Racial Equity in the Workplace: How to get the most out of your diversity budgets

When it comes to anti-racist progress at work, it’s a case of putting your money (and metrics!) where your mouth is.

Racial equity has the power to transform commercial performance. Businesses making a dedicated effort to increase racial equity record 58% higher revenue than those who do not. It’s also been calculated that if BIPOC talent was fully utilised in the UK, our economy would be £24 billion better off, every year. Not to mention the other business benefits, such as productivity, retention, and innovation, which directly correlate with this.

Yet despite the proven benefits, many organisations have been criticised for doing too much talking and not enough acting, with ineffective measures put in place that fail to deliver. But not delivering is no longer an option. Society is now demanding racial equity results, not just well-meaning messages. And this is starting to hit organisations on the bottom line. Gen Z and Millennials say transparency on social issues is their top priority and many are willing to stop buying from and working for brands that don’t do enough.

An example? We only need to look at the social pressure put on organisations to provide evidence of racial equity in the workplace, following commitments and pledges to the Black Lives Matter movement. Organisations with shady pasts or negative racial connotations, like Aunt Jemima in the US, need to do much more than change their packaging to be seen as anti-racist. If you, like over 950 brands, posted a black square for #BlackoutTuesday in 2020, you’d better be prepared to back that square up and keep participating in racial equity conversations long after it stops trending.

Spending money is easy, creating change takes work

We understand that organisations are under intense external and internal pressure to move beyond good intentions and drive tangible change when it comes to racial equity. Every penny of a DE&I budget matters and its impact needs to be measured effectively to drive results.

But organisations can’t expect to see results without putting in the work—this means taking the time to get to the root cause of the problem, finding targeted solutions, and reporting on the return on investment of the budgets committed to achieving these goals.

The downfall of current D&I initiatives rolled out by many firms has been spotlighted in recent news. Organisations spend upwards of £5.5 billion annually and have little to show for their efforts. In spite of good intentions, organisations are currently tackling racial inequality from the wrong angle—and are failing to achieve their desired outcomes as a result.

Understanding what you need to do to prove your commitment to racial equity lets you direct your budget to where it can have the most impact. So, before you open your cheque book and spend large sums of money, ensure that you are in the right place to begin your journey towards cultural change with these 3 simple steps.

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Three steps to smarter racial equity spend

1. Understand the root cause of the problem

Don’t let data be an afterthought when committing budgets to your anti-racism strategy. Data is the key ingredient in understanding, measuring and advancing change in any area of your organisation. Without the right data, you cannot understand the problems to target or how to best allocate your budget to solve them.

Rather than focusing on racial diversity alone, it’s important to also monitor anti-racism within your workplace. Metrics such as inclusion barriers, racist behaviours, and racial awareness will be key to understanding how you are progressing the culture at your organisation to ensure all ethnicities can thrive.

Create a proactive and targeted strategy to track racial bias in your company and see how much progress you are making to overcome it. This will help you to clearly evaluate whether your budget is being put to good use.

Find out how FLAIR’s solution enables organisations to measure, track and overcome racial bias >

2. Set clear goals to better determine a budget

What are you trying to achieve for racial equity in your workplace? And are your ambitions specific enough? After all, setting the objective of hosting 5 events and quarterly anti-racism training doesn’t mean that change will necessarily follow.

Apply the SMART structure to your racial equity goals: make sure they are specific, measurable, attainable, relevant and time-bound. For example:

• Increase BIPOC representation in middle management roles by 35% by 2023
• Improve employee satisfaction amongst black and ethnic minority groups by the next annual ‘pulse’ study

Without the accountability of SMART goals, it’s all too easy to waste money talking instead of providing an evidenced approach towards achieving material change. Setting clear objectives, and knowing how to measure them, helps track your progress. It also keeps everyone focused and pulling in the same direction.

3. Measure the success of your anti-racism programmes

And so we come to the final piece of the puzzle: measuring the impact of your anti-racism strategy.

Technology has transformed how businesses understand, measure and track the effectiveness of their business operations — and it has a role to play in anti-racist progress. Why? Because racial equity can’t be deemed an emotional or out-of-bounds topic; it needs to be tackled head-on like every other problem limiting revenue potential.

Tools need to be in place to gather the evidence, identify the problem, pinpoint key metrics and proceed with unrelenting focus to meet the clear goals you’ve set.

But don’t hold out for overnight change. Seeing impact from your racial equity budget is a long game; Year-On-Year benchmarks are required, as are more frequent ways of gathering feedback too.

It’s also worth keeping one eye on your competitors. How well are your competitors progressing towards racial equity in the workplace and what do you need to do to keep up?

Leave empty spending behind in 2022

Racial equity represents one of the greatest challenges facing organisations, even during these tumultuous times… but it is also the greatest opportunity. Put considered time and budget into anti-racist activities at work, and see just how much it pays back.

FLAIR can help you to get the most out of your racial equity efforts and budget, resulting in positive change that’s good for you, your company, and the society we all share. Contact us today to get the support you need to create an ambitious anti-racism plan for 2022 — and then achieve it.