Workplace Diversity and Profits
By promoting workplace diversity, could an entire industry or company increase profits?
New workplace diversity initiatives throughout many industries are causing lots of controversy. The Dodd Frank Bill's diversity initiative have caused some in the financial services industry to cry foul. Diana Furchtgott-Roth, a senior fellow at the Hudson Institute told the Los Angeles Times "If the CEOs of American financial institutions have to be worried about the workplace diversity regulations, whereas those in other countries are worrying about their profits, we are going to fall behind". To set the record straight, the new workpalce diversity requirements set forth by the Dodd Frank Bill, does not demand that financial services firms implement hiring quotas. Rather, the law is asking financial services firms to promote diversity hiring. Many other industries have implemented similar requirements. Could these workplace diversity requirements end up being a positive for the financial services business as they have with other industries? Are more industries set to follow?
There are several examples of how businesses and industries who have gone about promoting workplace diversity have ended up benefiting. Over the last few years NASCAR has implemented their "Drive for Diversity" program to promote the hiring of minority and female drivers, crew members and officials. "The program has delivered on what it set out to do, which is to create opportunities for young minority and female aspiring drivers to participate in NASCAR developmental series," says Marcus Jadotte. Jadotte, who is African American, is the former deputy director of John Kerry's 2004 presidential campaign and heads NASCAR's public affairs division, where his duties include supervising the Drive for Diversity program. According to numbers provided by NASCAR, there are nine African American crew members, engineers and transporter drivers working in the three national series. As more women and minorities become successful within NASCAR, imagine how their audience and profits will grow. It is no wonder that NASCAR is in search of the next Danica Patrick. Just look at what Patrick has done for the Indy Car Series. In 2010, Patrick ranked #4 on the Forbes list of the highest earning female athletes. Patrick's success has paved the way for other professional female Indy car racers and certainly helped expand the fan base.
Even the National Football league has recognized the need to promote diversity. In 2002, the NFL adopted the Rooney Rule. Much like section 342, the Office of Minority and Women Inclusion, the Rooney Rule does not require hiring quotas. The rule does however require teams to interview at least one minority candidate for head-coaching and upper management positions in order to promote diversity. Among its 32 teams, the league has six African American head coaches and five African American general managers. As far as racial diversity goes, the league appears to be significantly improved. After all, then Colts coach Tony Dungy and Bears coach Lovie Smith were the first African American coaches to reach the Super Bowl in 2007. Mike Tomlin's Steelers won a Super Bowl and Colts coach Jim Caldwell also reached the Super Bowl. Mike Tomlin of the Pittsburgh Steelers is headed back to the Super Bowl in 2011. Promoting diversity certainly has not been a negative for the NFL.
Some financial services firms are already taking steps to promote diversity. Financial services giant KPMG considers promoting diversity in their workforce as "business critical". KPMG's website reads:
We are a community of professionals from 144 countries – spanning generations and bringing different outlooks and perspectives. This means we have a truly diverse range of business styles, opinions and attitudes to bring to bear on our work with clients – this is a major advantage, because the diversity of KPMG better reflects the world in which our clients work, and the customers they serve.
This inclusiveness gives us a diversity of thought and skills that is central to the KPMG culture and way of working. To promote and explore workplace diversity, you'll find our member firms have networking forums for minority groups, based on gender, sexual orientation, ethnicity and more. And when we recruit, we actively seek out different approaches, skills, experience and opinions.
With KPMG, we promise that opportunities will be equally open to everyone. Regardless of gender, ethnicity, age, disability or sexual orientation, we will help you succeed at KPMG.
Could KPMG's commitment to diversity and women inclusion have anything to do with their business overall success?
Imagine if the asset management or computer industry took proactive steps to promote workplace diversity and ended up finding the "Danica Patrick or Mike Tomlin" of their industry. Asking companies to promote diversity hiring could be the best thing that ever happened to their business?
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