Moving the needle

After summer protests, businesses wrestle with equity and inclusion

Published August 29, 2020 by Greg Weatherford

A few years ago, Nadine Marsh-Carter and the staff of the small adoption agency she runs decided that to better represent the children they worked with, they needed board leadership that better reflected their clients.

Founded 120 years ago, the Children’s Home Society of Virginia began with a focus on finding families to adopt “healthy white babies” born out of wedlock, Marsh-Carter says bluntly. But as the world changed, so did the Children’s Home Society. It began seeking homes for Black babies, older children and children with disabilities and diseases such as HIV. It has located homes for 15,000 children since its founding.

But for much of its history, the society’s leadership did not resemble its young clients — board members were almost exclusively white, recalls Marsh-Carter, the daughter of retired state Sen. Henry Marsh III, a pioneering civil-rights advocate and Richmond’s first Black mayor. “Our service delivery has evolved,” Marsh-Carter says, “but our board wasn’t as diverse.”

After a recruitment push, the agency’s board now includes 40% people of color, up from about 10%, she says.

Similar efforts have expanded throughout the agency and its staff of 17 people. Working with consultants, the organization created procedures — such as expanding job-recruitment processes; holding regular discussions on topics such as race and justice; and establishing an anonymous suggestions box — to be sure employees and board members feel welcome and share values of diversity, inclusion and equity.

The results, Marsh-Carter says: Better outcomes for the families the agency serves, a more cohesive workplace and a renewed sense of purpose as advocates for children who often face profound adversity.

“People here have different backgrounds and experiences and they have to work together,” Marsh-Carter says. Common goals, shared understanding of each other’s experiences and deeper insights into their clients is “a win-win-win.”

These days, Marsh-Carter’s nonprofit has a lot of company. Since the worldwide outrage and widespread protests that followed the May 25 killing of George Floyd by Minneapolis police, corporate attention to issues of diversity and inclusion has skyrocketed.

Diversity becomes a priority

“Our team has been really overwhelmed by an unprecedented wave of requests for support,” says Jonathan Zur, president and CEO of the Virginia Center for Inclusive Communities, a nonprofit that consults with companies and nonprofits — including the Children’s Home Society of Virginia — and facilitates discussions on issues of diversity and inclusion.

Initially, clients want to know how to respond to the outpouring of emotion around such a complex and difficult topic, Zur says. Common responses include listening sessions, employee counseling and statements of support.

Job postings for diversity officers surged by 50% in June, according to careers site Glassdoor. Meanwhile, online searches for the term “chief diversity officer” spiked to an all-time high in June, according to Google Trends — with Virginia and Washington, D.C., at the top of the rankings by region for searches of the term.

However, the focus on diversity may be a recent change of heart for many companies. During the early months of the pandemic, between March and early June, postings for job titles such as “chief diversity officer,”  “diversity and inclusion recruiter” and “D&I program manager” dropped nearly 60%, Glassdoor found. By comparison, postings for overall human resources jobs fell 49% in the same period; job openings in general sank 28%.

As Nicole Sanchez, CEO of Berkeley, California-based Vaya Consulting, which focuses on diversity, equity and inclusion issues, told The Washington Post this July: “How am I supposed to believe that the thing you said was dispensable just weeks ago is suddenly the most important thing you’re doing?”

“Public comments are not enough,” says Janice Branch Hall, director of diversity and inclusion at Virginia Tech’s Pamplin College of Business. “People need material action.”

A wealth of research supports the idea that it’s good business to build and nurture a diverse, equitable and inclusive organization.

In 2018, McKinsey & Co. analyzed the financial results of more than 1,000 businesses and found that companies in the top quartile for ethnic or cultural diversity were 33% more likely to have above-average profitability than companies in the fourth quartile.

Researchers say this makes sense. A business with decision-makers who understand and reflect diverse customers, clients, competitors and colleagues will have an advantage over those without.

Leading by example makes a big difference, McKinsey found: Companies with the most ethnically and culturally diverse boards were 43% more likely to record higher profit.

Culture by design

Demographic experts say welcoming a diverse and inclusive workforce is key to attracting top talent. Millennials — now the largest generational cohort — overwhelmingly prefer to work with people who are different from themselves and score leaders who value diversity and inclusion more highly than those who do not, according to a 2018 Deloitte study.

With all that to support the business case, why have so many corporations recently begun scrambling for support on issues of race and inclusion? Workforce experts again point to the data.

White males hold 85% of executive positions, according to the human resources consulting company company Mercer, yet comprise only about 31% of the nation’s population. Only four CEOs in the Fortune 500 are Black — 0.8% of top executives.

Women are similarly underrepresented in positions of authority. And McKinsey’s researchers note that when women do gain executive positions, they are often in staff roles rather than top-level ones. Women of color, the McKinsey report found, “may suffer a double burden of bias that keeps them from the uppermost levels of corporate leadership.”

In most organizations, according to Mercer, McKinsey and other researchers, the lower down the ladder you look, the more you find people of color.

Experts in workforce diversity and inclusion say the disconnect between the business case, the rhetoric and reality demonstrates how tricky it can be to untangle the interlacing of race, power, culture and inclusion in the workforce. Doing so takes time, attention and focus.

