The importance of DEI metrics in gauging ESG progress

Diversity, equity and inclusion (DE&I) is at the heart of everything an organization stands for. It’s not only the right thing to do for the workforce, it’s the right thing to do for the business. Study after study has shown that companies who are committed to DE&I are the most financially successful.

An organization that invests in DE&I reaps many benefits, including different perspectives and unique viewpoints, an increase in innovation and creativity; and improved engagement and productivity. They’re also more likely to attract Millennial and Gen Z job seekers and receive more applications from women.

Increasingly, DE&I is in the spotlight, as consumers, employees and shareholders are expecting companies to weave diversity, equity and inclusion throughout the three ESG pillars – Environmental, Social and Governance.

A company’s responsibility to the environment often has a more direct impact on marginalized communities than the population at large, for example. However, the “S” in ESG is where DE&I is most deeply embedded, as it focuses on how a company manages its relationships both internally and externally. Companies who actively recruit people from a range of ethnic and social backgrounds score high in this area of ESG.

Measuring DE&I goals

Many leaders have no idea how their organization is doing in attaining its DE&I goals for one simple reason – they don’t interact with the majority of their organization on a regular basis. They spend most of their time with their top 100 people who are, more likely than not, going to be like them. That’s not a criticism. It’s just a fact. It’s natural for us to gravitate toward people like us – in society, in relationships and in the workforce. Leaders tend to hire people from similar backgrounds who often think like them, too.

DE&I accountability leads to action

Last year, we formalized our DE&I commitments with the creation of an Inclusion and Diversity policy. It creates a common language, sets expectations and provides a framework against which we measure ourselves.

At Alight, we look at representation across levels, gathering data on race, gender, ethnicity veteran and disability status. We have not begun collecting information on gender identity, sexual orientation, parental or caregiving status, but we look at retention, attrition, succession planning and everything having to do with the employee lifecycle across the dimensions that we track.

We meet regularly with colleagues to ask them about their experience at Alight, evaluating what they are telling us and identifying where there are gaps. Once action has been taken to fill those gaps, we go back to that same group of people to assess what’s improved and where we still need to make changes, create transparency or implement new programs or policies. Much like treating a chronic medical problem, it’s an iterative process. You have to keep checking in, measuring and making changes as you strive for the optimum result.

Impactful insights from Alight's Global Impact Report

Having those metrics and that level of transparency is crucial for keeping us accountable. It also helps us participate in important initiatives like the Human Rights Campaign (HRC) Corporate Equality Index (CEI). We are proud that Alight has received a perfect score on the CEI for several years. While that accomplishment makes for an impressive press release and bragging rights to include in recruiting materials and our annual Global Impact Report, the most significant value of participating in such initiatives comes in the form of what it teaches us.

Organizations like the HRC set the standard for what is expected of employers in a particular context. Each year, as we are evaluated through their lens, we gain valuable insights into where we are succeeding and where we are falling short. Case in point: This year, the Human Rights Campaign adjusted their scoring criteria, holding organizations accountable to a higher standard of care for LGBTQ+ employees. We spent several months evaluating our policies, implementing training and ensuring that we enabled our employees to access information in a way that did not jeopardize their physical and psychological safety. We even helped our clients by creating an LGBTQ+ benefits guide that organizes all related benefits in one place, so employees don’t have to “out themselves” to get the information they need.

While we have yet to receive our score for 2023, we gained something even more important – the awareness that we needed to expand the support we provide our trans employees and their dependents. So while being recognized is important, the opportunity to acquire an understanding of what’s next enables us to draft our roadmap for the future.

As we engage in these conversations around DE&I and ESG, we are truly looking into the future of the workforce – and the workplace. While it may seem like ESG just recently entered the vernacular, this is a journey we’ve been on for a very long time. Advancements in technology have made the path clearer so we can better see the intersection between DE&I and ESG and how the two are converging in a sustained and focused way. At times, it may seem overwhelming, but it’s truly exciting to see it all come together, providing structure and guidance as we seek to better serve our people and our communities.