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Don't Be Afraid of Diversity

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In an increasingly diverse nation, both business and government have started to learn that embracing diversity -- not just with feel-good language but in real, concrete terms -- can make everything they do better. That notion seems to scare the daylights out of some people, but the tide of history is running against them.

As Nicholas D. Kristof noted in a recent New York Times column, "In business, there's abundant evidence that inclusion of women in senior positions is linked to better results. Catalyst, a research organization, found that the companies with the most women board directors earned a 26 percent higher return on invested capital than the companies with the least women."

The evidence shows that diversity works, that if your team includes people from a variety of backgrounds -- in terms of race, ethnicity, gender, sexual orientation, social and class background, etc. -- you get better results. A scholarly review published over 20 years ago by the Academy of Management noted, "Organizations' ability to attract, retain and motivate people from diverse cultural backgrounds may lead to competitive advantages in cost structures, and through maintaining the highest quality human resources."

Big companies increasingly understand this. As Ford Motor Co. executive James J. Padilla said recently:

"True diversity, I believe, celebrates the rich qualities and experiences employees bring to their jobs each day and considers those qualities to be among the company's greatest assets. This, of course, is a matter of fairness and justice, but it is also good business. We are a global organization with employees and customers around the world. ...

To fully appreciate these diverse perspectives and to ensure that we have the best talent available to do so, we believe it is critical that we create a culture of inclusion at Ford."

Plenty of other corporate officials have made much the same case, including the President and CEO of ADP.

This concept unnerves some on the far right, who consistently fall back on a couple of tropes that are potent but fundamentally dishonest.

A recent National Review Online attack on a small but important diversity policy illustrates this. In this case, the target was a set of draft standards released by six major federal agencies that regulate our financial system. The guidelines came from the agencies' Offices of Minority and Women Inclusion, offices created by the Dodd-Frank financial reform law. The draft lays out a series of best practices that banks and other financial institutions can use to bring new, diverse blood into their management teams as well as to diversify their contracting beyond the standard "old-boy networks" that are so often dominated by firms owned and run by white men.

We took a look at the proposed standards and were underwhelmed. While the general language and thrust were terrific, we didn't see a lot of mechanisms for followup or accountability. Firms are asked, for example, to assess their diversity practices, but aren't required to report their findings to anyone.

National Review's Roger Clegg, on the other hand, looked at these rather weak standards and saw ... Quotas!!! Indeed, he headlined his piece, "Dodd-Frank's 'Diversity' Quotas." Clegg is alarmed because the document makes a number of references to "metrics" and "percentage[s]," which he calls code for quotas. Except that there are no quotas. There is no enforcement mechanism. But opponents of diversity can't seem to resist seeing a quota hiding under every bed, while avoiding the obvious question: How could you ever assess something -- anything -- without measuring it?

Then, Clegg gets to the heart of the far-right case against diversity, complaining that the guidelines contain no "mention of stopping or preventing discrimination -- the only possible justification for consideration of race, ethnicity, and sex in hiring, promotion, and contracting" (italics added).

Remedying discrimination should always be a high-level goal. But it is far from the only reason to think about things like race and gender, as the examples above show.

Of course, I'm not a disinterested observer. I work for an organization that encourages diversity as part of our work to promote economic development and progress in America's communities of color. We also have plenty of hands-on experience in our own office, with a staff that's as diverse as can be imagined. I routinely interact with people whose lives have been entirely different from mine, and I learn things from them that I could never get from a book or a graduate course. That makes me a better manager and advocate. It makes our organization stronger and smarter.

As executives like Padilla understand, this is not just about ending intentional discrimination. To merely say you're willing to hire people from diverse backgrounds or to contract with firms owned by women or people of color is nice, but it won't get you very far if those people don't know your door is open. It takes a conscious effort to reach out beyond your usual network. It may mean rethinking where and how you recruit staff or search for vendors. As Kristof notes, Twitter's board has been composed of "seven white men" -- not because the company put up a sign saying "no women need apply" or "whites only," but because it seemingly never dared to step out of its comfort zone.

Stepping out of one's comfort zone from time to time is healthy. And for a nation whose majority will soon be people of color and whose future prosperity depends on the success of all of our communities, diversity is an asset to be treasured, not a threat to be feared.