This is a crucial first step in building a diverse, inclusive workforce
Over the past year, the global health crisis and increasing racial injustices and economic/societal disparities have highlighted the importance of further prioritizing diversity, equity, and inclusion. Building an equitable and inclusive workplace is fundamental to an organization’s culture and to its ability to both attract and retain talent, and has significant, positive benefits for a company’s reputation.
We believe that diversity and inclusion are not just focused on what is right but also what is good for business. Companies that focus on creating a strong culture of diversity and inclusion reap several benefits, including greater innovation, stronger employee engagement and productivity, and a positive impact on their bottom line.
While we see more and more companies publicly acknowledging the work that needs to be done and committing to taking action, many are asking: how?
You often hear the saying “You can’t manage what you can’t measure,” and it’s true. Companies that measure representation and pay equity understand where they are and can determine what initiatives move the needle. Additionally, consistent measurement allows companies across sectors to show progress in advancing diverse representation at all levels.
Catalyst and Bank of America, along with a number of corporations, academics, and trade organizations, recently partnered together to form the Gender and Diversity KPI Alliance (GDKA) to help companies understand the importance of measuring diversity and inclusion efforts, and to provide a framework for those measurements. Specifically, GDKA promotes the use of three key performance indicators (KPIs) focused on measuring gender and diversity in the workplace:
- Percentage of representation on an organization’s board;
- Percentage of representation by employee category;
- Pay equality: the ratio of compensation by employee category (i.e., equal pay for equal work).
These KPIs were developed out of important work on the Stakeholder Capitalism Metrics developed by the World Economic Forum (WEF) International Business Council with the leadership of Deloitte, EY, KPMG, and PwC. The Stakeholder Capitalism Metrics are part of the WEF’s ongoing work to highlight how businesses create long-term value by aligning their activities and operations to drive progress on important societal priorities, as defined by the United Nations Sustainable Development Goals. About 80 global companies are committed to reporting on the Stakeholder Capitalism Metrics, including Bank of America in its 2020 Annual Report. The GDKA KPIs, along with a strong focus on human capital, provide greater clarity and transparency around measuring diversity and inclusion. They also provide a common language for discussing diversity efforts, and a mechanism for benchmarking progress over time.
Bank of America has long been a proponent of these efforts, not only as part of the Catalyst community and member of Catalyst’s boards, but also through the publishing of its annual Human Capital Management Report. Through that report, the company provides greater clarity and transparency into its diversity and its inclusion metrics, along with insight into how it makes the bank a great place to work—one that already mirrors its clients and communities.
Over 50% of Bank of America’s global workforce are women; and its U.S. workforce is 48% people of color—14% Black, 19% Hispanic-Latino, and 13% of Asian descent. The company also offers employee networks that focus on matters related to each of these groups, with over 90,000 member employees. The company has made significant improvement in recent years on several diversity metrics. Bank of America details that progress in this year’s human capital report.
Commitment to diversity and inclusion is a must, but the use of key metrics in a transparent way will help to bolster progress. By committing to measuring diversity by using these KPIs, companies can continue to drive progress and serve as a catalyst for change across sectors the world over.
Sheri Bronstein is chief human resources officer at Bank of America. Lorraine Hariton is president and CEO of Catalyst.
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