Diversity, Equity, and Inclusion (DEI) initiatives are vital to fostering fairness, innovation, and high organisational performance. DEI promotes equal opportunity for all individuals, regardless of background, and recognises that diverse teams drive business success.

Critics argue that DEI initiatives favour candidates based on demographic characteristics rather than qualifications, potentially undermining merit. This focus on diversity could result in unqualified hires, as some believe that individuals might be selected to meet diversity targets rather than based solely on skills or performance.

The “Equity” component of DEI, which emphasises fair access to resources and opportunities for individual needs, is often overlooked. Recent trends show that some organizations are scaling back on equity efforts. A study by Seramount reveals that 10% of companies have removed or de-emphasized the equity element in their DEI frameworks, which may not be the best decision.

A merit-based DEI approach integrates excellence and diversity, ensuring organisations select top talent while enhancing inclusivity. This middle ground addresses fairness and upholds a standard for performance, creating a dynamic, equitable workplace that benefits both employees and businesses.

• Diversity means recognising varied backgrounds, experiences, and perspectives, which contribute to innovative thinking and problem-solving, ensuring a well-rounded talent pool.
• Inclusion ensures an environment where every individual regardless of identity, feels empowered and respected, enabling all to contribute effectively, thus maintaining high performance.
• Equity provides fair opportunities, tailored support, and resources, ensuring individuals can meet their full potential based on their qualifications and performance while addressing systemic challenges.
• Merit emphasises selecting individuals based on their qualifications, skills, and performance, ensuring high standards are upheld and top talent is recognised.

Merit-based DEI weaves diverse perspectives, experiences, and talents into the quality threads of a tapestry to build a stronger, more vibrant organization. Combining excellence with diversity, companies enhance innovation and foster a culture of high performance. This approach emphasizes how effectively balancing merit and diversity drives business success.

Overview of DEI With MERIT

1. Employee sentiment: 52% of employees expressed positive sentiment on diversity highlighting the need to embrace diverse talent while ensuring that these individuals meet the high standards of a quality workforce to drive innovation and success.
2. Correlation between Diversity in the Workplace and Profitability: Based on the McKinsey report, Companies in the top quartile for gender diversity in executive teams were 25% more likely to have above-average profitability. This figure has steadily increased from 15% in 2014 to 21% in 2017, and now 25%, but it must be paired with a focus on selecting the best-qualified individuals to ensure sustainable success.
3. Gender equity in the workforce: Emphasising merit-based gender diversity allows talented women to excel in leadership, contributing to better organisational growth and innovation. Companies with over 30% women in executive roles were 48% more likely to outperform those with only 10-30% female representation.
4. Ethnic Diversity and inclusive organisational culture: Ethnic diversity strengthens performance, but to truly excel, it’s crucial to prioritise both diversity and merit in hiring, creating a workforce that thrives on talent and inclusion.

Key Challenges

1. Job Rejections Due to Perceived Exclusion: Nearly 40% of candidates have declined job offers due to a perceived lack of inclusion in the organisation.
2. Lagging Efforts for Inclusion: Over a third of respondents feel their companies don’t do enough to create a diverse and inclusive workplace. Only 6% believe current efforts are excessive.
3. Microaggressions: A staggering 84% of employees have faced microaggressions at work, such as:

• Being overlooked for their ideas.
• Facing assumptions about their personal lives.
• Being asked to represent their entire group.
• Being coached to communicate in ways that feel inauthentic.

4. LGBTQ+ Community: 37% of LGBTQ+ respondents have had uncomfortable experiences coming out highlights the need for organisations to create a supportive, merit-based environment. We offer opportunities based on skills and potential, ensuring that all individuals, regardless of their identity, have a fair chance to contribute and succeed, which fosters an inclusive and high-performing workplace.
5. Lack of DEI in Employee Engagement: Employees who feel included are more committed and excited about their work. However, a lack of inclusion continues to undermine engagement and morale.

Solutions for Advancing

1. Diverse, Inclusive Leadership with Excellence: The presence of diverse leaders, coupled with a focus on merit-based selection, fosters a sense of inclusion by ensuring that leaders are highly qualified. This combination of diversity and excellence enhances employees’ trust in leadership.
2. Meritocracy and Fair Performance Evaluations: Meritocratic cultures, which emphasise fairness and transparency in performance evaluations, strongly correlate with greater inclusion.
3. Offer DEI Training Programs: Unconscious bias training increases awareness of implicit stereotypes and fosters a more inclusive workplace. Giving mandatory training sessions to the qualified workforce has proven effective. For instance:

• Google’s workshops on unconscious bias, attended by over half of its employees.
• Pew Research indicates that 53% of employees find DEI training helpful.

Cases of DEI Initiatives with Merit

Several organisations have effectively integrated Merit-based Diversity, Equity, and Inclusion (DEI) systems into their operations, leading to tangible outcomes. Here are some notable examples:

• Ingka Group (IKEA)
  Implemented action plans, mentorship programs, and inclusive succession plans to achieve gender parity. By 2018, they introduced gender-neutral salaries and the Global Pay Equity initiative, covering 99.6% of their workforce by 2020. Their goal is to maintain a pay gap of less than 1% by 2025.
• Google
  Google has prioritised diversity by launching programs to boost the representation of women and underrepresented minorities in tech, including historically Black colleges and universities (HBCUs) while also ensuring the availability of skills in them.
• PwC UK
  PwC UK initiated a five-year plan to advance social mobility through external programs focused on community development, upskilling, and advocacy, alongside internal programs aimed at inclusive hiring and work environments. These initiatives enable individuals from lower socioeconomic backgrounds to develop the necessary skills and contribute to a more inclusive organisation.

Conclusion

Merit-based DEI forms the quality threads of a tapestry, weaving diverse perspectives, experiences, and talents together to build a stronger, more vibrant organization.

This synergy creates an inclusive environment where diverse perspectives drive innovation, and merit selects the best candidates to achieve high performance and growth. Embracing both principles together creates a more equitable and capable workforce.

The journey may be challenging, but just as a symphony thrives on the harmony of diverse instruments to create beautiful music, organisations that bring together and harness the collective power of highly qualified diverse voices will thrive and grow in today’s dynamic world.

All the best

Richa Mahendra (ICF Accredited PCC Coach, Business Coach, Leadership Coach)

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