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The diversity industry is worth billions. But what do we have to show for it?

A new book out today, ‘Diversity, Inc.,’ looks beyond the corporate hype to reveal if there’s been any actual progress toward equality.

The diversity industry is worth billions. But what do we have to show for it?
[Photo: StudioRoma-biz/iStock (money); source illustration: pressureUA/iStock]

Diversity has become not only a buzzword, but an industry unto itself. Against a backdrop of social upheaval as evidenced by Black Lives Matter, #MeToo, #OscarsSoWhite, and the like, issues of diversity and its implications have touched virtually every sector.

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In the corporate world, we’ve seen public pronouncements made by CEOs about their commitment to diversity, frequently on the heels of a specious racial incident within their company, followed by the high-publicity hiring of a diversity officer or consultant. Yet these efforts have rarely yielded meaningful progress in advancing diversity. In fact, they have sometimes backfired, as in the case of Denise Young Smith, Apple’s first vice president of inclusion and diversity.

During a panel on diversity in 2017, Young Smith, who is black, was asked whether she would focus her efforts on underrepresented minorities, including black women, and she responded, “I focus on everyone. Diversity is the human experience. I get a little frustrated when diversity is tagged to people of color, or the women, or the LGBT.” Young Smith went on to note “there can be 12 white, blue-eyed, blonde men in a room and they’re going to be diverse too.” After her words were roundly criticized, she emailed an apology to her colleagues, but just months later she was no longer holding the position. This episode epitomizes how diversity is both hypervisible yet elusive.

A new book out today, by journalist and New York University professor of journalism Pamela Newkirk, Diversity, Inc.: The Failed Promise of a Billion-Dollar Industry, explores the sociocultural context that gave rise to diversity initiatives across the academic, entertainment, and corporate sectors and examines why despite spending billions of dollars on highly publicized diversity initiatives, so many of them ultimately fail.

Newkirk charts how diversity initiatives grew out of laws that sought to address the economic inequities created by historical oppression and discrimination, such as the creation of the Equal Employment Opportunity Commission, but notes that despite becoming a buzzword, there is no agreement on what diversity encompasses. “Diversity has become a catchall term that encompasses everything from race, gender, sexual orientation, and body size, to mental and physical capacity and eye color, and there’s little agreement on the definition or institutional goals across and/or even within sectors. . . . Race is often eclipsed by these other categories even as racial discrimination is doubly and triply compounded by [them].”

So, how did we get to the point where we’ve been talking about diversity for so long but have little to show for it? In truth, many companies were not only making scant efforts toward diversifying their ranks but forestalling them. It took high-profile, costly class-action lawsuits to force them to take demonstrable action on diversity. Newkirk chronicles these lawsuits and shows how Coca-Cola’s settlement agreement in 2000 spurred the company’s leadership to make diversity a business imperative, creating a task force and transparent metrics to track their progress. According to Diversity, Inc., in 2000, 16% of the company’s senior leadership hires were women and 8% were members of a minority; and by 2005, this had risen to 27% and 21%, respectively. Coca-Cola’s success demonstrates how treating diversity like other business priorities that receive leadership’s true commitment can make a difference.

But the Coca-Cola case also raises a troubling question. Is the threat of lawsuits the only way to motivate companies to pursue meaningful progress on diversity? Newkirk is circumspect yet hopeful about what motivates institutional diversity efforts. “Change can certainly come without lawsuits, especially when leadership is committed to diversity. Sadly, much of the change we’ve seen has been prompted either by civil unrest, lawsuits or the fear of them, or by social movements like #OscarsSoWhite or #MeToo that highlight systemic inequality. . .. For some, diversity efforts appear to be inspired more by concerns over public relations than social justice.”

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The best companies are driven by metrics when it comes to tracking and assessing their profits and operations, and they use these metrics to make internal changes to their processes. Yet, contradictorily many companies don’t hold themselves to quantifiable results when it comes to assessing and addressing their diversity. Newkirk explains this contradiction by observing, “Perhaps it’s because most people don’t believe they’re biased and think hiring decisions should rely on ‘merit’ and not on quotas or other racially conscious strategies, as if they are mutually exclusive.” She goes on to offer a clear and obvious solution: “If companies began to quantify their practices related to race and gender, they would be able to detect and disrupt patterns of inequality.”

Corporations that have carried out some manner of diversity efforts have typically hired a diversity officer or a diversity consultant who conducts staff anti-bias training, which can be costly and which doesn’t guarantee success. When it comes to diversity officers, they may not be integrated into the leadership of the company, which means no matter how lofty their titles, they are unlikely to be able to effect actionable change. This too assumes that the company is clear and definitive about the change they seek. Newkirk cites a 2019 survey by Russell Reynolds of 234 diversity professionals at S&P 500 companies, which revealed that more than half said “they do not have the resources or support needed to execute programs and strategies, and only 35 percent had access to company metrics.”

The lack of definition, metrics, and outcomes, however, hasn’t prevented the field of diversity from exploding. Newkirk points to many indicators of the diversity field’s growth, from a 2003 estimation that corporations were spending $8 billion on it, to a 35% increase in 2018 of diversity and inclusion online job postings, over the two previous years. There has also been a proliferation in degree and certification programs on diversity and inclusion leadership, some of which are being offered by universities, which have not made significant strides on their own lack of diversity, as Newkirk keenly observes.

So, given all the talk about diversity amid the lack of progress, what is the way forward for companies? First, Newkirk points out that the corporate sector has actually made more advancements than other seemingly more progressive sectors, such as the academic sector and Hollywood. However, there is still much need for progress when it comes to diversifying the upper ranks and boards of companies. She cites figures from a 2016 EEOC report that show that while white people make up 61% of the workforce, they hold 85% of executive-level positions and 71% of midlevel management positions. Meanwhile, she cites a study by the Alliance for Board Diversity and Deloitte Company that shows that 70% of Fortune 500 board seats are still held by white men, while women and minorities account for about 31%.

Second, diversity efforts are generally more effective when approached as integral to a company’s business strategy and addressed with the same priority as other crucial business objectives. If a company hires a diversity officer, that officer’s mandate should be clear, and the role should be integrated into the company’s leadership so it can be impactful.

Similarly, diversity consultants should be assessed just as any other business consultants, on the basis of their knowledge, experience, and outcomes. And while they can conduct internal trainings and make recommendations for changes in policies and practices, they don’t have the power to make those changes.

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Diversity initiatives are necessary due to intractable societal issues such as racial oppression, gender discrimination, and stigmatization of sexual orientation, the impact of which are felt to this day. Intractable societal issues rarely have quick fixes; likewise, making meaningful progress on diversity within the walls of companies will require commitment, will, leadership, metrics, cooperative engagement, and accountability.

However, so much work remains to be done outside the walls of companies. Newkirk says that, as a country and a society, we must start by challenging the narrative of white “racial preeminence.” She powerfully concludes, “in the end, racial diversity will not be ushered in by pledges, slogans, or well-compensated czars. . . . Change will require resources and resolve, but no amount of money, no degree of effort, will succeed alongside a willful negation of our shared humanity.”


Kavita Das worked in social change for 15 years and now writes about race, culture, gender, and their intersections. Das is the author of Poignant Song: The Life and Music of Lakshmi Shankar.

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