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Put your money where your mouth is!

Category: Pro-Opinion, Diversity & Inclusion, Money

Put your money where your mouth is!

I have a tendency to try and look at situations with a heavy dose of common sense and simplicity. I prefer to go light on the waffle, management speak, and BS - I did say try!

It is with this in mind that I started to wonder whether organisations are really putting their money where their mouth is when it comes to Diversity & Inclusion.

What is the true cost of getting it wrong? Always a good question, yet it always astonishes me how far organisations go to avoid understanding the true costs. (Yes, I do mean they avoid knowing accidentally on purpose!)

I can almost hear the Diversity folk amongst you reciting the tried and tested mantra; “higher staff turnover, higher recruitment costs, loss of reputation, poor product design decisions… blah, blah, blah”.  Of course, none of that is wrong, but I’ve always had a sneaky suspicion there is a common sense formula that could be applied to really test whether an organisation, pardon the expression, gives a **** (insert your preferred expletive) about Diversity & Inclusion.

After thinking about how Diversity is often funded, I’ve come up with the following litmus test….here goes:

An organisation that spends more on equality related employee relation costs than it provides for the diversity budget is more interested in supporting discrimination than improving equality.

Now although it seems a narrow definition, (and maybe the more tender hearted will say harsh) let’s explore the logic a bit more and test the resolve of those reading to go back to their organisations and apply the test.

First, let’s deal with those who want a definition of equality related employee relation costs….I’m all for clarity too, so let’s give it a go.

Equality related:

  • Discrimination (Race, Sex, Gender… so on and so forth)
  • Bullying and Harassment
  • Failure to make reasonable adjustments
  • Victimisation
  • Equal pay (the lack thereof!)

Employee relation costs include:

  • Compromise agreement payments
  • Costs of Tribunal cases (legal costs)
  • Costs of tribunal fines
  • Time used by HR staff
  • Sickness absence costs due to equality related grievance procedures
  • Settling Equal pay disputes

Happy enough? I think it’s workable……so ask yourself the following:

1)      Do you as a diversity manager know what your organisation spends every year on equality related employee relations costs?

2)      When the board considers diversity funding does it target a reduction in Equality related ER costs in proportion to the budget provided for the diversity team (or diversity person)?

3)      Are your managers/directors/board members given performance targets which aim to limit equality related ER costs?

4)      Is performance related pay for management affected by the costs of equality related ER payments?

I imagine for many of you the answer to all the questions above will be “no.”

Discussing this idea with an HR professional they came up with the phrase that prompted this article.....…“It is the cost of doing business.” ….

And there it is in a nutshell……….

I’m willing to bet that many organisations are far happier to pay larger sums of money in order to continue discriminating than they are providing funding to progress equality.

Brave enough to test the theory with your organisation?

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VERCIDA works with over one hundred clients who are committed to creating an inclusive work environment. If you are an employer and interested in working with VERCIDA to promote your diversity and inclusion initiatives and attract the best candidates, please email [email protected] for more information.

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