Top 9 ESG ( Diversity) Initiatives in Companies

The recent protests and unrest towards racial equality have accelerated the attention towards diversity and inclusivity in companies. Companies are facing pressure from different stakeholders – customers, employees, investors & regulators – to make changes in the way they operate and adopt new initiatives, to run a diverse and inclusive organization. For many businesses, diversity has become a part of the company’s culture and values.

Intellizence AI Platform monitors Environmental, Social & Governance ( ESG) initiatives news in companies across sectors. We have identified the top 9 trends focused on Diversity & Inclusivity initiatives.

1. Appointment of Diversity Board of Directors

There is increasing pressure on organizations to add board members from diverse groups, and we see steady strides being made in that direction. Nasdaq has made a proposal to the U.S. Securities and Exchange Commission to adopt new listing rules related to diversity and disclosure. This may be the biggest push for businesses to ensure the appointment of diverse directors.

Some of the Board of Director appointments in major companies are:

• Blue Shield of California has elected Kristina Leslie as the first woman to chair its Board of Directors.
• Netflix Inc. appointed Zimbabwean billionaire Strive Masiyiwa to its board, adding its first African director.
• Discovery has named Black Entertainment Television co-founder Robert Johnson to the Board Of Directors.

2. Appointment of Chief Diversity Officer (CDO) / Head of Diversity & Inclusion Initiatives

Chief Diversity/Equity/ Inclusion Officer ( CDO ) is the emerging CXO title in the corporate world. CDO’s are the chief diversity and inclusion strategist that work across the organization to optimize the organization’s diversity and inclusion goals with the desired business outcomes. They are reporting to the CEO and/or some are part of the Executive Board, which indicates the significance of this role.

Few recent appointments by leading companies are:

• Felicia Mayo is the chief talent, diversity, and culture officer at Nike.
• The Prada Group has appointed Malika Savell as Chief Diversity, Equity, and Inclusion Officer for Prada North America.
• Sandra Sims-Williams is appointed Chief Diversity Officer for Nielsen.
• MTM, a woman-owned and operated organization, has appointed Etta Jackson as Chief Diversity Officer.
• Visa has appointed Michelle Gethers-Clark as Chief Diversity Officer.

3. Launching of Diversity and Inclusivity Funds

Companies are launching diversity and inclusivity funds to invest in businesses owned by diverse groups and communities. Some of the mega diversity fund launches & pledges are:

• Goldman Sachs has committed $1 billion to invest in diverse businesses and funds through its Launch With GS initiative. The company aims to use the fund to facilitate connections for women, Black, Latinx, and other diverse entrepreneurs and investors.
• PayPal has pledged $530 million to support black and minority-owned US businesses, of which $500 million is for an opportunity fund and $15 million for fostering diversity at PayPal.
• Netflix is launching Netflix Fund for Creative Equity, which will invest $100 million over the next five years in organizations that help underrepresented communities train and find jobs in TV and film.
• MassMutual has launched a $50 million MM Catalyst Fund to increase job creation and business growth among diverse businessmen in the Commonwealth of Massachusetts.

4. Renaming of Brands

Many brands are in the spotlight for having, images, mascots, and logos that represent a specific race or group, or community. This has resulted in companies taking the initiative to rename their age-old brands. Some of the major brands that have been renamed are:

• Aunt Jemima brand removed the image from the packaging and changed the brand name. The new name is Pearl Milling Company.
• Mutual of Omaha is removing the Native American image from its corporate logo. They will address issues of racial equity and social justice, including additional funding for initiatives and charities addressing these issues.
• Unilever is renaming its Fair & Lovely skin-lightening cream and will remove all references to the words “fair/fairness,” “white/whitening,” “light/lightning” from its products’ packaging and communications.

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5. Benchmarking with Equality Indexes

Companies are benchmarking themselves, measuring policies, practices, and benefits pertinent to diversity and inclusivity. Some of the popular indexes that they have started using for their benchmarking are:

• The Disability Equality Index (DEI) – This is a comprehensive benchmarking tool that helps companies in evaluating disability inclusion as part of their organization’s diversity and inclusion or sustainability efforts.
• Corporate Equality Index – The Human Rights Campaign Foundation’s Corporate Equality Index is a national benchmarking tool that measures policies, practices, and benefits pertinent to lesbian, gay, bisexual, transgender, and queer (LGBTQ) employees. It is a primary driving force for LGBTQ workplace inclusion.
• Refinitiv Diversity & Inclusion Index – Diversity and Inclusion Index is designed to measure the relative performance of companies against factors that define diverse and inclusive workplaces.
• Bloomberg Gender-Equality Index (GEI) – The Bloomberg Gender-Equality Index (GEI) tracks the performance of public companies committed to disclosing their efforts to support gender equality through policy development, representation, and transparency.
• ParityINDEX: Parity.org’s ParityINDEX gives companies a private dashboard with insights into areas like pay equity and the employment cycle by gender and race.

6. Building a Diverse Talent Pipeline

Companies seeking a diverse talent pipeline are hiring more students from historically Black colleges and universities this year.

• Microsoft has invested $150 million in diversity and inclusion programs and will double its number of Black and African American managers and senior employees by 2025 in the U.S.
• IBM has launched its first IBM Quantum education and research initiative for Historically Black Colleges and Universities (HBCU), aimed at driving a diverse and inclusive quantum workforce. IBM will be making a $100 million investment in technology, assets, resources, and skills development through partnerships with additional HBCUs through the IBM Skills Academy Academic Initiative.
• Apple expands coding partnerships with Black schools as tech firms grapple with the lack of diversity.
• Discover, the leading financial services company plans to open a new customer care center based in Chatham, a predominantly Black neighborhood on Chicago’s South Side, and provide almost 1,000 full-time job opportunities for local talent over the next four years.

7. Diversity Sourcing

Companies are not only taking initiatives to increase diversity among employees but also accelerating initiatives to increase diversity among their suppliers. They appoint diversity sourcing managers and make sourcing policy changes to source products & services from businesses owned by diverse and minority people or groups. Companies are partnering with Diversity Supplier Certification agencies to identify the diverse suppliers. Few such diversity certifying organizations are:

• National Minority Supplier Development Council
• Women’s Business Enterprise National Council
• National Gay and Lesbian Chamber of Commerce
• Disability: IN
• National Association of Women Business Owners (NAWBO)
• National Association of Minority Contractors (NAMC)
• Small Business Administration
• Department of Veterans Affairs
• Federal, State, and/or Local Government Certifying Agencies

8. Diversity Sponsorships & Scholarships

Many companies have announced new categories of sponsorships, grants, and scholarships to boost diversity in academic institutes. The scholarships and grants are given to:

• Support students from marginalized communities with financial aid.
• Recruit students in courses like journalism, medicine, and mental health.
• Promote diversity among faculty.

Companies are giving donations to not-for-profit organizations that advocate diversity and inclusivity-related initiatives.

9. Products & Solutions to Measure & Improve Diversity

Companies are launching new product features & solutions that would help their customers to measure or improve diversity, equity, inclusiveness in their organizations. Few such launches by leading companies are:

• Qualtrics released a new solution to help organizations uncover critical insights about diversity, equity, inclusion, and belonging within their organizations, and empower them to take actions that drive powerful, measurable, and systemic change.
• Producer and director Ava DuVernay and her nonprofit Array launched a new database called Array Crew to diversify film and TV production crews to include more women and people of color.
• Glassdoor launched new product features that offer a new level of transparency into the state of diversity, equity, and inclusion (DEI) at companies.