4 Ways Inclusive Companies Drive Success

According to a recent LHH LinkedIn survey, diversity, equity, and inclusion (DEI) are top priorities for learning and development professionals.

Many workplaces still have a long way to go in realizing the full potential of their employees, regardless of race, gender, sexual orientation, neurodiversity, or physical ability. It’s crucial, then, for businesses to move away from outdated hiring mindsets and cultivate a culture that actively seeks out and addresses biases. Jeramy Kaiman, Head of LHH Knightsbridge explains that “people are afraid to speak on the DEI topic because they’re afraid it’s too sensitive, but you just need to speak from authenticity, be transparent and kind." And doing so, is well worth the effort. Read on to discover just how DEI organizations drive company success.

1. Talent pipelines

Unconscious bias affects most individuals to some degree. To counteract these biases, it’s important that we implement strategies that include employee training around stigmas and unbiased hiring practices, ensuring that underrepresented candidates receive fair consideration.

Efforts to support and promote inclusivity for all races, genders, and identities within the LGBTQ+ community have yielded positive results. According to research, 79% of employers have taken action to ensure inclusivity, leading to a 10% increase in stock returns. Reinforcing the idea that today’s competitive economy has no room to dismiss valuable talent based on arbitrary biases.

Quotas for neurodiverse talent are also on the rise. It’s estimated that around 15-20% of workers in the U.S. are neurodiverse, managing conditions such as Autism, ADHD, OCD, or dyslexia. However, the unemployment rate for this group remains alarmingly high, reaching 30-40%. Interestingly, the unique ability of neurodivergent individuals to hyperfocus on their strengths is now recognized as a valuable asset—research from Deloitte suggests that teams with neurodivergent members can be 30% more productive. As a result, renowned companies such as Microsoft, Hewlett Packard, Dell, Deloitte, and IBM are actively seeking out this untapped talent pool.

This emphasizes the remarkable ways in which underrepresented and often overlooked groups contribute to the growth and potential of companies when they are given the opportunity.

2. Company culture

According to LHH's Global Workforce of the Future report, a culture of belonging is as vital as salary and flexibility when it comes to talent retention and productivity. However, only 61% of workers currently report satisfaction with their company culture. We discovered that a significant portion of white-collar workers, around one-third, are considering leaving their jobs within the next 12 months, with an additional 24% planning to do so in the long term. Of those who wish to leave, 22% cited company culture as the primary reason.

So, what can employers do to retain these employees? Our research indicates that flexibility, open-mindedness, and an environment that nurtures innovation are critical. These are also key characteristics of a diverse workforce, as identified by the Harvard Business Review.

It’s important to emphasize that a conducive company culture goes beyond creating a pleasant working environment. It directly impacts revenue and performance. McKinsey's research has shown that companies with greater diversity are more likely to outperform their counterparts financially. Likewise, the consequences of falling behind on diversity are escalating with each passing year.

3. Internal mobility for underrepresented groups

Let’s face it—the underrepresentation of women and minorities in leadership positions results in a lack of diversity at c-suite and higher-up levels, limited representation, and fewer opportunities for internal mobility.

Unsurprisingly, research done by McKinsey revealed that companies with more than 30% women executives consistently outperform those with less than 30% women executives. In fact, the companies with the least gender diversity experience a performance lag of up to 48%.

In the UK, there has been progress with 96% of FTSE 100 companies reporting that they have at least one minority ethnic director on their board, a notable improvement from the previous year. However, the existence of a few companies with all-white boardrooms has prompted a government-backed committee to establish new inclusion targets. What many of these companies may not realize is that the lack of inclusion is actually hindering their success in the business world.

4. Talent retention

Retaining talent is often just as challenging as finding it in the first place. The challenge around talent retention has revealed some of the weaknesses in major organizations, and one major issue is, of course, the lack of inclusion. In fact, our research indicates that 25% of workers are actively seeking to change jobs due to dissatisfaction in this area.

Gen Z employees, in particular, are driven by their principles and values. According to LinkedIn, 87% of Gen Z workers would be willing to switch to an employer that aligns better with their diversity, equity, and inclusion values. With Gen Z projected to make up 27% of the workforce in OECD countries by 2025, it is crucial not to alienate them, as it could severely impact your companies future prospects.

Creating an inclusive workplace cultivates diverse ideas, fuels innovation, improves overall performance, and ultimately leads to greater financial returns. So, it’s worth considering: how far is your organization from unlocking the power of inclusivity?

At LHH, our mission is to achieve a continuously evolving work environment in which all individuals feel valued, supported, and respected. Contact an LHH expert today to learn more about how we can help you achieve your own DEI ambitions.