CIPD - Diversity: an overview

Diversity and equality

Originally issued June 2006; latest revision October 2007

This factsheet gives introductory guidance. It:

defines diversity and how it has developed
discusses the difference between equal opportunities and diversity
outlines the business case for diversity
suggests ways in which to manage diversity, with tips for action
includes the CIPD viewpoint.

This factsheet summarises the key issues on diversity, an area where CIPD has played a central role in setting the agenda and developing debate. It is based on our guide Managing diversity: people make the difference at work – but everyone is different¹. It does not cover legal aspects in any depth as these are covered by separate factsheets - see the links within the text below.

What is diversity?

People are not alike. Everyone is different. Diversity therefore consists of visible and non-visible factors, which include personal characteristics such as background, culture, personality and work-style in addition to the characteristics that are protected under discrimination legislation in terms of race, disability, gender, religion and belief, sexual orientation and age. Harnessing these differences will create a productive environment in which everybody feels valued, their talents are fully utilised and organisational goals are met.

CIPD defines diversity as valuing everyone as an individual – valuing people as employees, customers and clients.

But there is no single way of treating employees, as each one will have their own personal needs, values and beliefs. It follows that the notion of best practice, while helpful in a theoretical setting, will not provide all the answers in reality. There are multi-variables and many shades of grey – a fuzzy and complex world that relies on approximate reasoning.

How the concept has developed

Changes in the social and economic landscape led to legislation covering equal pay, sex and racial discrimination in the 1970s, followed by disability laws in the 1990s. More recently, discrimination on grounds of sexual orientation and religion has been added to the list covered by the law, at least partly driven by European legislation. All these initiatives were grounded in developing a level playing field for disadvantaged groups; in other words, ending or reducing discrimination and improving social justice. They can therefore be described as being about equal opportunities rather than diversity, and by the 1990s it was being recognised that they had had limited success in achieving their goals.

In the early 1990s, American writers argued for a shift from equal opportunities to diversity because the equal opportunities approach was insufficiently holistic in its attempts to eradicate discrimination (some disadvantaged groups were not represented, or were not adequately represented), and because those who were represented were regarded as homogeneous groups (although, for example, each disabled employee requires individual consideration). At around the same time, researchers were also finding that culturally diverse teams were more creative than homogenous teams and contributed more effectively to meeting organisational goals. Thus there was a business case for diversity, although coping with it would be much harder than simply managing equal opportunities to meet legal requirements.

Three separate commissions have promoted equality and monitored their particular aspects of the legislation: the Equal Opportunities Commission, the Commission for Racial Equality, and the Disability Rights Commission. From October 2007, a new Equality and Human Rights Commission has been established to cover all equality issues as well as issues of human rights.

Some statistics

Unemployment is twice as high among people from ethnic minorities, although there are relatively more Chinese, Indian and Black African graduates than white graduates. Only 12 per cent of white men are in professional occupations, as opposed to 21 per cent of Chinese and Indian men.
White men have the lowest rate of participation in full-time education between the ages of 16-24 (37 per cent), followed by white women (40 per cent).
41 per cent of white women in employment work part-time, but only 7 per cent of white men do so, as opposed to 38 per cent of Bangladeshi men.
Black and Asian people are 2.5 times less likely to have jobs than whites.
Ethnic minorities account for 8.1 per cent of the overall population. Because they are relatively younger, it is projected that ethnic minorities will account for half the growth in the working population to 2009.
In the past ten years, the employment of the over-50s has risen by almost 25 per cent. The number of people aged over 60 is forecast to rise by 40 per cent in the next 30 years.

The social justice or equality case

The social justice argument is based on the belief that everyone should have a right to equal access to employment and when employed should have equal pay and equal access to training and development, as well as being free of any direct or indirect discrimination and harassment or bullying. This can be described as the right to be treated fairly, and the law sets minimum standards.

For more information on these topics, see our various factsheets on: Age and employment; Disability and employment; Harassment and bullying at work; Race, religion and employment; and Sex discrimination, sexual orientation, gender reassignment and employment.

CIPD members can also see more detailed information on the law in these areas in our sets of FAQs.

Go to our employment law FAQs

The business case

Why should any employer want to push the boundaries set by the law? Equal opportunities is often seen as meaning treating everyone in exactly the same way. But to provide real equality of opportunity, people often need to be treated differently in ways that are fair and tailored to their needs. Arguably, the social justice and business case arguments for diversity are complementary, because unless people are treated fairly at work they will feel less than fully committed and will therefore under-perform. But diversity takes equality forward, and evidence indicates that organisations that are serious about diversity show better overall financial performance.

