Fatihah Ramzi, DigitalCFO Asia | 10 August 2022
The connection between Sustainability and Diversity, Equity, & Inclusion (DE&I).
These days, companies, governments, nations, and futurists frequently utilize the terms sustainability and sustainable development. While everyone is working to meet the UN Sustainable Development Goals by 2030, it has been identified as a megatrend in numerous notable publications. In spite of this, many people have begun to wonder how sustainability and diversity, equity, and inclusion (DE&I) are related both globally and within their own organizations.
To find out how Diversity, Equity & Inclusion (DE&I) are the missing link to all our sustainability efforts, DigitalCFO Asia spoke with Dr. Josh Heniro, Senior Director, IMA Southeast Asia & Australasia.
DE&I In Helping Companies Become Sustainable
A company’s biggest asset is its people. For an organization to be sustainable long-term, leadership must focus on attracting and retaining talent. However, our report, “Diversifying Asia-Pacific Accounting Talent: A Critical Imperative to Achieve Transformational Outcomes,” found that on average, more than one-third of female respondents and about half of the respondents who identify as members of minority ethnic groups, indicated that they left a company due to the lack of equitable treatment. When we assessed the impact of DE&I on talent retention within the profession, as many as 17% of female and 20% of minority ethnic groups respondents reported inequitable and exclusive experiences that were believed to be rooted in bias to be a contributing factor to their decision to leave the accounting and finance profession.
“For a company to become sustainable and be around for the long-term, they need to look into attracting and retaining talent, with a commitment to DE&I initiatives to promote a diversified, equal, and inclusive work culture.”Dr. Josh Heniro, Senior Director, IMA Southeast Asia & Australasia
The Race Towards Sustainability; Remaining As The Top Few Runners With DE&I
DE&I in an organization requires the collaboration and effort of everyone involved. Each has a part to play in ensuring a diversified, equal, and inclusive organization, from employees and management to the HR department. IMA’s report highlighted four primary categories: awareness, attraction, promotion, and accountability.
Firstly, managers need to be aware of identifying and mitigating conscious and unconscious bias so that people of different backgrounds can be seen as talented, capable, and valued contributors. Employees will also need to communicate with their supervisors if they are faced with a situation that undermines their abilities due to conscious and unconscious bias. Open communication should be encouraged, so employees are not afraid to share honest feedback for the organization to grow.
Secondly, a collective effort of employees and the HR department is required to attract and promote the organization as a desirable place to work regardless of gender, ethnicity, or race. This can vary from underrepresented employees being mentors to promoting interactions and identifying shared values with potential hires of diverse backgrounds.
Thirdly, supervisors must ensure that specific steps are taken so that people of diverse backgrounds have equitable access to the factors that enable career progression. For instance, supervisors can assign people to clients, teams, and projects without favoritism, bias, or presumptions about interests and capabilities. Additionally, employees, regardless of their background, need to be provided exposure to how things work at the higher levels to prepare and groom them for senior management roles. One point our survey respondents and interviewees highlighted was that diverse talents often “stay quiet” and do not report instances of microaggressions for fear of retaliation or lack of anonymity. Hence, it is also essential for HR departments and supervisors to offer a follow-up process to correct microaggressions and take action against it once it is identified.
Lastly, it is also vital for supervisors to measure the performance and progress of all employees regarding the first three components – awareness, attraction, and promotion. Internal processes are required to heighten awareness and eliminate microaggressions tied with constant measurement and progress reporting not only on diversity, but also on equity and inclusion. Leaders in practice are also needed to be held accountable with links to compensation and performance to ensure that performance and progress are tracked and compensated fairly.
“All parties, from the employees to the HR department and leaders, must make a collective effort to ensure that an organization supports DE&I initiatives to remain competitive,” says Dr. Josh Heniro, Senior Director, IMA Southeast Asia & Australasia.
The First Step To Becoming A More Sustainable Business
As many know, sustainability has a vast potential for organizations. A McKinsey study found that a $9.2 trillion investment is required annually until 2050, where $6.2 trillion would go to low-emissions assets and enabling infrastructure annually. However, investing in the environment is just one of the steps in becoming a more sustainable business.
On a smaller scale, companies can ensure fair DE&I practices within the organization for its first step, fulfilling the “S” of “ESG”. As mentioned previously, employees are the company’s biggest asset. Talent is required to help carry the profession’s transformational efforts forward to ensure the business’ and the profession’s longevity. Having a diversified, equal, and inclusive culture enables the constant flow of new ideas and perspectives due to the different backgrounds of the employees, lifting the company to scale greater heights for long-term growth.
Getting Employees On Board And Hands-On Towards A More Sustainable Future
As mentioned above, companies need to build a solid foundation in DE&I practices and ensure that employees of diverse backgrounds are being taken care of in terms of awareness, attraction, promotion, and accountability. Once a stable base is built, the company will eventually see the birth of new ideas and perspectives, which would be essential for long-term growth and a sustainable future.