Why Diversity Programs Fail

In the past two decades, diversity and inclusion programs have become a mainstream piece of the corporate structure. Companies today proudly tout diversity metrics on their websites and highlight their commitment to inclusion in job postings and media stories.

Still, despite all of these efforts, the number of racial and sexual harassment complaints filed to the U.S. Equal Employment Opportunity Commission, or EEOC, continues to rise. And while many of these claims come from smaller organizations that may not have comprehensive diversity practices, it is not at all uncommon to see major global brands making similar headlines.

In June 2015, for example, Wal-Mart Stores East, the eastern division of the globalretailer, paid $75,000 to settle an EEOC religious harassment and retaliation lawsuit after a Gambian and Muslim asset protection coordinator reported systematic harassment by his store manager, who frequently made offensive comments about the employee’s national origin and religion, mocked his accent, and said things like, “All Muslims do is blow up buildings and people.”

That same month, United Airlines paid more than $1 million to settle a class-action EEOC lawsuit in response to claims that the airline discriminated against employees with disabilities by forcing them to compete for vacant positions in order to keep working.

And earlier this year, Ford Motor Co. earned headlines for an EEOC investigation of sexual harassment claims in a civil lawsuit, originally filed by four women in November 2014. The lawsuit, now filed at the behalf of 33 people, states that the they were discriminated against and subjected to gross racial and sexual harassment, including lewd and demeaning remarks, groping, fondling and requests for sexual favors.

These lawsuits occurred despite the fact that every one of these companies has long-standing diversity programs that include a corporate vision for inclusiveness, zero tolerance for harassment, and annual reports demonstrating their ongoing success in this space. 

So where are these companies going wrong? More important, what lessons can other organizations learn from their experiences?

Diversity Isn’t a Box to Check
Even though EEOC lawsuits are still prevalent, it’s not all bad news, according Seth Halpern, a partner at Malkinson and Halpern, an employment law firm based in Chicago. “We are seeing fewer sexual harassment claims than we used to, because there is a much stronger awareness of what you can and cannot say and do in the workplace,” Halpern said, adding that retaliation claims, in which an employer fires, demotes or otherwise “retaliates” against an employee who files a charge of discrimination, are on the rise.

In fact, the EEOC’s latest private sector data show that while the total number of discrimination claims filed in fiscal year 2014 decreased overall compared with previous years, claims alleging retaliation reached a record high, accounting for nearly half of all claims that year. Race, sex disability and age-related claims round out the top five reasons of EEOC complaints.

Halpern said large and small companies face different pitfalls when it comes to ensuring a diverse and inclusive culture. “Smaller, privately held or family-owned businesses don’t always invest in training and creating policies to support diversity,” Halpern said. “Unless you have someone at the top who really cares about these issues, there is often a ‘don’t tell me what to do’ attitude.”

In those cases, it usually takes an expensive lawsuit to spur these companies to action, Halpern said, and even then it is treated more as a box to check than a culture-change initiative.

Whereas larger institutions today have invested in building policies and procedures to support diversity, the problems these organizations face usually occur in small pockets of the business that are ruled by a few midlevel managers.

“If you’ve got one jerk in charge who thinks it’s funny to shown porn to his assistant or make racist jokes, that is where the claims tend to arise,” Halpern said. 

These kinds of rogue miscreants can be harder to weed out, said Anise Wiley-Little, chief human capital and diversity officer for Kellogg School of Management at Northwestern University.

“All it takes is one individual to make a bad decision, and I don’t think that you can avoid that completely,” Wiley-Little said. “However, if you build a diversity strategy that is business-focused and integrated into the corporate culture of the organization, you lower your risk.”

More Than Words
Whether big or small, the fundamental solutions are usually the same: deliver effective training, establish clear and strong policies, and make sure the leadership team is willing to act decisively when problems arise, regardless of who’s involved.

