Firms that take steps to improve diversity in the workplace earn real business benefits, a joint report from the CBI employers organisation and the Trades Union Congress suggests today (Tuesday).
Companies who look beyond the “usual suspects” for staff and employ people on the basis of their abilities and potential, regardless of their sex, race, age, disability, sexual orientation or religion can benefit in many ways, including:
- Higher morale and productivity, improved retention rates and lower recruitment costs
- Better understanding of customers’ needs and greater insight to reach untapped markets
- Help in addressing skills shortages.
The report, Talent not Tokenism, shows that promoting diversity need not be expensive, complex or a legal minefield for business. And it identifies some key ingredients for bringing about change, including leadership from senior management and employee involvement, especially through unions and other workforce representatives.
It also makes clear that diversity can be improved through positive action - such as removing bias against older workers, developing strong links with local communities and offering flexible shift patterns to help working parents – not positive discrimination.
The report is being launched tonight (Tuesday) by the director-general of the CBI, Richard Lambert; the general secretary of the TUC, Brendan Barber; Trevor Phillips, chair of the Equality & Human Rights Commission, which supported its production; and the Minister for Women and Equality, Harriet Harman.
The report contains a dozen case studies featuring businesses of all sizes that have developed a more diverse workforce.
They illustrate how companies, from small family-run firms to multinationals like IBM and GSK, have improved their workplace diversity and the advantages in doing so. The report also contains tips and advice from senior executives at ten leading companies, including BT, PricewaterhouseCoopers, Barclays, and Shell.
- Pinsent Masons solicitors’ positive approach to lesbian and gay equality, including working with suppliers to improve their diversity, has won it lower staff turnover and attracted new clients. Its lawyer turnover rate has fallen from 17 to 12%, a substantial saving when losing a solicitor costs a law firm an average of £110,000.
- Transport company Arriva works with its trade unions to deliver innovative training so that all staff are valued at work and treated fairly. It has sent 5,800 staff on diversity courses, set up 24 learning centres to raise skills, and begun a diversity recruitment programme. Now, Arriva North West & Wales has seen an increase of 60% in female bus drivers and Arriva Yorkshire has seen a third reduction in the number of people leaving within two years of employment.
- Recruitment and training provider PPDG finds local knowledge and commitment is invaluable when taking on new employment coaches and other staff. This has resulted in a diverse workforce which understands the needs of different communities and has seen its market share in some areas rise from 50 to 63% while lower staff turnover has saved the firm money too.
Richard Lambert, director-general of the CBI, said: "Employers who take steps to encourage a more diverse workforce notice huge benefits from doing so, whether it is hiring skilled staff, understanding their customers' needs better or more fundamentally through improved morale and productivity.
"It does not have to be hard work or legally complex either - simply making the effort to work out your precise needs, reaching out as widely as you can then hiring, training or promoting the best person on merit."
TUC general secretary Brendan Barber said: “The need to unlock the talents of all – to create a truly representative workforce – is even more crucial at a time of economic uncertainty. The issue is not whether business can afford to diversify, but whether it can afford not to.
“Employers wanting to diversify the workplace will always find unions a willing ally. Diversity policies work best when the entire workplace is involved. Our growing network of equality reps in workplaces across the UK are helping deliver diversity from the boardroom to the shop floor.”
Trevor Phillips, chair of the Equality & Human Rights Commission, said: "Most of us, employers and employees, know that in today's workplace, successful competition with our rivals depends on cooperation with our colleagues. Diversity can be an obstacle to working better - or it can be the spur to greater success.
"This guidance is a real-world, commonsense collection of stories and suggestions that will be useful for companies of all kinds and sizes."
Minister for Equality, Harriet Harman said: "I welcome the work that the TUC and the CBI have done together on this guide. Equality and diversity is not just right in principle, but is necessary for Britain to be a modern and successful economy. This guide will be important and I look forward to seeing it used by businesses and public services alike."
Both small and large companies have found that looking at what people can do rather than pigeon-holing them by one demographic characteristic or another has helped solve skills shortages in tight labour markets. Other case studies include:
- RBS works with staff who become disabled to keep them in their jobs, believing that acquiring a disability doesn’t remove the talent that led the bank to employ them in the first place. And hotel group IHG has found disabled staff are less likely to be off sick than their non-disabled counterparts.
- Computer multinational IBM cites evidence that its approach to lesbian and gay equality helps attract and retain customers. Public service company Serco’s commitment to diversity has helped it win contracts, deliver better services to local communities and capture new custom.
- Hospitality company Botanic Inns has taken the rare step in its sector to provide employees with a wide range of flexible working options, and a 24 hour advice service as well as enhanced maternity and paternity pay resulting in lower staff turnover.
- Smaller firms Beacon Foods, Oakwood Builders and Joinery, and mouse mat manufacturer Listawood believe that age, ethnicity, gender and the need for flexibility to look after children are less important than whether someone can do the job, while pharmaceutical and consumer healthcare giant GSK has worked with trade unions to end age bias in recruitment processes and retain workers with key skills beyond normal retirement age.