“These are complex, messy issues that are generations in the making,” says Zur.

Businesses that want to break through these roadblocks need to work to build a workplace that invites, welcomes and engages people from many different backgrounds and perspectives. That’s not always easy.

“Culture happens by default or it happens by design, and our default operating code is largely white,” says Tiffany Jana, founder and CEO of Richmond-based TMI Consulting Inc., a diversity and inclusion management consultancy firm.

By recruiting and hiring without intentionally looking outside that default, workplaces often miss qualified candidates. Norms such as preferring candidates from “reputable institutions,” who graduated from the same schools or who offer “a good fit,” rather than making judgments on potential and ability, usually result in workplaces that resemble their managers, Jana says.

To offset this, hiring managers can strengthen and expand their networks. For example, Jana — who identifies as nonbinary and uses they/them pronouns — points out that almost every industry and profession has demographically specific organizations associated with it. “Offer to sponsor a conference,” they suggest. “Build relationships.”

Another tip: Make sure photos on websites and recruiting materials reflect the organization you want to build. Few people are willing to be the first person like them to join a company, says Jana, who was on Inc. magazine’s 2018 list of the nation’s top leadership speakers.

Once people are on board, experts say, workplaces need to put in place practices that welcome participation and input from all members.

Hiring people without planning for, encouraging and celebrating their active participation is counterproductive and demoralizing, Jana says: “If you can’t say specifically how groups are going to improve your organization, you’re going to ignore them or ill-use their talent and perspective.”

At the same time, managers should be careful not to rely on members of underrepresented groups as spokespeople. Inequity “is a collective problem and needs a collective solution,” says Hall of Virginia Tech. People with “social and political capital” need to be part of discussions rather than asking members of minority groups to solve these problems, she adds.

‘Actions speak louder’

One method to address the complex situation is building intentional networks like Richmond-based Dominion Energy Inc.’s employee resource groups, or ERGs, launched in 2013.

The utility currently has eight ERGs, each of which is focused on an ethnic, cultural or social identity such as African Americans, Hispanics, people with disabilities and LGBTQ people. Each group has an executive sponsor but is created and managed by employees.

When Faby Helme took a full-time job with Dominion four years ago after graduating from college, she joined all eight groups.

“I loved learning about not only the company but about the different groups,” says Helme, whose parents are from Guatemala and Bolivia. Besides, “it was a really good opportunity to network.”

In time, Helme, an emergency preparedness specialist, cut her participation back to a few ERGs and joined the Hispanic group’s board. “It just brings me so much joy to be able to bring myself and my culture to the workplace,” she says.

About 15% of Dominion’s 19,000 employees are in an ERG. The groups often serve as sounding boards for topics such as recruiting, community engagement and professional development, says Darius Johnson, Dominion’s vice president for employee engagement and development.

“Part of what will help us — not just Dominion, but as people — is to interact with each other, to learn from each other, to interact together … to deal with challenges and understand blind spots,” Johnson says.

Dominion has chalked up a strong record for diversity and inclusion efforts, repeatedly making Forbes’ list of Best Employers for Diversity and the Human Rights Campaign’s Corporate Equality Index.

In June, Dominion was one of the first major Virginia corporations to speak in support of racial protesters. It donated $5 million to support social justice and racial equality causes and to assist minority-owned small businesses in 20 states. Dominion followed that up with a July commitment to donate $35 million over the next six years in support of historically black colleges and universities (HBCUs) and scholarships for minority students.

“At Dominion Energy, we have a saying that  ‘Actions Speak Louder,’” Dominion Chairman, President and CEO Thomas F. Farrell II said in a statement. “We share the anger of our communities at the unjustified deaths of Breonna Taylor, Ahmaud Arbery and George Floyd. … We are investing in recovery and reconciliation, and in the vital work of overcoming years of debilitating actions, attitudes and abuses of authority that have traumatized our country.”

At the same time, however, Dominion’s hard-charging approach — sometimes, critics charge, at the expense of low-income and minority communities — has earned it a reputation for insensitivity.

Dominion’s aborted $8 billion-plus Atlantic Coast Pipeline project included a plan to build a compressor station in Union Hill, a historically Black area of Buckingham County founded by freed slaves following the Civil War. Community members battled the project, upset about the potential for air pollution. In January, the Fourth Circuit U.S. Court of Appeals revoked the station’s permit, saying that Virginia’s Air Pollution Control Board did not adequately consider how the station would disproportionately affect the minority community. Dominion and Duke Energy canceled plans to build the pipeline in July, citing concerns over unrelated federal court rulings likely to prove problematic to the project.

Conflicting messages such as those can complicate companies’ efforts to advance fairness, diversity and equity.

Nonetheless, diversity experts say, implementing a diversity strategy is not only good business, it’s the right thing to do.

“We are very intentional about our financial plans and business strategy, but we leave our culture to chance,” says Jana.

That, they add, is a mistake — particularly now, when the world’s attention is focused on race, justice and equity. “This is definitely a sea change. The only way to do it is to do it. There isn’t a shortcut.”

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