What is the most common reaction of a business leader when discussing diversity and inclusion? “Our HR department is dealing with it”. Across all company sizes, across all industries, CEOs and Managing Directors immediately task their HR department to handle the diversity and inclusion question. The fact is, as soon as diversity is passed onto HR, it gets deprioritized and this is where diversity and inclusion initiatives fail. So why do business leaders assign diversity and inclusion to HR in the first place? And why is this counterproductive? More importantly, what should be done instead?
Why do business leaders assign diversity and inclusion to HR?
1) It is convenient
As a busy CEO or Managing Director, the easy route is to delegate projects to other people. Most business leaders go into delegation mode as a way to cope with the amount of responsibilities they carry. Delegation works and is even necessary for CEOs and Managing Directors to be able to scale the business. However the Senior Leadership Team must take personal ownership of strategic projects. Delegating diversity and inclusion to HR means immediately deprioritizing the topic as “just another project”.
2) Business leaders misunderstand diversity and inclusion
Most business leaders misunderstand diversity and inclusion. The common perception is that it is a charitable thing to do, a moral imperative, the right thing to do. Since diversity and inclusion is perceived as a charitable project, it gets associated with ‘corporate social responsibility’ and it gets immediately passed on to HR to deal with it. It is not seen as a strategic business advantage.
3) Business leaders prioritize what they perceive as strategic
Busy CEOs work on what they perceive as strategic business imperatives. Senior Leadership Teams prioritize sales forecast, strategic operations, product launches and usually anything else is delegated to other teams. Since many business leaders think of diversity and inclusion as a charitable thing to do, they prioritize it and they focus on what they believe is mission-critical to the business.
4) It feels overwhelming and out of their comfort zone
Senior Leadership Teams feel overwhelmed by the very topic of diversity and inclusion, as well as out of their comfort zone. Many CEOs would rather avoid the topic altogether and not get involved with it out of fear of saying the wrong thing, doing the wrong thing. It is a very common belief for CEOs and Managing Directors that diversity and inclusion is uncomfortable, it is difficult, it is perhaps political, it is also embarrassing and anything they can do to delegate this topic to someone else will be done, as long as they don’t have to deal with this overwhelming topic.
Why is this counterproductive?
1) Diversity becomes tactical
The very instant diversity and inclusion is assigned to the HR department, it becomes a HR project instead of a strategic business goal. As a result, diversity and inclusion is not part of the daily agenda of the Senior Leadership Team and is not part of any strategic plan. HR Leaders start working in silo from the Senior Leadership Team and there is no urgency, no momentum and this is where the initiative slowly starts to die on someone’s desk.
2) Lack of budget and authority
When diversity and inclusion is assigned to HR, it simply lacks the budget and the authority to become successful. Assigning it to a department means that it won’t get the support it needs to become a strategic business initiative and it will become a side project, just like partnering with charities, that gets tactical wins at best and gets constantly deprioritized in most cases. Assigning diversity to HR creates additional bottlenecks because each time a decision needs to be made, it has to go through a series of steps just to get sign-in and this significantly hinders any chance of significant advancement.
3) Constant deprioritization
Assigning diversity to the HR department means constant deprioritization. Like any other side project that is assigned to a specific department, it lack the executive sponsorship it needs to make significant progress. The perception it creates as ‘just another HR project’ immediately creates a lack of urgency and it simply won’t get the attention it gets to be successful.
What should be done instead?
1) Assign diversity to a Senior Leadership Team member
Diversity and inclusion should be assigned to one Senior Leadership Team member. Whether it is the CEO themself, or the COO, or the CRO, diversity and inclusion must be owned by one member of the Senior Leadership Team. That business leader should have personal diversity goals that are tied to monetary compensation and this should be at least 30% of their overall bonus. All Senior Leadership Team members should also have diversity goals tied to monetary compensation. This sends a clear message that diversity and inclusion is a strategic business priority and the Senior Leadership Team should treat it as such, as part of their daily discussions.
2) Create a diversity taskforce sponsored by an executive
Creating a diversity taskforce, which is sponsored by an executive, will ensure constant monitoring, evaluation and improvement of the diversity and inclusion initiatives. Having an executive leader in this taskforce will give it the budget, the authority and access to resources it needs to make an impact. You can choose how many people are part of the taskforce and who will be in it and how often they will meet. What is important is that you set-up a taskforce that is sponsored by an executive and you clarify their goals. This taskforce goals should be aligned with your diversity and inclusion goals.
3) HR should be a partner, not the owner
The HR department should become a partner but not the owner of the diversity and inclusion initiatives. HR leaders should provide input and feedback and be part of the regular meetings to discuss the progress of the diversity and inclusion initiatives. However, it is critical that the owner of the diversity and inclusion initiatives remains the Senior Leadership Team executive at all times so that the programme is always treated as a strategic business goal and does not become a side HR project.
For diversity and inclusion to succeed, it is critical that business leaders own it and set personal diversity goals tied to monetary compensation. HR should be a partner and provide input and feedback but HR should never own the diversity and inclusion programmes if the business wants to see significant results. The CEO or Managing Director should also have personal diversity goals tied to monetary compensation. Diversity and inclusion should always be treated as what it is: a mission-critical business imperative.