Read: Diversity and inclusion is good for business

Diversity, inclusion and wellbeing are words you hear a lot in the context of business culture. But they’re much more than idealistic, ‘good-to-have’ options in a company’s strategy. Recently, the UK law firm, Shoosmiths, hosted a roundtable with the Chartered Institute of Credit Management (CICM) and a number of organisations who have already committed and are on a journey to making diversity and inclusion a key part of their business strategy. The discussion underlined that they see progress and a diverse organisation as an essential prerequisite for success in today’s commercial world. 

For those attending, there was a clear sense of the powerful role that employers can play in driving levelling up and equality of opportunity through a focus on diversity. However, the discussion also strongly highlighted the clear and ever more compelling business case for diversity.

Research has shown that a robust diversity & inclusion strategy, well-integrated into the overall aims and values of a company, makes good business sense. There is clear evidence that the most diverse companies are more likely to outperform less diverse organisations in terms of profitability. Analysis by McKinsey published in 2020 showed that companies in the top quartile for gender diversity on executive teams were 25 per cent more likely to have above-average profitability than companies in the fourth quartile, up from 21 per cent in 2017 and 15 per cent in 2014 when they carried out similar surveys. Moreover, the greater the representation, the higher the likelihood of outperformance. In terms of ethnic and cultural diversity, its business-case findings also showed that, in 2019, top-quartile companies outperformed those in the fourth by 36 per cent in profitability, slightly up from 33 per cent in 2017 and 35 per cent in 2014

Behind those numbers sit the benefits that drive them – diverse organisations can better avoid groupthink and be more innovative. Businesses with better gender, ethnic, cultural and socio-economic representation are more reflective of the communities they serve and tend to make more perceptive and creative decisions. They can effectively tap into talent from a far wider talent pool than their competitors and as a consequence provide a dynamic, stimulating environment, which doesn’t just help better decisions but also makes them more likely to retain their staff who are more engaged and, as a result, feel and perform at their best. 

The businesses at the roundtable acknowledged that bringing in different people can initially feel like a step out of a comfort zone but ultimately diversity is how innovation best happens. And it was also highlighted that for future leaders, learning how to build and lead diverse teams earlier in your career is crucial to seeing leadership talent develop.

Rt Hon Justine Greening, Chair of the Purpose Coalition, who also attended the event, said: “The best organisations, including those who attended the roundtable, have already recognised that an authentic diversity and inclusion strategy makes good business sense and have put it at the heart of their efforts to deliver real equality of opportunity for their colleagues, their customers and their communities. It will ensure that they make the best use of the talent that is available from all backgrounds and will play their part in levelling up the country.

“Measurement and evaluation are key to ensuring that any gaps can be identified and work undertaken to close them, breaking down the barriers that still exist for too many people, particularly from disadvantaged backgrounds. That transparency also encourages a willingness to tackle issues openly.

“The Levelling Up Goals, developed by the Purpose Coalition in collaboration with its partners, provide a framework that enable organisations to benchmark what they are doing to deliver positive social impact at key life stages, alongside other barriers to opportunity such as good health and wellbeing and also extending to issues like open recruitment and fair career progression. They help identify the solutions to these issues and, crucially, they also allow organisations to plug in to the Purpose Coalition network, sharing experiences and best practice as well as demonstrating thought leadership. This creates a powerful collaboration of leaders committed to change. The hosts of this week’s roundtable, Shoosmiths, are one of the founding partners of the Coalition and are now in the forefront of helping to shape the levelling up agenda to improve social mobility outcomes in the UK.”

Simon Boss, CEO of Shoosmiths, said: “Leading on equality of opportunity, diversity and inclusion is not just about “doing the right thing” – although it is definitely that. It is just as much about doing the sensible commercial thing for any business. At a time when the battle for talent has never felt as intense as it does now, businesses that genuinely create opportunity for all and attract, grow and retain talented people will clearly gain commercial advantage and an enhanced profit line. And quality attracts, building long term sustainable value for all stakeholders. At the same time, it matches the expectations of future and present employees, owners, clients, customers and regulators – pretty much everyone. Put simply, the multiple social and business benefits of doing the right thing by people whatever their start in life or characteristics has never been clearer”

Sue Chapple FCICM, Chief Executive of the Chartered Institute of Credit Management, said: “When phrases like ‘levelling up’ , “social mobility”, “ED&I” are bandied about in business, they can sometimes be overlooked as the next fad or topical management speak. When you cut through the language, what they really mean – is ensuring that the individuals who work across all businesses at all levels – are fully representative of the businesses, clients, customers and communities they serve. This makes good sense for everyone – the earlier we can get the messages about opportunities out – into schools, colleges, and workplaces, the sooner we will see the small trickle of change, turn into a torrent of hope, optimism and practical solutions across business and society for now and the future. The benefits of doing the right thing have never been more pertinent and it is exciting to see the progress already being made across the Credit Management and Collections Industry”

The following organisations attended the roundtable:

Shoosmiths

CICM

The Purpose Coalition

American Express

Hays

Britvic

Royal Mail

Coface

Menzies

BPP University

Small Business Commissioner