say identity of background can impact the opportunities given at work. More broadly, findings from the CIPD UK Working Lives survey highlight that 22% of employees feel that other team members would judge others for being different.

These findings highlight that focusing on diversity alone could even be counterproductive as it doesn’t address the systemic challenges to workplace equality and inclusion, such as workplace culture. It instead puts underrepresented, or less ‘powerful’, groups in harm’s way, potentially doing more harm than good.

Inclusion, then, might be a better starting point for organisations wanting to increase diversity. For example, a survey of business leaders and HR professionals found that less inclusive organisations are more likely to fail to be making changes off the back of gender pay gap reporting and cite senior leadership support as a barrier to the success of ethnicity pay gap reporting.

It’s clear that, as well as employing inclusive practices, different perspectives, beliefs and norms must be valued by an organisation and its leaders and employees for a diverse workforce to thrive. How best to make this change is less clear.

Understanding and Taking Action on Inclusion

Inclusion is a promising idea; allowing everyone to be included and supported at work, regardless of their background, makes sense for businesses and employees. But what do we mean when we say an organisation is inclusive? Is it about people management practices, employee experience and organisational values, or a combination of these factors?

Without clarity on what inclusion means, taking targeted action in organisations is challenging – and, there is a risk that inclusion initiatives are rebranded diversity initiatives that don’t fully address barriers to inclusion.19 Addressing these barriers requires businesses to reflect on their culture and practices, and employee experience more broadly. This lack of clarity also makes it challenging to measure progress and evaluate the success of inclusion strategies.

DARE explores inclusion and inclusive practices and provides guidance for people professionals, business leaders and line managers to measure and improve inclusion in their workplace. It does this by providing a series of resources, training and supports specific to SMEs and entrepreneurs.

Source: Building Inclusive Workplaces Report CIPD

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