DEI & Affirmative Action:

The Differences of Impact

By: Marilyn Nagel

The recent US Supreme Court (SCOTUS) ruling on Affirmative Action and some political rhetoric mischaracterizing DEI work in corporations raises questions for many companies.

Let’s sort out the facts, to start.

Good corporate DEI is not an Affirmative Action program. In this ruling the SCOTUS determined the use of race as a factor in undergraduate admissions was unconstitutional. The move has presented a new legal test for colleges and universities trying to achieve diverse student bodies. Unfortunately, it also reignited the political debate around Affirmative Action and DEI in general in the corporate world. 

To clarify, Affirmative Action (AA) is a US Government policy intended to increase racial diversity and equity in institutions such as universities and government agencies. It was created to combat discrimination against minority groups, particularly Blacks and Latino/a individuals. There are ways schools can address the ramifications of this ruling. The key point is that this is different from corporate DEI.

Unlike AA, Diversity, Equity, and Inclusion (DEI) is the conscious and deliberate design, development, and management of an inclusive culture for the benefit of all employees and most importantly the benefit of the company. It is critical to the economic and social well-being of companies, workplaces, and communities. DEI is not just a proxy for fairness. It is about building better companies by maximizing the potential in everyone and minimizing employee attrition through more inclusive cultures.

Multiple studies consistently confirm diverse talent helps companies understand customers' needs and deliver on those needs. Moreover, diverse workplaces create a culture of innovation, and help drive the company towards goals through collaborative methods. The best teams include people with diverse skills and backgrounds and research consistently shows that diverse teams make better decisions. Successful companies understand the business value of developing all employees by growing talent at all organizational levels to fulfill its mission while aligning with its values.

Confusion arises when companies focus solely on and share diversity goals/targets through talent acquisition (TA). This is short sighted in many ways. First, numeric goals for TA can drive bad behavior on the part of a hiring manager who may want to meet a goal and then hire someone less qualified, who ends up being unsuccessful. This is bad for the new hire who is labeled a “diverse hire” and bad for the overall culture by suggesting underrepresented candidates are not qualified or cannot succeed at the company. Asking for a diverse candidate pool with at least 2 qualified candidates who represent a minority group is a best practice many companies use successfully. Suggesting a hiring target is neither advisable nor beneficial.

Increasing diversity on a team helps to increase overall quality by adding new perspectives from people who bring new points of view and avoid groupthink.  Developing your existing talent and casting a wider net for qualified candidates to bring both skills and new thinking are great DEI strategies that add value. Organizations can aspire to be diverse in multiple ways, including being best in class in diversity of thought, particularly on leadership teams.

Many companies are also rethinking educational requirements tied to socioeconomic factors that may not impact on career success. These actions might take longer, and leaders need patience while they build new networks to create opportunities for those outside their usual circle. Note, these are not affirmative action, not quotas or targets to be met. DEI is not affirmative action and should not take on its characteristics.

A company’s DEI strategy must focus on Inclusion and Equity, not simply a Diversity numbers initiative. It must ensure everyone has opportunities to work towards their full potential, that leaders create an inclusive culture and are representative of the whole organization as well as reflective of clients and customers.

DEI is vital to company performance. In our current climate of reductions in force, agility, and globalization, this requires holistic strategies that tie DEI to advancing business goals which integrate into the rhythms of the business.

Wise leaders know they must have the right strategy to recruit, retain, develop, and leverage diverse populations, developing competencies for inclusion and appreciation for the value people bring. We work with clients on DEI assessments, practices and solutions and welcome your call should you seek advice or support.