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Does Data Disclosure Drive DEI Progress?
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Since 1966, the Equal Employment Opportunity Commission has required U.S. companies with more than 100 employees to disclose the racial, ethnic and gender composition of their U.S. employee base in annual EEO-1 reports. PHOTO: ANDREW HARRER/BLOOMBERG NEWS
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Welcome back. I'm Carolyn McGourty Supple, a former journalist and business consultant who now heads the Center for Ethical Leadership in Media. I write a monthly column focusing on evidence-based ways to build a better workplace.
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Over the past decade, a number of companies have moved toward disclosing their workforce’s demographic data, seeking to be more transparent and to signal a commitment to diversity, equity and inclusion.
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But does disclosure of diversity data lead to a more level playing field?
According to Iris Bohnet, a behavioral economist at the Harvard Kennedy School, while data disclosure and transparency are important, evidence demonstrates they aren’t enough to motivate significant and sustained behavioral change on DEI.
“Collecting the numbers is helpful to diagnose the problem,” Ms. Bohnet said. Yet without specific and measurable goals, data disclosure won’t lead to meaningful insight or action, she said.
Some shareholders, employees, unions and activists have demanded more disclosures from companies, arguing that revealing data around an organization’s employee makeup will hold companies accountable to issues such as pay equity and racial and gender diversity.
Still, this debate is not new, and evidence suggests that sharing the numbers alone does not lead to more inclusive workplaces.
Since 1966, after the passage of the Civil Rights Act, the Equal Employment Opportunity Commission, or EEOC, has required U.S. companies with more than 100 employees to disclose the racial, ethnic and gender composition of their U.S. employee base in annual EEO-1 reports. The EEOC uses the data internally to inform employment discrimination cases. Corporations don't have to disclose the data publicly.
Despite recent disclosures by businesses such as payments company American Express Co., wireless company T-Mobile US Inc. and tech giant Apple Inc., the number of companies that share their data publicly are few.
Don Tomaskovic-Devey, a professor at University of Massachusetts Amherst who studies workplace inequality, analyzed decades of EEOC data, finding that the composition of the U.S. workforce has changed since the 1960s and 1970s to include more women and non-white workers. Despite the progress, these individuals don’t rise into managerial or leadership roles at the same rate.
Mr. Tomaskovic-Devey said the EEOC should do more to help companies interpret their data with some sort of report card that benchmarks them to their peers, even if it isn’t made public.
He also points to evidence that transparency around specific challenges—such as a company disclosing information about its pay gap—empowers internal stakeholders to solve them.
To make progress on DEI, companies must treat it with the same seriousness as other business metrics, he said.
“My core feeling is that firms measure things they care about,” he said.
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Consider how leadership at Snap Inc. approached this issue. When Oona King arrived at Snap to lead its diversity efforts as vice president of DEI in 2019, her first move was to develop a comprehensive strategy to ensure the technology company was building a healthy and inclusive work environment. DEI data was an essential pillar in the plan.
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Working closely with its chief executive, Evan Spiegel, the company released its first annual diversity report in 2020. It shared the composition of the workforce by race and gender, including at the leadership level. It also noted promotion, hiring and attrition rates. The plan provided a foundation to understand the company’s weak spots and areas where it needed to change. In 2021, Snap released a second DEI report, measuring progress against the prior year’s numbers.
Mr. Spiegel went through the initial plan with a “fine-toothed comb,” she said.
“Leaders set the tone and must take this work as a business imperative, otherwise it’s guaranteed to fail,” Ms. King said.
Snap’s numbers around gender and racial diversity signaled a more systemic issue about pathways into tech: The majority of tech workers, particularly technical leaders, were white and male.
With the backing of Mr. Spiegel, Ms. King convened a group of experts for a year to develop recommendations for transforming DEI outcomes in tech. The result was the ACT Report, released in 2021. The report’s authors emphasize the importance of company reporting with DEI data, metrics and goals, and recommended collaboration with peers to come together as an industry to align on data collection and reporting, as well as other interventions.
A few other initiatives also track diversity data at entry, midcareer and leadership levels in corporate workplaces, publishing reports, and convening the industry.
McKinsey & Co. and LeanIn.Org’s “Women in the Workplace” study of over 400 North American companies has found year after year that women enter the workforce near parity with men but then drop off at every level of the pipeline to leadership, at which stage they only occupy a fraction of top roles.
The Bloomberg Gender-Equality Index analyzes data from over 400 companies, and found a similar pattern.
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Continued below: Pursuing a company’s diversity goals; workers are coming back, and coming out, at the office
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CONTENT FROM OUR SPONSOR: Indeed
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5 Big Trends Shaping the Future of Recruitment and Hiring
From interviews to screening, here’s how companies must evolve their hiring practices.
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Research Spotlight: Pursuing a Company’s Diversity Goals
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BRIAN STAUFFER
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Iris Bohnet, a behavioral economist at the Harvard Kennedy School, suggests that setting organizational DEI goals and creating accountability for achieving them are evidence-based ways of pursuing a company’s diversity goals. Further, for stakeholders to make sense of the numbers and leaders to know what to do, the data must be relevant, accessible and comparable–such as in a simple, customizable dashboard tailored to its intended users.
Ms. Bohnet also stresses that a sophisticated data-collection and analysis team empowered by the human-resources department will still need an executive champion—such as the CEO—to back DEI initiatives.
In separate research, Dr. Bohnet and her Harvard colleague, Siri Chilazi, also take a crack at the problem of fewer women moving up the corporate ladder. They suggest applying the gender proportionality aspiration (GPA) that “stipulates that the ratio of women to men at any level in a company should be at least proportionate to the ratio of women to men at the level below.”
Access the full report.
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From Hire to Retire: The Changing Job Market
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🎧 LISTEN: How do you navigate your career during this time of uncertainty? In this "As We Work" episode, columnists Rachel Feintzeig and Callum Borchers answer your questions on the changing job market, including how to get ahead when a lot of the workforce is still at home and if a potential economic downturn could signal the end of the Great Resignation. Listen here.
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Workers Are Coming Back, and Coming Out, at the Office
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Randy Askins chairs an LGBT group at the car-rental company Hertz. PHOTO: OLIVIA WILD
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When Mikal Kelaidis took a new sales job a few months ago and started going back into an office, he came out as gay at work.
Like many whose professional and personal lives blurred during the pandemic pause of office life, Mr. Kelaidis says he’ll no longer stay closeted from 9 to 5. He came out to friends and family a decade ago, but worried that overt or unconscious biases on the job could hinder his career. Now he’s less concerned.
“I don’t have the energy to wear a mask,” says Mr. Kelaidis, 31 years old, who works in a conservative part of Utah. “People can deal with it.”
There is no official measure of on-the-job comings out, but LGBT workers and colleagues who support them generally agree that people are more open about their sexual and gender identities in the postpandemic workplace, mirroring a societal trend. In a recent Gallup survey, 7.1% of American adults identified as LGBT, up from 5.6% in 2020.
Many LGBT workers say they’re usually, though not always, well received. A smaller subset are seeking more from their employers, pushing beyond tolerance and urging companies and co-workers to advocate for them.
“There’s been a turning point in the way people have integrated their work selves and their personal selves,” says Alexandra Brooks, accounting chief at Hertz, where a group for LGBT employees and allies has tripled its membership since the start of the pandemic.
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How LinkedIn Redesigned Its Flagship for Hybrid Work
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At LinkedIn's new flagship office, desks are no longer the primary focus. With dozens of different work settings and conference room setups, the company is using its office as a hub for its hybrid workforce. Watch the video.
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