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Diversity & Inclusion

Why and how organizations should create a DEI policy

Posted by Glassdoor Team

Career Advice Experts

Last Updated February 24, 2022

Companies are increasingly recognizing the need for diversity, but the path to achieving it is less obvious. Over the last 50 years, trends toward affirmative action have given way to diversity, equity, and inclusion (DEI) policies. To understand where we are, how we got here, and where we’re going, you've got to examine the roots of affirmative action plans, the shift to DEI, and how strong DEI initiatives should be implemented.

What is affirmative action?

The term “affirmative action,” as we now understand it, first emerged in federal employment policy in 1961. After nearly 80 years of legalized segregation through state-level Jim Crow laws, President John F. Kennedy signed Executive Order 10925, which required government contractors to "...take affirmative action to ensure that applicants are employed and that employees are treated during employment without regard to their race, creed, color, or national origin," according to Smithsonian magazine. Use of the term spiked after President Lyndon B. Johnson issued a similar executive order, EO 11246, in 1965.

Early applications of affirmative action required employers to take active steps to avoid discrimination against the protected categories of race, creed, color, or national origin. But the term, as most Americans today understand it, is to place more emphasis during an admissions or hiring process on people who belong to categories that have historically been the targets of discrimination.

Early applications of affirmative action required employers to take active steps to avoid discrimination against the protected categories of race, creed, color, or national origin.

That’s because a few notable Supreme Court cases — University of California v. Bakke, Grutter v. Bollinger, and Fisher v. University of Texas — have upheld university policies allowing admissions officers to consider race in admissions decisions with the goal of creating diverse student populations.

As a practical matter, affirmative action policies in education may justify a university admitting a student with, for example, slightly lower test scores or grades by weighing the applicant’s race or ethnicity more favorably. In the workplace, affirmative action takes on a similar form, permitting — or even encouraging — managers to consider race, ethnicity, gender, or sexual orientation in hiring decisions to create more diverse teams.

The goal of affirmative action is typically limited to recruiting, admissions, or hiring decisions. To create healthy, productive environments for people of varying backgrounds, there needs to be a focus on inclusion and belonging.

What is DEI?

In the workplace, diversity, equity, and inclusion (DEI) is a holistic approach to hiring, empowering, and retaining a diverse workforce. The goal of DEI is to create an environment that ​​encourages “representation and participation of diverse groups of people, including people of different genders, races and ethnicities, abilities and disabilities, religions, cultures, ages, and sexual orientations and people with diverse backgrounds, experiences, and skills and expertise.” 

While an affirmative action policy can quickly yield a more diverse team, a DEI policy is a long-term systemic approach that touches on various elements of an organization, from hiring to training to marketing. 

For a DEI policy to be successful, it can’t be just a hiring strategy or an occasional workshop; it has to flow through the entire organization. Creating an environment where employees understand what it means to be inclusive can help give your team members a sense of belonging

According to a 2020 Glassdoor survey, diversity and inclusion are important factors for the majority of today's job seekers, but more so for underrepresented groups.

For a DEI policy to be successful, it can’t be just a hiring strategy or an occasional workshop; it has to flow through the entire organization.

Two common stumbling blocks in DEI

According to Timi Adegoke, a diversity and inclusion specialist who’s worked with some of the biggest companies in the tech industry, the most common misconceptions around DEI are two sides of the same coin: it is so easy anyone could figure it out,or it is too difficult to ever succeed — in other words, DEI minimizers and defeatists.

DEI minimizers 

DEI minimizers within an organization may assume that creating and executing inclusion and belonging policies should be quick and simple. “They don't understand why you don't just do X-policy, or why you don't just change Y-thing,” Adegoke explained. “What they don't know is that you've already thought about that exact idea, and you've come up with 10 reasons why it won't work at your company; or maybe you think it's a great idea, you suggested it to someone, and the powers-that-be told you that it was absolutely not possible.”

DEI defeatists

On the flip side are the DEI defeatists who assume that all organizations have a DEI problem and no one’s getting it right or that tangible results are years away. But Adegoke said there are companies and industries making significant headway in diversity and inclusion.

