As both a business and legal imperative, employers are adopting diversity goals and programs to increase the diversity of their workforces. While essential, there are measures HR leaders should consider before implementing any initiatives so to avoid significant legal risks. Plaintiffs frequently contend that an employer's failure to meet its own diversity metrics demonstrates that the employer's senior management knew of the discriminatory condition and failed to take the necessary corrective action.
In 2000, with the Coca-Cola settlement of $192 million, a stream of multimillion-dollar class-action discrimination actions has demonstrated how the absence of diversity throughout a company may be a significant legal risk. Not to be overlooked, federal legislators have increased their focus on the issue of diversity and inclusion as well. It is essential for employers to stay abreast of what constitutes permissible diversity measures and to use best practices without inadvertently fueling future litigation. Diversity has become a business best practice among the most successful corporations as well as a critical factor in the recruitment and retention of a talented workforce. Companies are constantly rated on the basis of their commitment to diversity -- and their actual and perceived commitment to diversity can enhance their public image.
The reverse is true as well: A perceived lack of this commitment can severely tarnish an organization's image. Truly embracing the diversity of a workforce can also dramatically impact the bottom line. For example, in the early 1980s, women at Reebok voiced their frustration that they could not find a good aerobics shoe. Reebok listened and executed a marketing campaign for women's aerobic shoes. As a direct result of listening to its female employees, Reebok went from a $12 million-a-year shoe company to a $3 billion powerhouse. Since then, diversity has been a critical corporate priority for Reebok.
So should managers be evaluated and rewarded in significant part on the basis of their commitment to diversity? If the organization has performance related rewards then yes. I am sure with most organizations, even if there is no performance related rewards, there are other non financial rewards, including a thank you letter from the Chief Executive, Chairman, etc. that could be given to a manager who has met diversity targets. For me, the real question is, what does meeting diversity targets really mean? Is it about the numbers game or qualitative change and better outcomes for workers, service users and society as a whole? Meeting diversity targets should be both quantitative and qualitative measurable outcomes.
There are studies that show that diversity improves profits. Businesses are in business to make money, so anything that improves the bottom line is generally rewarded. So, as diversity grows profits, it should be rewarded. The idea of rewarding Managers financially for improving 'visible' diversity feeds into the short-sighted definition of what diversity is. The condition of having or including people from different ethnicities and social backgrounds. This taken with the short term view that bringing in people from various racial or gender-specific backgrounds in order to specifically meet targets as an initial priority - indirectly fans the flames of tokenism by feeding into the pre-existing stereotypes.
I do think that maintaining and managing a diverse group could be part of any manager's pay for performance cycle; I thi