Budget season is always stressful for DEI leaders, especially with the threat of a recession and looming budget cuts on the horizon. To help get through it successfully, Seramount recently hosted a webinar to provide resources and tips for setting a DEI budget strategy. Nichelle Wash, Associate Director, led the webinar and was joined by Seramount President Subha Barry for a Q&A discussion. Subha’s professional experience working at Merrill Lynch as a wealth advisor has greatly influenced her work in the multicultural business world and has positioned her to be an excellent resource for the budget conversation.
During the webinar, Subha expressed that having a DEI budget in place is “one of the smartest things a company can do.” In fact, the results of Seramount’s 2022 Inclusion Index showed that 68% of companies increased their DEI budget following recent societal impacts such as George Floyd’s murder and the #MeToo movement, and it gives them a competitive advantage over their peers, especially with many young people entering the workforce who feel that DEI is one of the most important factors when choosing a company to work for. “DEI is no longer a moral imperative. It is a business imperative in today’s climate,” says Nichelle Wash. “Companies that want to stay ahead of the curve are redoubling their investment in DEI budgets.”
Here are a few key takeaways from the resource webinar:
It is important to recognize the members of your organization who prioritize DEI and make sure that it is included in the budget. Those people are often CDOs or HR executives who encounter employees the most. CDOs oversee many initiatives in their role but report being overstretched and under–resourced and often feel mounting pressure when it comes to addressing societal crises.
When organizations invest in DEI, leaders are given the resources and time to come up with strategic, employee-focused plans that can be integrated throughout the organization. This includes strategies on how and what to communicate when crises occur, hiring and retaining diverse talent, supporting ERGs, and more. These programs and strategies make a huge difference in retaining diverse employees who may have one foot out the door.
When talking about building a DEI budget, Nichelle stated: “There is no universal structure for determining a budget for DEI strategy. Each strategy is custom–designed to fit a company’s needs.” She explained that these budgets will most likely be presented to leaders who are not DEI practitioners, so it’s important to be mindful of the language used so that it makes sense to everyone. Those making the budget need to understand what business their organization is in and how diverse talent can fit into the business model they already have.
You must be smart about how you engage with leadership concerning a DEI budget. Subha mentioned that thinking like a businessperson is important, so that when communicating with senior leaders they understand where you are coming from and it’s in a way that’s familiar to them. They want to see facts and data around progress being made so that they feel comfortable approving a budget for the future. And now with a looming recession, the DEI team must focus on what is most cost-effective for the time being and what works for the company internally. That way, when the recession ends, those in leadership positions will see the good that is being done internally and more money will be allocated toward DEI.
One of the best pieces of advice Subha gave during the event was to come up with a five-year plan for your DEI budget. By starting small and really taking the time to plan out the first few years, with a focus on ERGs and DEI events and conferences, leadership will see a steady trend and want to put more money toward the budget. When planning your budget, you should plan as if times are “normal” and adjust it depending on the financial state of the country that year. Recalling her own experience as a CDO, Subha advised, “To integrate your DEI strategy into the greater business, you need to become an ‘internal consultant’ and rally support for your various groups.” Creating a long-term plan for how you will show success over time is how to get leadership buy-in.
One of the most important steps when setting your budget strategy is to establish metrics that will be used to measure success. The metrics that are chosen should align with the goals, so that everything comes together cohesively. For example, if your goal or priority is to hire and retain diverse talent and you decide to allocate $50,000 for unconscious bias training for performance management, your metrics may be the number of participants, an audit of performance management ratings, and a measurement of employee satisfaction in regard to performance management on employee surveys. Showing that you have mapped a clear plan for long-term success and that there is a way to measure it is also appealing to senior leadership and a way to ensure their buy-in. Having metrics to help track and measure success will help prove how instrumental your DEI budget is and will help to keep the DEI plan on track.
Budgeting is one of the most important things that is done at a company, and allotting money for a DEI team is something that should be a priority. By including DEI in your business’s budget, you’re showing employees that you’ve made a commitment to culture, inclusion, transparency, and action.
To speak with a Seramount expert about setting your budget strategy for 2023 or to gain access to our webinar recording, contact us.