Diversity, Equity, and Inclusion
DEI initiatives are not just for corporate America. Small, minority-owned businesses also stand to benefit from such programs.
Being a minority community themselves, Indian- Americans are well aware of the need for inclusion and equitability in the workforce. As employers, it should therefore come naturally to these companies to favor Diversity, Equity, and Inclusion (DEI) initiatives in their own firms. What makes it even easier to consider and embrace such programs is the proven benefits they bring to small businesses.
What is DEI?
Diversity, Equity, and Inclusion programs encourage and educate management on the hiring and retention of employees that represent diversity in race, ethnicity, gender, and age. These programs include recognition of individual biases that may exist, education on overcoming the biases, instituting programs that focus on retaining diverse employees, and tracking metrics to ensure that the programs are creating the desired results.
Benefits of DEI
Results have proven that diverse teams result in more profitable companies. Evidence has shown that a team made up of cognitively diverse individuals makes more effective decisions than teams that only contain people that are cognitively homogenous.
Companies that are already owned and operated by minorities should consider making an effort to include members of other communities in their labor force. This could benefit the business by attracting the best talent that may be available for their company and letting them connect better with their customers.
In the Indian-American community, service companies (like law firms and accounting firms), technology companies, and staffing companies have been at the forefront of obtaining minority certification. The certification is important and a smart way to generate new business. By introducing a DEI initiative, a company can show that it lives by the principles of fairness and equality and is willing to give to the initiative and not just take from it.
Large companies prefer to do business with smaller companies that emphasize diversity
Additionally, with the largest companies striving for diversity in their leadership, it is a good idea for small and medium-sized businesses to keep pace with this initiative. Companies with strong diversity and inclusion initiatives are more likely to do business with others that share their diversity values as partners and customers. Many of the Fortune 1000 companies have DEI programs that give an advantage to entities that are minority, women, or veteran owned. Other large companies will request that all vendors or potential vendors submit a census that identifies the racial and gender makeup of their workers.
Some of the most successful enterprises in our community have made it by getting business from one or two of the largest U.S. companies. Staffing companies, in particular, have grown ten times by getting these profitable contracts. To maintain those customer relationships, they have learned that their workforce must look much more like the country as a whole.
Diversity helps attract young talent
There is clear evidence that younger millennials and Gen-Zers demand and expect diverse environments. They are more diverse than any other generation of Americans in history and, consequently, they expect diversity in their workplaces. Surveys have shown that an inclusive workplace is one of the primary factors that younger workers are looking for while searching for a job. Given the weight that the young workforce places on DEI, increasing diversity can ensure that your business remains competitive and can recruit the most talented individuals.
Diversity enhances engagement
Perhaps the most important benefit of increasing diversity in the workplace is the effect that it has on employees and customers. Aside from the benefits in recruiting, outlined above, employees in diverse workforces are more engaged with their work. In a work environment where employees, especially those who are younger, are less interested in going above and beyond their assigned duties (sometimes known as quiet quitting), having an engaged workforce is essential for your business to succeed. Disengaged employees can have a domino effect as their lack of engagement can rub off on their coworkers, lowering the productivity of the workforce as a whole. The connection between diversity and engagement is significant, employees that feel like they are being included tend to feel more engaged with their job.
Learnings
DEI initiatives have low costs of implementation and offer myriad benefits to a business. Additionally, diversity in the workforce offers the same benefits of diversity in management—when people with different backgrounds and ideas come together, they can pool their knowledge and experiences for the best results.
DEI initiatives make businesses more attractive partners for the government and the largest Fortune 500 companies who are increasingly evaluating the diversity of potential business partners. They can also help improve the reputation of the business internally as employees put a high value on diversity in their workplace. Taking steps to increase diversity can demonstrate strong leadership by showing employees that owners care about them and want to create a workplace where they can be happy and successful.
Business Insights is hosted by the Law Firm of KPPB Law (www. kppblaw.com) based in Atlanta, Georgia with additional offices in New York, Northern Virginia, and Chicago. Sonjui L. Kumar is a corporate transactional lawyer representing companies in all aspects of business law, including corporate governance, mergers and acquisitions, and cross-border transactions. She is a founding partner of KPPB Law. She can be reached via email at skumar@kppblaw.com.
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