There are three broad strands supporting the case for going beyond what is required by legislation and introducing diversity policies: people issues, market competitiveness, and corporate reputation. Organisations which follow them are also more likely to find it easier to comply with increasingly complex legal obligations, not least because diversity will be embedded in their cultures.

People issues

Research (notably our research on the psychological contract²) shows that people aspire to work for employers with good employment practices, and to feel valued at work. To be competitive, organisations need to derive the best contributions from everyone. Skill shortages and difficulties in filling vacancies are forcing more organisations to recruit from more diverse pools and to offer different employment packages and working arrangements. Creating an open and inclusive workplace culture in which everyone feels valued helps to recruit and retain good people.

Employers who offer good working conditions benefit from more positive and committed employees, who are less likely to leave.
Employees who are happier at work are less likely to suffer from stress or become sick, leading to fewer disruptions in production or service.
Good employers will receive more applications for jobs, leading to a larger pool of talent to choose from.
A diverse workforce will be more creative and innovative.

Diversity policies also help organisations to:

Quality assure policies and working practices because diversity fits well with business excellence models and initiatives such as Investors in People and total quality management.
Create an environment in which people from all backgrounds can work together harmoniously by combating prejudice, stereotyping, harassment and undignified and disrespectful behaviour.
Bring about cultural change.

Market competitiveness

A diverse workforce can help to inform the development of new or enhanced products or services, open up new market opportunities, improve market share and broaden an organisation’s customer base. Examples include:

Financial institutions addressing the needs of ethnic-minority businesses.
Local authorities seeking to improve the way they provide services to diverse groups within their communities.
The Foreign Office recruiting from a wider pool so that embassy staff give a more accurate and balanced image of Britain.
Supermarkets offering products to satisfy a wider range of eating preferences.
Health services seeking to provide more choice for patients recognising their backgrounds and requirements.

Corporate reputation

Healthy businesses flourish in healthy societies and the needs of people, communities and businesses are interrelated. Social exclusion and low economic activity rates limit business markets and their growth. Thus businesses need to consider corporate social responsibility (CSR) in the context of diversity. CSR is usually thought of as being linked to environmental issues, but an increasing number of employers take a wider view, seeing the overall image of an organisation as important in attracting and retaining both customers and employees. Indeed, it can be argued that CSR is part of the psychological contract between a firm and the community or communities in which it operates. CSR measures may include:

Employing people who are representative of the local community.
Seconding employees to charities.
Supporting other initiatives designed to stimulate economies and employment, locally, nationally, or (in the case of multi-nationals) even globally.

For more information see our factsheet on Corporate social responsibility.

Go to our Corporate social responsibility factsheet

Ethical behaviour is important too. Setting standards by means of value statements (and ensuring that they are adhered to) sends messages to present and potential customers, suppliers and employees.

Leading-edge ‘dignity at work’ policies require that all forms of intimidating behaviour, including harassment and bullying, are regarded as contravening the values of an organisation and are treated as serious disciplinary matters.

Managing diversity

Managing diversity is about ensuring that all employees have the opportunity to maximise their potential and enhance their self-development and their contribution to the organisation. It recognises that people from different backgrounds can bring fresh ideas and perceptions, which can make the way work is done more efficient and make products and services better. Managing diversity successfully will help organisations to nurture creativity and innovation and thereby to tap hidden capacity for growth and improved competitiveness.

But how to go about it? It is a complex task and every organisation will have to do it differently. The lead needs to come from the top. Unless the chief executive and board members are committed, change will not occur. It requires systematic management action, with a focus on the development of an open workplace culture in which everyone feels valued and can add value. It is a continuing process, and is at least partly about managing conflict, complexity and ambiguity. Ultimately organisations should aim to make managing diversity a mainstream issue, owned by everyone so that it influences all employment policies and working practices.

Excellence in communications is central. People must be willing and able to talk to each other and listen to each other, and respect different views and ideas.

Figure 1 suggests how organisations can move from where most are at present to a situation in which diversity enters the mainstream.

Figure 1: Managing diversity – how to move equity forward

Managing diversity – how to move equity forward

Tips for action

Although there is no single ‘right way’ to go about managing diversity, the following tips may help organisations considering diversity policies.

