Setting ED&I goals to drive success
By Jackie Grisdale
Setting achievable goals – the key to driving momentum and long-term successful ED&I strategies
The benefits of an established ED&I strategy have been long documented via McKinsey research, which has found that those operating best practice when it comes to nurturing diverse talent deliver higher financial returns than their peers by a significant margin:
- Companies in the top quartile for ethnic diversity were 39% more likely to outperform those in the bottom quartile.
- And businesses employing more than 30% women at exec level were significantly more likely to outperform those with less than 30%.
- Companies in the top quartile for both gender and ethnic diversity in executive teams are on average 9% more likely to outperform their peers.
- Meanwhile, those in the bottom quartile for both are 66% less likely to outperform financially on average, up from 27% in 2020, indicating that lack of diversity may be getting more expensive.
Their research (and their 2023 report ‘Diversity Matters Even More’ is their fourth iteration since 2015) has continually found that diverse workforces lead to more innovative ideas and deliver better products and services more quickly.
Slow progress early in the pipeline will hinder the achievement of gender targets at more senior levels.
However, McKinsey’s 2024 ‘Women in the Workplace’ report found that while women’s representation has increased at every level of corporate management - most notably, women today make up 29% of C-suite positions, compared with just 17% in 2015 - progress has been much slower earlier in the pipeline, at the entry and manager levels.
Women remain less likely than men to be hired into entry-level roles, which leaves them underrepresented from the start. And then they are less likely than men to attain their very first promotion to a manager role. In 2018, for every 100 men who received their first promotion to manager, 79 women were promoted; in 2024, just 81 women were. Because of this “broken rung” in the corporate ladder, men significantly outnumber women at the manager level, making it incredibly difficult for companies to support sustained progress at more senior levels. This phenomenon is even worse for women of colour, who represent only 7% of current C-suite positions—just a four-percentage-point increase since 2017.
They concluded that at the current pace of progress, it would take 22 years for White women to reach parity, and more than twice as long for women of colour.
Setting realistic targets is a key motivator in delivering successful strategies.
One thing that is key when it comes to maintaining a focus on ED&I and driving progress is ensuring that you have realistic and achievable objectives that you’re able to measure your progress towards. Identifying where potential issues lie, creating interventions, establishing benchmarks and then measuring change means any ‘wins’ are visible – and even small wins can generate enthusiasm and build momentum.
When we work with our clients to establish targets, we take an approach that aligns with that proposed by PwC in their ‘Diversity Data Guide 2024’ - looking at historical recruitment, promotion and attrition rates at a whole workforce level, and where appropriate, by geography and at team, role and/or band level. Understanding internal data and trends helps to predict forward and also inform the interventions required to achieve those targets, by modelling different scenarios – adjusting the levers of recruitment, promotion and attrition.
This involves merging multiple complex data-sets into fully customised data models and dashboards, aggregating various data points to truly understand the client’s talent pipeline, its composition and their progress towards fulfilling their demand – be that by geography, team and when it comes to early careers, by programme.
These technology solutions provide us and our clients with visibility of not only how many people are in their pipeline, but also the quality and demographic composition. They allow us to visualise:
- Volume of candidates through the pipeline by stage through to hire
- Diversity at all stages
- Test scores and pass rates at all stages of the process
- Withdrawals/reneges
- Where relevant, language fluency and the impact of this on test scores
- Media source and for early careers, we can look at university and subject feeders
- And we can build in candidate and employee survey results
When it comes to diversity, all of this data can be segmented by gender, ethnicity and social mobility indicators for example. Having this understanding, from attraction through to hire and beyond, provides the opportunity to turn data into insight and insight into action when it comes to creating interventions. For example, understanding where candidates from different underrepresented groups drop out of the recruitment process informs changes that might be made to support their successful progression. And once in the business, understanding by geography and team where the success stories are when it comes to retention for example, and where the challenges lie, means that best practice can be shared across the business.
We’re able to support our clients to optimise their pipelines, while creating a smoother, fairer and better experience for their candidates all around the world. Through innovation and robust data analysis, we help them to move the dial when it comes to their ED&I initiatives as well as delivering stronger candidate engagement.
And as well as looking at the client’s own internal data, we also undertake a macro-environment review to understand aspects such as:
- Overarching market trends when it comes to the current representation of their target group, e.g. women, Black Heritage, in the workforce, across relevant sectors and roles, geographies, and at different levels of seniority – whichever is appropriate to the project.
- We may look at participation in education and across specific subjects subject to the nature of the challenge and if we specifically want to influence early careers.
- Any relevant government initiatives supporting participation in education or employment among the target group.
And leadership diversity has wider holistic impact on communities, workforces and the environment.
We know that having defined targets can really help to shift the dial when it comes to diversity within organisations.
According to the Harvard Business Review, “… for data reporting and goals to be effective, they must be detailed to create transparency; shared with insiders and the public to induce accountability; and accompanied by action plans to promote change. When companies have followed these principles, they’ve seen notable increases in women and people from ethnic minorities in management. And the more companies there are that do it right, the more there will be that join in.” 1
And a topic for another time, but McKinsey’s most recent report also found that more diversity in boards and executive teams is correlated to higher social and environmental impact scores – areas which also sit high on the agenda as organisations strive to create and evidence their positive social impact.
1 Harvard Business Review, ‘How Companies Should Set - and Report - DEI Goals’ (September 2022)