DEI’s woes should mean better, not fewer, initiatives

Diversity, equity and inclusion (DEI) initiatives are once more in the spotlight following the inauguration of President Donald J Trump in the United States.

In an Executive Order, President Trump instructed his Director of the Office of Management and Budget to work towards the termination of all "illegal" DEI policies, programme and activities in the US Federal Government.

“Federal employment practices, including Federal employee performance reviews, shall reward individual initiative, skills, performance, and hard work and shall not under any circumstances consider DEI or DEIA factors, goals, policies, mandates, or requirements,” the Executive Order read in part.

The focus on rewarding skills and performance is not controversial. Most supporters of DEI policies and practices would consider these qualities to be a non-negotiable part of any successful DEI programme.

However, if we aim to create workplaces where individuals from all kinds of backgrounds can have equal opportunities to succeed based on their unique individual strengths and competencies, we need diversity, equity and inclusion initiatives to get us there. Maternity leave, accommodation for disability, and protection from bullying and harassment in the workplace are all examples of DEI policies that enjoy widespread support.

1. The business case: Research has shown that incorporating diverse perspectives can positively impact team-decision making. Additionally, diversity and inclusion can enhance engagement, innovation and problem-solving, while broadening access to talent pools and markets. Yet, despite the evidence, these business benefits often fail to inspire leaders to act on DEI. Leaders and organisations must identify their internal motivations, such as aligning DEI goals with personal and company core values.
2. Purpose-led organisations: Organisations are evolving, with many seeking to fulfil a broader purpose. While maximising shareholder value remains central, more organizations now consider a wider range of stakeholders, including society as a whole.
3. Modern leadership: Leadership expectations have changed significantly. While leaders were once advised to keep emotions out of work, emotional intelligence has become a cornerstone of leadership development. Remote work is now the norm for many, and mental wellbeing is a central focus for companies seeking to enhance productivity and retention. Purpose-driven leadership is increasingly important as younger generations step into leadership roles, demanding more inclusive and ethical business practices.
4. Research on understanding our decision-making: Psychology, behavioural economics, and neuroscience provide new insights into decision-making and unconscious biases. We now know that environmental conditioning often leads to biased decisions. This knowledge gives us the opportunity to act on these biases and make more conscious and fair decisions. Although translating this knowledge into actionable training and initiatives remains challenging, DEI policies and inclusive habits can help to mitigate bias.
5. Altruism supports happiness and wellbeing: Addressing social inequities often requires altruism. Neuroscience is beginning to uncover how altruism and happiness are connected and can positively influence well-being. Organisations are now recognising happiness and well-being as crucial factors for workplace success.

Why do people say 'No' to DEI?

1. Lack of understanding: Many societal issues stem from ignorance of historical and systemic inequalities. Understanding systemic barriers requires deep study and empathy, which can be challenging for those not directly affected. This disconnect makes it difficult to relate to the oppression experienced by marginalised groups.
2. Interpretations of freedom of speech and religious freedom: Tensions can emerge when DEI efforts conflict with individuals’ moral and religious beliefs. For instance, some employers implementing DEI policies related to LGBTQIA+ rights have faced lawsuits and pushback from employees or customers citing conflicting religious beliefs. This tension also intersects with freedom of speech in countries with strict hate speech laws, such as Germany and France. Some employees argue that DEI training infringes on their freedom of belief and expression, contributing to ongoing legal and ethical debates. Successful DEI efforts must be adapted to reflect the specific communities in which they operate. For example, different countries and organisations may have different focus areas: in the US, it may be race; in the UK, mental well-being and neurodiversity; in Japan, aging and the generational divide.
3. DEI and capitalism don’t ‘fit’ together: Critics sometimes view DEI as prioritising social justice causes over traditional business interests. For example, the term “woke capitalism” criticises companies for seemingly prioritising social causes over shareholder value. DEI initiatives perceived as excessive or politically charged have led to boycotts, shareholder disputes and public relations challenges.
4. Perception of putting diversity ahead of merit-based DEI: Critics argue that diversity efforts compromise merit by prioritising identity over qualifications, especially in hiring and promotions. One particularly contentious area is setting diversity targets. While targets can focus efforts and create accountability, they must be accompanied by robust unconscious bias training and inclusive, psychologically safe environments. Without this foundation, some organisations and leaders may cynically meet diversity targets without addressing systemic barriers or supporting diverse hires adequately. DEI is not about hiring or promoting incompetent people; it is about creating equal opportunities and inclusive cultures.

The solution to many of these arguments against DEI need not be the elimination of these programmes, but the development of better DEI initiatives.

Building an inclusive organisational culture is a complex task that must be approached as a change management programme; it requires a strategic, systematic approach to shift mindsets, behaviours and organisational norms. Clear goals, accountability, resources and timelines are essential.

Organisations must:

• Treat DEI as a cultural change initiative requiring long-term commitment and strategic planning;
• Ensure unwavering commitment from top leadership, leveraging ambassadors to drive change authentically;
• Establish long-term goals to promote genuine cultural evolution, avoiding short-term fixes like superficial diversity hires. Merit should not be compromised;
• Implement robust metrics to measure and reward inclusive behaviours and predict future diversity outcomes, such as representation in succession planning;
• Develop tailored DEI programmes, including effective unconscious bias training and context-specific initiatives, while using continuous feedback mechanisms, like pulse surveys, focus group discussions and 360 feedback, to track progress.

Investing in these areas will allow organisations to leverage the power of diversity of thought, individuals’ unique competencies and strengths, and create environments where everyone has a chance to develop and thrive.

Dr Zsuzsanna Tungli is Academic Director of 'Building Diverse and Inclusive Teams: DEI strategies for leaders' at London Business School. She is an expert and passionate advocate of global and inclusive leadership, gender equality and cultural intelligence. She is currently the Managing Partner of Developing Global Leaders, a boutique inclusive leadership development company based in Singapore.

This article was first published in Forbes magazine on 24th January 2025.