The diversity and inclusion (D&I) landscape in the U.S. is facing a perfect storm of challenges. The multifaceted attack — political, social, and legal — demands a multifaceted response. To navigate this turbulent environment and advance diversity and inclusion, organizations must focus on three key actions: tying D&I to business outcomes, creating systems that focus on debiasing, and building cultures of accountability, as I wrote recently in Fast Company.
The backlash
The U.S. is experiencing a surge in anti-D&I sentiment, fueled by political actions, social pressures, and legal uncertainties. This backlash creates a complex environment for organizations striving to foster diverse and inclusive workplaces. To respond effectively, organizations must understand the three sources of the backlash:
- The political arena: The political climate is increasingly hostile towards D&I, with executive orders and legislative efforts aiming to dismantle D&I programs.
Since last year’s SCOTUS affirmative action decision and the closing of the House Office of Diversity and Inclusion, threats to the public sector have had a chilling effect on the private sector. However, we predicted that plenty of companies would notback down.
These predictions still hold, even as threats to the private sector have become real under the new administration. According to a recent study published by the right-wing Heritage Foundation, 485 of the Fortune 500 companies still actively promote D&I initiatives. That means 97% of Fortune 500 companies have not canceled D&I; moreover, 86% of chief diversity officers expect budgets to remain steady or increase in 2025.
- The social battlefield: Organizations face pressure from stakeholders with conflicting views on D&I. Some demand more aggressive initiatives, while others criticize them as “woke” or divisive. This creates a dilemma for organizations, as fear of alienating customers or facing boycotts can lead organizations to water down or avoid speaking publicly about their D&I efforts — or so it may seem.
However, in a review of prominent companies’ public statements, Kenji Yoshino and David Glasgow of NYU’s Meltzer Center for Diversity, Inclusion, and Belonging found only one statement that was a “categorical withdrawal” from D&I.” The reality, Yoshino said in a recent NeuroLeadership Institute (NLI) webinar, is that “companies are withdrawing in a very limited way.”
And while media sensationalism may provide effective cover for quietly continuing D&I work, organizations need to think about the impact of this strategy on their employees. Our brains crave predictability. When we experience a disconnect between what a company says and what it does, it creates cognitive dissonance, which erodes trust and engagement. In fact, alignment between what an organization says and what it does is the foundation of organizational accountability.
- The legal minefield: Although the law moves more slowly than political and social forces, it’s important for organizations to thoroughly understand the legal framework surrounding D&I.
Title VII of the Civil Rights Act of 1964 prohibits employment discrimination based on race, color, religion, sex, and national origin. Yet because the interpretation and application of laws can change, organizations must stay updated on the latest legal developments to ensure compliance. This involves seeking legal counsel when necessary, regularly auditing D&I policies and practices, and staying informed about any legislative or judicial changes in interpretation.
The organizational response
In the face of these challenges, abandoning D&I efforts is not a strategic option for organizations. Research indicates that when leveraged effectively, diverse teams are more innovative and make better decisions, resulting in enhanced performance and financial outcomes. A 2023 survey revealed that inclusive companies are 1.7 times more likely to be innovative and generate 2.3 times more cash flow per employee. D&I isn’t a problem to solve; instead, it solves problems.
To successfully navigate the current landscape and continue to benefit from D&I, organizations must adopt a strategic and proactive approach, emphasizing three key actions:
- Make the case for impact: Organizations must clearly communicate the “why” behind their D&I commitments in a manner that resonates with a wide range of stakeholders, including those who may be resistant. By effectively articulating the “why,” organizations can make D&I initiatives compelling, engaging people’s intrinsic motivational brain networks. Research indicates that explaining “what’s in it for me” makes individuals more likely to align their personal goals with the initiatives, increasing their active participation. This approach moves beyond the moral justification for D&I by demonstrating its tangible value. Bringing the case alive requires good data combined with strong narratives.
We have developed a science-based framework that highlights the tangible benefits of D&I and offers practical guidance on achieving them. This framework underscores the importance of prioritizing diversity and embedding inclusion to drive business success and to foster a just, sustainable work environment for everyone. It also provides a roadmap for organizations to measure the impact of their D&I initiatives and demonstrate their return on investment. In today’s climate, with D&I facing heightened scrutiny, it’s more crucial than ever for organizations to articulate the business case for D&I and demonstrate its value.
- Embrace the power of debiasing: Debiasing is essential for creating fair and inclusive systems and processes. By eliminating unconscious bias from all types of decision-making, including business and people decisions, organizations can create equitable environments. This approach can even address concerns from those who argue against D&I based on a “meritocracy.”
Individually, this involves understanding and mitigating unconscious bias. Interpersonally, it requires changing behaviors, adopting inclusive habits, and fostering psychological safety in teams. Institutionally, strategies such as blind recruitment, structured interviews, and standardized evaluations can sustain progress. NLI’s Priorities, Habits, and Systems™ framework helps embed these priorities into daily habits and systems.
- Build a culture of accountability: Accountability is crucial for any successful D&I strategy. Having policies is not enough; organizations must put these policies into practice for employees and customers. Organizational accountability not only boosts employee engagement and performance but also predicts long-term organizational success. Inclusive leadership requires accountability to model and ensure inclusive behaviors.
NLI research has identified two forms of accountability that can be applied to D&I work. Many organizations default to a punitive approach, such as withholding bonuses, that focuses on blame and punishment, hindering progress and creating a toxic environment. Conversely, fostering a proactive culture of accountability frames accountability as a challenge and growth opportunity. For D&I work, this means clearly communicating the “why” behind initiatives, setting success metrics, and sharing outcomes with employees and customers.
Looking Ahead
The journey for D&I is filled with twists, turns, and challenges. However, it also is brimming with opportunities. By adopting a strategic and proactive approach, organizations can navigate current difficulties and succeed in an increasingly diverse world.
This is a pivotal moment for D&I. Organizations that rise to the challenge not only will benefit from a diverse and inclusive workforce but also will help create a more just and equitable society. By integrating D&I into their business goals, removing bias from their systems, and fostering cultures of accountability, organizations can weather the storms ahead and emerge stronger and more inclusive than ever before.
A version of this article appeared in Fast Company. To read the full article, click here.
