Diversity messages may backfire when companies focus on diversity’s benefits for the bottom line
Companies that justify their diversity efforts by saying a diverse workforce will improve their bottom line risk alienating the diverse workforce they hope to attract, according to research published by the American Psychological Association.
That’s because such “business case” justifications for diversity can backfire, making members of underrepresented groups—such as LGBTQ professionals, women in STEM (science, technology, engineering, and math) fields—and black students feel like they will be judged based on their social identity when they join the company.
“These justifications for business cases are extremely popular,” said lead author Oriane Georgeac, Ph.D., a professor at the Yale School of Management. “But our findings suggest they do more harm than good.”
The research is published in APAs Journal of Personality and Social Psychology†
Many companies offer either a ‘business case’ statement for why they value diversity (eg, ‘we value diversity because it helps us better serve our customers and improve our bottom line’), or a ‘fairness case’ statement (eg, “we value diversity because it’s the right thing to do”). Georgeac and co-author Aneeta Rattan, Ph.D., a professor at London Business School, sought to examine how common these two justifications are and how they affect the impression of potential employees about what it would be like to work at a particular company.
First, the researchers collected the online diversity statements of every company on the Fortune 500 list and used artificial intelligence-based language analysis to analyze whether each statement was primarily a business case or a fairness case for diversity. Overall, they found that about 80% of companies provided a business case justification for valuing diversity, while less than 5% explained a fairness case; the rest have made no public diversity statements or provided any justification.
Next, the researchers conducted five online experiments in which they asked job seekers from three underrepresented social identities — LGBTQ professionals, female STEM job seekers, and black college students — to read business-case or fairness-case diversity statements from fictional companies and answer questions about how many connection they expected to feel there, and how much they would like to work there.
On average, the researchers found that among LGBTQ professionals, female STEM job seekers and black college students, reading diversity statements from the business case undermined their expected sense of belonging to the company, and in turn their desire to join the company. compared to reading honesty-based diversity statements or diversity statements that offered no explanation.
Further analysis found that one of the reasons the business case justification affected these participants was that it increased participants’ “social identity threat”, or their concern that the company would see and judge them, as well as their work, in the light of their social identity.
“At first glance, this rhetoric may sound positive,” Georgeac said. “However, we argue that by uniquely linking specific social identities to specific workplace contributions, business justifications for diversity justify the fact that organizations can consider individuals’ social identities when forming expectations about and evaluating their performance. In other words, justifications from corporate cases affirm to women and underrepresented group members that they should be concerned that their social identity is a lens through which their contributions will be judged. And this is threatening to these groups.”
Some surprising findings warrant further investigation, the researchers said. For example, they found that justifications for diversity can also lead to some social identity threat among members of underrepresented groups, although only about half as many as justifications for corporate cases. “We have more research to do here, but the possibility that no justification is the best justification for diversity is incredibly interesting,” Rattan says.
Some of the experiments in the study also compared the responses of members of underrepresented groups to those of well-represented groups. The researchers found that the business case sometimes also threatens members of some well-represented groups. “Men in STEM showed no differences in their responses to the different types of diversity justifications they read, but white Americans did appear to be threatened by the business case after the George Floyd murder, relative to the fairness case or no case. This seems like a discrepancy. between well-represented groups is fascinating and calls for further investigation,” Georgeac said.
Future research could also explore how justification for diversity affects members of other underrepresented groups, such as older workers; how well companies’ public diversity statements reflect their true internal motivations for diversity; and how diversity values affect the behavior of members of the organization, such as managers and executives, the researchers said.
Workplace diversity must be accompanied by an atmosphere of true inclusion
The business case for diversity is counterproductive: adverse effects of organizations Instrumental diversity rhetoric for underrepresented group members Sense of belonging, Journal of Personality and Social Psychology (2022). DOI: 10.1037/pspi0000394
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