Overall strategy

Ensure that initiatives and policies have the support of the board and senior management.
Remember that managing diversity is a continuous process of improvement, not a one-off initiative.
Develop a diversity strategy to support the achievement of business goals, including ways of addressing the diverse needs of customers.
Focus on fairness and inclusion, ensuring that merit, competence and potential are the basis for all decisions about recruitment and development.
Keep up to date with the law and review policies through checks, audits and consultation.
Address work-life balance challenges in ways that take account of employee and organisational needs and offer suitable choices and options.
Encourage ownership and discourage risk aversion, aiming to create an empowering culture so that decisions are not passed upwards without good reason.
Design guidelines for line managers to help them respond appropriately to diversity needs, as they are vital change agents, but give them scope for flexible decision-making.
Link diversity management to other initiatives such as Investors in People and total quality management.
Be aware that if your organisation operates internationally, its approach to managing diversity will need to take account of the ways that individual working styles and personal preferences are influenced by national cultures.

Workplace behaviour

Introduce a value system based on respect and dignity for all.
Aim to describe the desirable behaviours to gain positive commitment.
Make clear that everyone has a personal responsibility to uphold the standards.
Introduce mechanisms to deal with all forms of harassment, bullying and intimidating behaviour, making clear that such behaviour will not be tolerated and setting out the consequences of breaking the organisation’s behaviour code.

Communication

Develop an open culture with good communication channels based on open dialogue and active listening.
Use different and accessible methods such as newsletters, in-house magazines, noticeboards and intranets to keep people up to date with diversity policies and practices.
Consult people for ideas.

Training

Build diversity concepts and practices into management and other training and teambuilding programmes to increase awareness of the need to handle different views, perceptions and ideas in positive ways.
Consider awareness-raising programmes about diversity and skills training to help people work together better in a diverse environment.
Include diversity issues in induction programmes so that all new employees know about the organisation’s values and policies.
Train line managers about diversity, aiming to help them understand the issues and drive them into organisational and operational policies and practices.

Measure, review and reinforce

Regularly audit, review and evaluate progress and keep qualitative data to chart progress and show business benefits.
Use employee surveys to evaluate initiatives, to find out if policies are working for everyone, and to provide a platform for improvement.
Track actions to see if they have had the intended results and make appropriate changes if necessary.
Include diversity objectives in job descriptions and appraisals, and recognise and reward achievement.
Benchmark good practice against other organisations and adopt and adapt relevant ideas where appropriate.
Network with others from inside and outside your organisation to keep up to date and to share learning.
Celebrate successes and identify learning opportunities from failures, to use them as building blocks for further progress.

How diversity links up

For an organisation to gain the full benefits of diversity, a coherent diversity strategy is needed to ensure that all policies and working practices across the business reflect relevant diversity implications which will add value to business performance. Diversity strategies need to embrace greater flexibility in both people propositions and customer and client service delivery and take account of the inclusive nature of the work-life balance agenda.

Managing diversity also links to ensuring that employee wellbeing is not just a ‘nice to do’ but an essential element of employee engagement and motivation. Additionally, smart employers take account of these issues as key components of their ‘employer brand’ to support the attraction support and retention of talent.

CIPD viewpoint

CIPD believes that recognising and valuing diversity is central to good people management practices. HR practitioners have an important role to play in creating inclusive workplaces where everyone can contribute to the success of the organisation. There is a compelling business case which should encourage organisations to look beyond legal compliance with anti-discrimination laws to a value-added approach enabling competitive benefits to be gained from developing good practice. Employers who sit on the sidelines regarding diversity will quickly become less attractive to existing and prospective employees.

Diversity strategies need to be designed to support business objectives and strategies to add real value to business performance. Just ‘doing’ diversity for cosmetic reasons is misguided and can result in undesirable outcomes such as raising expectations through false promises.

Useful contacts

Acas
Helpline: + 44 (0) 845 747 4747
Equality and Human Rights Commission

Department for Business, Enterprise and Regulatory Reform – discrimination in employment pages

Equality and Diversity Forum

References

WORMAN, D., BLAND, A. and CHASE, P. (2005) Managing diversity: people make the difference at work – but everyone is different. Guide. London: Chartered Institute of Personnel and Development. Available at: http://www.cipd.co.uk/guides
CIPD has carried out annual surveys and various research on the psychological contract. For more information and a list of reports, see http://www.cipd.co.uk/research/_psychcntr.htm

Diversity: an overview