In today’s climate, championing diversity is table stakes for organizations that want to succeed. Employers are still reeling from the Great Resignation and labor shortages, and employees are now holding those in charge accountable for the promises they’ve made about championing diverse talent. In fact, Seramount’s recent insight paper, “ESG and DEI: The New Indicator of Employee Stakeholder Satisfaction,” found that 71% of individuals are willing to take a pay cut to work for a company that aligns with their values.
Many organizations have a long way to go in advancing DEI, and the retail industry is no exception. According to McKinsey, women hold only 26% of board positions within the retail sector, while only 13% of underrepresented talent hold executive positions. DEI progress in retail has a long way to go as only 16% of retail organizations view DEI as a top priority and only 36% are actively recruiting from underrepresented groups.
Change is scary but necessary to continue to evolve and become a better company. Here are three things that organizations within the retail industry should consider when developing a DEI strategy:
One way to amplify diversity in retail is by encouraging diversity from the bottom up. Demographic data shows that the most diversity within retail organizations is at bottom-level positions. When you look at the representation within leadership positions, not only is it less diverse, but it is also harder for diverse hires to make it further in the process. According to Seramount’s “Retention in Retail” research report, nearly one-fourth of retail employees who quit their jobs reported doing so because of a lack of career development opportunities. Organizations that make a point to not only recruit diverse talent but also to develop them, are more likely to retain their employees and see them rise through the ranks.
In a study conducted by our DBP member organization, Sephora, three in five shoppers reported having experienced discriminatory treatment. In an effort to reverse this trend, Sephora and Open To All launched a charter, supported by Seramount, where 28 retail brands signed on to improve the retail environment by mitigating racially biased experiences. By supporting those in retail spaces who often feel underrepresented and underappreciated, organizations will notice a remarkable change that will lead to increased revenue from customers and increased innovation from employees. Making changes within the shopping experience benefits organizations from a financial standpoint because consumers want to feel like they are making a difference with their spending. Consumers like to see themselves represented where they shop so that they feel like they are spending their money at a place that respects and values them – not only as a customer but as a human as well.
Companies that publicly share what they are doing to better themselves are also more likely to succeed. Employees are proving to believe that actions speak louder than words, and they will no longer accept empty promises. Yet, only 24% of retailers say that communicating their ongoing and future DEI initiatives is one of their key initiatives this year. That’s not enough! An organization’s DEI strategy should be communicated to everyone within the organization as well as to applicants who are being considered for hire. When employees understand the reach of DEI objectives, they are in a better position to help achieve those goals. People like the ability to hold companies accountable for what they promise to do in the inclusion space. They want to see change and will settle for nothing less.
It’s now more important than ever for the retail industry to prioritize DEI initiatives to enact lasting change. Employees and potential hires expect that promises made by organizations are acted upon and come to fruition. By expanding hiring pools and employing candidates from more marginalized communities, the retail industry will see a higher retention rate and get to hear different perspectives on ideas that are brought to the table. People coming from different backgrounds and life experiences bring new ideas and a fresh perspective that ultimately attracts more customers. Employees are the foundation that makes these industries run, and they want to know that their employers hear them and are acting on their promises. By moving with intention, lasting change can happen in the retail space.
Read our Best Practices report “Building Brand Through Diversity & Inclusion—Best Practices at Retail Companies” to learn about what some of our retail member organizations have been doing to advance DEI.
Not a member? Contact me directly at [email protected] to receive a copy of the report and learn more about how Seramount solutions can help advance your DEI strategy.