DEI Isn't the Enemy: It Helps Organizations Navigate Conflict and Change

This story is part of Let's Talk About It, a guest-contributed column exploring how to navigate hard conversations and complex challenges in the workplace. If you're interested in contributing your perspective on DEI, corporate culture and workplace issues to this column, please get in touch with us here. 

Almost as soon as the news broke that a cargo ship lost power and hit a bridge in Baltimore, conspiracy theorists took to social media to blame the accident on diversity, equity and inclusion (DEI) initiatives. While some making the claim are merely internet trolls, the sentiment was also shared by a former member of Congress and a gubernatorial candidate. Before Baltimore’s Key Bridge collapsed, a critical safety incident on a Boeing plane was also blamed on DEI, a charge championed by billionaire Elon Musk, who has called DEI “another word for racism.” Perhaps this attitude explains why his electric vehicle company was recently ordered to pay a former employee $3.2 million in a racial discrimination lawsuit.   

If the people with influence making these claims had a better understanding of the value of DEI, they would see it as an insurance policy against workplace discrimination claims and the strain they put on productivity and profitability. It’s a no-brainer to think that employees will be more engaged in a workplace where they feel valued and treated fairly. 

The value of DEI to leaders was clearly demonstrated in the wake of the October 7, 2023, attack by Hamas on Israel. When Israel responded with force, the world reacted. U.S. college campuses, in particular, became a symbol for pro-Palestinian sentiment, and several university leaders were summoned to testify before Congress about campus protests. Under this scrutiny, DEI opponents cynically linked diversity programs to antisemitism and attacks on DEI proliferated, providing new fuel for those who had already mounted a concerted effort to sink these policies long before the Israel-Hamas conflict.
 
Many companies felt pressure from internal and external stakeholders to comment on the Hamas attack and its aftermath. Knowing what to say about complex and emotionally charged global events is uncomfortable territory, especially as sympathies toward both sides in the conflict shift — particularly among younger generations, hence the congressional focus on college campuses. 

Navigating this uncharted territory creates a crucial test for leadership that requires a thoughtful and strategic approach.
 
Change is the only reliable constant, and smart leaders will invest in planning for change sooner rather than later. Effective leaders take necessary steps to control their destiny, and investing in DEI is one way to future-proof an organization.

Take, for instance, a small financial services firm we consult that initially struggled with how to respond to the conflict. Leaders recognized that office opinions about the situation were divided and that any statement they made was likely to disappoint some subset of their employees. But they also recognized they couldn’t ignore the situation. 

Instead of issuing a statement, they facilitated a listening circle with carefully considered ground rules, providing employees with a safe place to express their feelings and perspectives. The session reinforced the company’s commitment to creating an inclusive work environment and allowed employees to feel heard, valued and engaged.
 
This private equity firm passed a critical leadership test because the executive team considered the needs and perspectives of the company's stakeholders. They took the time to understand why their employees cared about the conflict and how they are personally impacted by events halfway around the world. Company leaders also took the time to acknowledge their own points of view and why they hold those opinions. Checking your own bias can be difficult, but it’s important to be honest about why you feel one way versus another. Listening exercises like these demonstrate respect for differences of opinion and different perspectives.
 
In contrast, another mid-sized company in the healthcare space that our firm is familiar with took a different path and failed the leadership test in its response to the Hamas attack. The company’s CEO sent an all-staff email reflecting his personal beliefs without consulting anyone in the organization. Many people on staff were offended by the message and felt like they didn’t belong at the company. Months later, the company is still trying to manage the internal crisis, spending precious capacity on a problem that didn’t need to happen.
 
Making employees feel heard and valued is an important factor in improving employee engagement. Gallup research shows that only 32 percent of employees are fully engaged and thriving at work, a number that has continued an alarmingly steep decline since the pandemic. Interestingly, engagement is higher among employees who are either fully remote or in a hybrid work location, possibly reflecting the fact that people are less likely to experience microaggressions outside of the workplace. But since 61 percent of the U.S. workforce cannot work from home, investing in DEI remains critically important for most workplaces.
 
Although some news travels fast and is impossible to avoid, it is important for leaders to remember that not all events worth acknowledging make headlines. Whether it is the psychological trauma Black Americans face inside and outside the workplace, the targeted attacks against Asian Americans during the COVID-19 pandemic, or even the economic stress low-income Americans navigate daily, every employee carries their personal and community trauma to work each day. Leaders can make the workplace more welcoming, for example, to Black employees by recognizing the effects of injustices and violence that occur closer to home. What business leaders choose to react to, or not react to, sends a message about company values, whether it is intentional or not.
 
Today’s company leaders are so much more than bosses and managers, and leadership is more nuanced than giving orders and setting goals. Today’s leaders are responsible for setting the tone of an organization by reinforcing its culture and demonstrating its values. Leaders need to create workplaces where employees feel safe — both physically and psychologically — and want to do their best work and be fully engaged. While a leader may be responsible for a final decision on how to address a particular situation, they will be well-served to listen to diverse perspectives before making that final decision.
 
While billionaires may blame their large legal bills on DEI, the risk and liability were created by the absence of a DEI strategy. A workplace that tolerates racial abuse, pervasive stereotyping, and hostility — including epithets and slurs — does not respect the civil rights of its workers and leaves itself vulnerable to civil and criminal legal action.
 
Effective leadership means standing up for what is right by fostering a culture where everyone feels empowered and welcome to contribute their unique perspective and talents, ultimately leading to a more successful, strong, and resilient organization for the long term.