“Of course, nothing can happen overnight, but I think it's a lot easier to make small, but tangible, and directionally correct changes than people think it is,” Adegoke said. “It's a journey, but all journeys eventually have to reach their destination. Just because it might take some extra time or extra work, it doesn't mean that it's ridiculous to actually expect results.”

“Of course, nothing can happen overnight, but I think it's a lot easier to make small, but tangible, and directionally correct changes than people think it is.”

Timi Adegoke

How can a company create a successful DEI policy?

A successful DEI policy requires education and accountability. It should be a funded, ongoing effort that is built into the day-to-day workflow of an organization. But there’s not a one-size-fits-all solution. 

Data collection

The first step in creating a DEI policy is a deep dive into the company’s culture.

“Each organization's a living breathing thing, and has different needs constraints, contexts, and abilities,” according to Lily Jampol, PhD., Head of People Science and Consulting at ReadySet, a DEI consulting and strategy firm. “It’s really important to do the work upfront; to understand what that context is by gathering data that includes quantitative and qualitative data, and focusing on the voices of the most impacted communities within those organizations.”

Crafting a DEI policy begins with information gathering, though it can be a time-consuming process. A large-scale assessment might take months, but the findings can help a company’s leadership team create a strategy and implementation plan.

Policy creation and risk assessment 

Jampol said it’s important for company leaders to seek buy-in and participation across the organization when creating a DEI policy. “The most effective programs we've seen have empowered staff to actually be able to contribute to these programs; it doesn't just feel like it's happening to them. They're actually a part of that change,” she said.

Before implementing a policy, leaders should also do a risk assessment, remembering that any change comes with risk. This is an opportunity to consider the practical implications of a proposed DEI policy and make changes as needed. 

Here, Jampol explained it’s not just a matter of risks to the organization, but to impacted communities. Executives often express concerns that employees will quit if they don’t like a policy, or that a company could become embroiled in a lawsuit or a PR nightmare. But there are also risks like losing talented team members for failing to act or increasing microaggressions with an ill-conceived or poorly implemented program. 

Communication

Once a plan is established, those at the top of the organization need to be able to communicate the importance of any changes that are taking place effectively and consistently. 

“Communication is a huge part, and that starts at the top,” Jampol said. “Managers need to be trained to make sure they can explain all of the reasons why this is happening and also get other people on board because they are going to be the main nodes of culture building.”

Communication needs to remain a two-way street, with leaders soliciting and weighing feedback into ongoing changes.

Accountability 

A company can’t determine whether a plan is working unless it’s tracking metrics, but they don’t all have to be quantitative metrics. According to Jampol, companies must ask the question “What does success actually look like at our organization if we're doing this well?” 

It could include things like productive discomfort, (i.e. employees having productive conversations around uncomfortable topics), more people showing up to workshops, or progress toward the company’s talent attraction goals. 

Every organization will have its own metrics for success, but it’s important to have the flexibility to pivot and iterate on what works or doesn’t work. 

Examples of companies that do DEI well

Square, the San Francisco-based payment processor, is a great example of a company with a strong DEI policy. The company values transparency and posts information about its diversity and inclusion policies online. It also publishes an annual workforce data report, making its DEI goals and progress toward those goals public — a smart step toward accountability. Those efforts have translated into high employee satisfaction ratings. Square’s parent company, Block, ranked 36th on Glassdoor’s 2022 Best Places to Work list.

Another standout from the Best Places to Work list is Rivian (#20), the Illinois-based electric truck manufacturer, who also received high marks for diversity and inclusion. Rivian has incorporated DEI into its everyday workflow by establishing a dedicated Director of Belonging to ensure that the company remains “an inclusive and inspiring” space. 

Why systemic change matters 

In the wake of the 2020 wave of anti-Asian hate crimes and Black Lives Matter protests, organizations rushed to enlist diversity and inclusion experts for workshops. There was a sense that everyone should be doing something, so education must be the answer. And while education is an important piece of any DEI plan, these expert workshops shouldn’t constitute the entirety of a DEI plan. 

To foster diversity and inclusion, organizations need patience and a holistic approach to systemic change. Substantial change can take time, but if a DEI plan is well-executed, companies can start to see short-term returns that snowball into long-term progress.
Want to learn more about DEI programs? Explore Glassdoor’s DEI guide for employers.

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