More organizations are tying compensation to diversity, equity and inclusion goals — and they’re seeing better financial results. Here’s how to craft the right goals and help push the movement for systemic change.
As the old adage goes, “what gets measured gets done.” Historically, the challenge with diversity, equity and inclusion work (DEI) is that it’s perceived as a “nice-to-have” versus a “must-have” with few concrete goals to measure progress. In fact, McKinsey research found that organizations often overburden those marginalized groups to lead the DEI work without additional compensation.
That trend is changing with more companies tying compensation to DEI work. According to the Society for Human Resource Management, between September 2017-18, 51 companies in the S&P 500 included a diversity metric in their compensation program. Between February 2020-21, that number had nearly doubled to 99 companies.
By rewarding DEI work, these organizations are seeing results. When people know that it’s tied to their compensation and performance goals, people see it as a part of their job rather than a hobby outside of work hours. With goals, employees are more likely to prioritize the time spent on education and activities to drive awareness and systemic change.
Why set DEI goals
Goals are essential for human motivation. The Psychological Bulletin found that 90% of the studies showed that more challenging goals lead to higher performance. Research has shown that people are two to three times more likely to stick to their goals if they make a specific plan for when, where and how they will perform the behavior. The human brain is wired for goals.
Without accountability, goals do not work. It is essential to frame DEI goalsetting as important as any other goal-setting process in business, but there might be initial pushback, as there often is with organizational change. Watch out for these opportunities to advocate for DEI goal setting:
- DEI is not a zero-sum game. By focusing on diversity goals, we grow opportunities for innovation and decision-making in business results.
- The majority group is a part of the solution, not the problem. Decision makers must prioritize DEI for their decisions to support diversity.
- DEI is not political. These are human issues that impact people in the workplace.
The initial pushback can create drama. The more the leadership team emphasizes the importance of diversity and inclusion and how it ties to the organization’s overall strategy, the more people buy in. People often need a starting point for goal setting.
How to set DEI goals
You might be thinking that this sounds hard. Decades of workplace inequity will not be solved overnight. Yet with specific goals, people understand expectations and modify their behaviors to be more inclusive. Setting goals requires specificity, numeric measurement, aspiration, relevance and a deadline.
- Specific: It should be easy to know when the goal has been completed.
- Measurable: There is a number or percentage tied to the goal.
- Aspirational: By definition, goals are not being met today it should be challenging based on the present state.
- Relevant: The individual can influence the outcome of the goal.
- Time-bound: Without a deadline, things don’t get done.
By making DEI goals SMART, employees understand expectations and are held accountable. Without goals or with vague goals, employees are left to wonder why it is important or how to show progress. DEI goal setting often comes with pushback (as with any change).
Here are some starter goals to consider:
- Number of hours on diversity education and training
- Participation in Employee Resource Group (ERG) activities
- Activities to support removing bias from recruiting, hiring, promotion, pay and performance decisions
- Inclusive behavior 360 data from team members
- Leadership roles in DEI and ERG teams
- Participation in community events for DEI
- Teaching time with others about DEI
- Recognition from others of allyship
As with any goal, thinking about how it fits into what people are already doing makes it easier to accomplish. James Clear, author of Atomic Habits summarizes it best: “You do not rise to the level of your goals. You fall to the level of your systems.”
Bottom line — weave DEI into daily tasks and embed it into how people live already personally and professionally. Break the daunting goal into baby steps with incremental activities throughout the year to support it.
Here are some themes to keep in mind to get your organization ready for DEI goals:
- It’s a journey, not a destination: Set reasonable targets and goals to close gaps in talent, pay and education.
- Make it a part of the performance: Establish KPIs for employees to work on DEI, otherwise, it is simply a “nice-to-have” vs. a “must-have.”
- Engage senior leadership in a consistent, intentional set of actions over the year: This should be a part of every employee meeting and key activity.
- Measure progress: Look beyond representation numbers and dig in holistically about attitudes/perceptions.
- Take education to the next level: Go beyond awareness to tangible activities employees can take action on like addressing bias in systems and accountability.
DEI goals should be a part of a bigger DEI picture. Providing tools and systems to help people hold themselves accountable is pivotal. By focusing on DEI goals, organizations increase their chances of long-term success with DEI — and by investing and prioritizing it now, they will remain relevant for future customers and employees.
Want to do better, and not sure where to start? That is why we developed the Lead Like an Ally virtual self-paced training program, perfect for organizations struggling with accountability for diversity. You can also check out all of our other virtual and live program offerings.