Learn five common threads among companies successfully scaling up diversity, equity, and inclusion initiatives.
By Real Leaders
In a global environment characterized by high volatility and rapid change, embedding diversity, equity, and inclusion in organizations and economies is increasingly important for sustainable growth, resilience, and fairer economic outcomes, the World Economic Forum says.
The forum’s DEI Lighthouse Program, hosted by the Center for the New Economy and Society, is an annual effort to identify proven, effective corporate DEI initiatives from companies across industries and geographies. At a time when DEI is generating a lot of attention, the aim of the program is to steer pragmatic, global, impact-oriented action to close existing economic gaps. By equipping leaders with best practices, DEI efforts can be focused on what works best and ultimately shape more resilient and inclusive economies.
Embracing DEI is not just a moral imperative, but also a strategic one that promotes sustainable growth and builds agile and flexible organizations capable of weathering global risks and challenges, WEF states. Extensive research underscores the long-term benefits of inclusive policy-making, business strategies, and sustained diversity programs in the private and public sectors.
The recently published report, Diversity, Equity, and Inclusion Lighthouses 2024, shares key lessons learned with business and public sector leaders around the world. Seven corporate initiatives were selected as DEI Lighthouses for the impact they have achieved: Banco Pichincha, Heineken, HKEX (Hong Kong Exchanges and Clearing Limited), Ingka Group (IKEA), McKinsey & Company, PepsiCo, and Salesforce. Five common threads were identified among them.
Success Factors Across DEI Lighthouses’ Initiatives
1. Nuanced understanding of root causes. Understand the problem with a deep fact base, identify the root causes, get input from the target population initially and throughout the process, and prioritize and sequence problem areas.
2. Meaningful definition of success. Set clear and quantifiable aspirations (when and by when), and articulate a clear case for change that moves employees to action.
3. Accountable and invested business leaders. Set initiative as a core business priority; hold senior leaders accountable for outcomes, not just inputs or activities; model and lead desired change, starting with the CEO and senior leaders; and ensure resources for longevity are in the budget, expertise, and timeline.
4. Solution designed for context. Develop solutions that address the root causes with scalability in mind, integrate changes into key processes so impact is sustained, and equip and encourage employees to contribute.
5. Rigorous tracking and course correction. Define KPIs, implement a rigorous tracking process, and use data and feedback to course-correct as needed.
A Closer Look
Here’s a deeper dive into three of the 2024 DEI Lighthouse Companies.
More than a decade ago, the Ingka Group — owner of IKEA — committed to achieving gender parity across its entire business. Ingka Group developed tailored approaches for each business unit and country, created mentorship programs, and launched inclusive succession plans. It also introduced gender-neutral salaries and corrected the pay gap. DEI goals are tied to each team manager’s talent reviews, with a DEI leader in every region appointed to ensure KPIs are met. The organization achieved 50/50 gender and pay equity across all its operations.
At Ingka Group, 48% of country CEO positions and 50.2% of all manager positions are occupied by women. The company introduced a gender-neutral salary review facilitated by an external auditor. Gender parity targets have been adopted globally. The Ingka Group also implemented local initiatives adapted to specific regional contexts, including on-premises childcare services to support working mothers in several countries in Asia.
McKinsey & Company launched a reboarding program that ensures all colleagues (men and women) are supported in their return from leave greater than 12 weeks while reducing attrition gaps between them and the rest of the firm. The program was formally implemented across all its European offices in 2019, spanning 29 countries and 56 offices, and successfully scaled globally in 2022.
After analyzing its internal retention metrics, McKinsey & Company observed higher attrition rates among mothers returning from leave compared to the rest of the workforce. Drawing on its research and from the lived experiences of parents in leadership and consulting roles, the program has seen a 20% decline in attrition among EU consultant mothers returning from leave. McKinsey & Company suggests crafting a holistic program that touches on multiple aspects of the employee journey, designing a minimum offering that each local team can own, securing sufficient resources, and establishing clear success metrics that can be tracked.
As a market regulator for more than 2,600 companies listed in Hong Kong, HKEX (Hong Kong Exchanges and Clearing Limited) is leveraging its regulatory capabilities to promote good corporate governance and strong environmental, social, and governance management among all issuers by setting robust disclosure standards, rules, and regulations. By making it mandatory for listed issuers to have at least one female director on their board, the company is showcasing the important role that regulation can play in advancing gender parity in leadership positions.
As a result of these efforts, the percentage of female directors on boards of listed issuers increased from 14.6% in 2020 to 17.3%, while the percentage of listed issuers with no female directors decreased from 31.5% in 2020 to 21.4%. This policy will pave the way for some 550 female board positions in Hong Kong to be filled by the end of 2024.
Learn MoreRead the Diversity, Equity, and Inclusion Lighthouses 2024 Insight Report by the World Economic Forum here.