“You can’t waiver on diversity because someone is a high performer,” said Traecy Smith, director of diversity for the One Club, a New York-based advertising nonprofit. “You have to create an environment where everyone understands that this is not just a policy, it is what we believe in, and if you step outside of that, we will take action.”

Sometimes it takes someone getting reprimanded or fired for employees to believe the diversity vision is something they need to take seriously, said Pamela Culpepper, chief people officer for Golin, a global PR firm headquartered in Chicago.

“In a lot of organizations, people will continue to do what they always did until there is a negative consequence,” said Culpepper, who is also the former chief global diversity officer at PepsiCo Inc. “But when leadership shows a willingness to remove someone, regardless of how productive they are, it sends a reverberating message that this kind of behavior will not be tolerated.”

“Companies also need to stop thinking about diversity as a stand-alone compliance issue,” Wiley-Little said. “You have to embed your diversity strategy into all of your organizational vision, training and leadership accountability.”

That’s the only way it becomes part of the business process and not just a separate HR issue to contend with.

Build Alliances
When Wiley-Little joined Kellogg in 2014, she began by building a vision for diversity that aligned with the organizational goals of the university. These include attracting top students from all over the world, accelerating the school’s global reputation and delivering a high-quality executive education.

“These are all business goals, not diversity goals,” Wiley-Little said. But by aligning her program with these business objectives, Wiley-Little said she is able to tie diversity to organizational performance.

This is important because it helps to change the way employees think about the value of diversity as a business tool. “It’s not about avoiding negative behavior. It’s about looking at how we can achieve our business goals through the lens of diversity,” Wiley-Little said.

Wiley-Little said she also works closely with the leaders of every department to help them see how the diversity program goals fit into their short- and long-term business strategies. Whether it is how the marketing department positions the Kellogg brand, how recruiters assess employees and students or how course content reflects a variety of views, the diversity program has a place in every aspect of the organization.

“It is important as a diversity leader to continually study the business and to make sure you have deep partnerships with business-unit leaders,” Wiley-Little said. “That’s how you keep diversity fresh, and build alliances across the organization.”

For organizations that employ unionized workers, these alliances should extend to union leaders. “There is often a sense that because someone is in a union they can’t be disciplined,” Culpepper said. That can lead to disruptive behavior that eventually results in an EEOC lawsuit.

To avoid such breakdowns in the corporate culture, unions and management need to treat each other as partners and establish a united front when it comes to matters of diversity and inclusion.

“They need to work together to identify areas where there will be no debate about repercussions,” Culpepper said. “Then they need to put that message out to their employees and members.”

To further engrain diversity into the corporate culture, Culpepper said diversity training should be integrated into all learning initiatives and programs, rather than existing as a separate set of courses and programs.

She said PepsiCo had two different organizational groups: one for training and development and another for diversity and inclusion, which is fairly common in big organizations.

As a result, most of the diversity training occurred separate from other training, which meant trainees would be less likely to connect what they learned in diversity training to specific on-the-job tasks.

For example, a course on performance reviews wouldn’t talk about unconscious bias, so it would be left up to managers to recall that lesson from their diversity training when handing out salary increases or deciding whether a young mother should be given a promotion.

“If you integrate unconscious bias into the rest of your training programs, employees are more likely to double check what is going on in their heads before making decisions,” Culpepper said.

All of these strategies can help organizations build a better, more inclusive diversity culture. However, there will always be the chance that a rogue racist or sexist ends up in a leadership role.

In those cases, companies need to have an environment where people feel safe reporting on bad behavior. “Diversity leaders can’t be everywhere,” Culpepper said, “and they aren’t always around to hear what’s going on.”

So they have to be able to rely on local managers and employees to defend the policy for the organization. That will only happen if everyone in the company has the tools to make such complaints as well as the confidence that they will be taken seriously without fear of retaliation.

“For diversity to work, everyone has to defend it,” Culpepper said.