The document discusses embracing diversity and inclusion in the workplace. It notes that diversity covers many personal characteristics and can boost business performance by increasing globalization, changing workforce values, and improving reputation. Embracing diversity requires analyzing workforce composition data to identify gaps and understand trends. While increasing inclusion often improves engagement, organizations must also create a truly inclusive culture to see benefits like higher productivity and profits. Senior leadership support is essential to building an engaged workforce and implementing diversity initiatives effectively.

1. Embracing diversity and equality for
a more inclusive organisation
Diversity itself covers a wide range of dimensions
that differentiate groups and individuals from one
another. There are the aspects of which most
employers will be aware – age, race, gender, sexual
orientation, religious beliefs and physical ability –
however, this list can also extend to other factors
such as parental status, geographical location,
social class, political beliefs and even hobbies
and interests.
In a business context, there are a number of powerful
drivers towards embracing a diverse workforce and
inclusive culture. These include the increasingly
globalised nature of business, with clients, suppliers
and competition often coming from overseas; the
changing values of today’s workforce, with employees
themselves often more attracted to a diverse and
inclusive workforce; and the manner in which the
organisation is perceived externally, by potential
customers and the wider public. More practically,
a genuinely diverse workforce can help to tackle
issues created by fundamental shifts, including an
ageing labour force and talent shortages in certain
sectors, giving organisations a competitive edge in
today’s economy.
The starting point for any evaluation of how and where an
organisation can improve the diversity of its workforce is
data: analysing the composition of the workforce as a whole
across different levels of seniority, length of service and other
demographic groups.
Nick Tatchell
Director, Organisational
Surveys and Insights
Gonzalo Shoobridge
Senior Consultant,
Organisational Surveys
and Insights
Emma Palfreyman
Senior Consultant, Benefits
Deploying the power of diversity and
inclusion to boost your business

2. Over the past decade there has been a greater
understanding of the business benefits which a
diverse workforce can bring, says Nick Tatchell,
Director, Employee Surveys, at Towers Watson, and
with this a stronger emphasis on the inclusivity
aspect of talent management. “The biggest focus for
talent management some years ago was exclusivity;
the search for the few special people who had the
X-factor,” he says. “Now transformative talent
management refers to the workforce in its entirety;
you can still segment but it’s about enabling the
whole workforce to perform to its full potential.”
Despite this, a lot of organisations have considerable
work to do. “Too often, the motivation is to do the
bare minimum with the focus being on compliance
with legislation,” says Tatchell. “While that is
necessary, it’s far from sufficient in terms of realising
the true opportunity that comes from diversity
and inclusion.”
There are, though, still barriers to implementing
diversity in practice. At a recent Engagement Network
seminar run by Towers Watson, over half of HR
specialists (57%) felt traditional structures –
including factors such as a fear of change and an
unconscious tendency for those in the majority to
surround themselves with people of a similar
background – were the biggest block to implementation
in their business. More than a fifth (22%) felt the
biggest barrier to diversity is down to a range of
misconceptions, such as the view that diversity can
lead to impaired organisational effectiveness, that
some groups lack commitment, or that it may drive up
the overall cost of employment.
A further danger is that organisations which
introduce programmes designed to create a more
diverse workforce are often disappointed when
business benefits – in the form of greater productivity
or higher profits – do not immediately materialise.
Commentators and researchers alike are often guilty
of making the direct link between diversity and
business performance, but this is only likely to
happen if they have also taken steps to create a truly
inclusive culture which leads to employees being
more sustainably engaged.
Where the right processes are in place, however,
there is evidence of links to better business
performance. Towers Watson’s own client work has
revealed that increases in inclusion lead to a rise in
employee engagement, which is directly linked to
performance. However, managers and boards need
to be aware there is no silver bullet, and that some
aspects of performance can even dip before
bouncing back.
The starting point for any evaluation of how
and where an organisation can improve the
diversity of its workforce is data: analysing the
composition of the workforce as a whole across
different levels of seniority, length of service and
other demographic groups.
For example, one organisation found that a gender
gap emerges with length of service; Towers Watson
analysed their data and found a relatively equal split
of 53:47 male/female ratio among staff who have
served less than six months, but this widened over
time to stand at 61:39 for those with between 10
and 15 years’ service. For those who had been with
the organisation for more than 15 years, the gap was
even more significant, with a 73:27 split in favour of
men. There are underlying demographic reasons
for this – many women give up work or move jobs
after having children – but such analysis can be
a useful means of identifying potential problems
and solutions.
More in-depth analysis can be conducted into
employee attitudes, which again can be segmented
by particular groups or sections of the workforce, to
identify trends or anomalies. This data can then be
compared with external benchmarks to provide
context. For example, this can reveal a gradual
disillusionment creeping in with age; morale often
decreases among workers in their mid-30s, for
instance, and rises again around the age of 50.1
Such understanding of wider trends can be important
in identifying and understanding where genuine
issues with diversity may lie. However, organisations
must also be careful to act on the findings of any
such employee research if the entire exercise is not
to be counterproductive and only serve to alienate
those who already feel less included.
““57% of HR specialists felt that factors such as a fear of change
and an unconscious tendency for those in the majority to
surround themselves with people of a similar background,
were the biggest block to implementation in their business.”
2 towerswatson.com Diversity and inclusion

3. There are signs that diversity is being taken more
seriously by organisations in general. At the recent
Engagement Network seminar on diversity and
inclusion, 80% of delegates agreed that the
management of their organisation supported
diversity in the workforce.
Having senior leaders support the concept of diversity
and inclusion, alongside efforts to put it into practice
is essential, and can go a long way to building a more
loyal and engaged workforce. Gonzalo Shoobridge,
Senior Consultant, Organisational Surveys and
Insights, at Towers Watson, gives the example of a
retail organisation where those from ethnic minority
backgrounds would often find themselves subject to
targeted abuse from customers. “The chief executive
said this was unacceptable,” he says. “They looked
into it and found that all those shops with higher level
of bullying and harassment by customers were located
near pubs, it was decided to implement a zero
tolerance approach, put in extra staff and security
cameras with a link through to the police. Through
these actions, the company’s leadership and respect
for corporate values really came across and was
appreciated by employees.”
Often, it’s not just about what organisations can do to
improve diversity and inclusion – it is important for
employees to be involved too. Employee networks and
communities can be a good way to achieve this.
Emma Palfreyman, co-chair of Towers Watson’s own
Women and Supporters Associate Community, says
being a part of a community is an opportunity for
associates from different parts of the business to get
to know each other, leading to a better connected
workforce and more engaged employees. “For us,
we see involvement in running the community as a
valuable development opportunity for the volunteers.”
Having commitment from the organisation and fellow
employees is also vital, says Palfreyman. “To make
our community sustainable in the long run, we have
worked hard from the outset to get the governance
set up right – ensuring we are connected with the
business and reporting back regularly on progress
being made,” she says. “We also have strong
support from leadership and that is key to the
success of any community.”
In some cases, there may also be a need for
incentives to encourage organisations to address
this issue. Fiona Hathorn is Managing Director of
Women on Boards UK; an organisation that supports
women to navigate their pathway to the boardroom.
She gives an example from Australia. “There they
have changed the law so if you employ more than
100 people and you don’t display data around
diversity you can’t bid for government contracts,”
she says. “That’s what we need here in the UK.”
While issues of diversity and inclusion in the workplace
can be highly political and complex, the business
benefits to organisations that create a genuinely
inclusive culture are becoming clearer in terms of
improved engagement, greater innovation, enhanced
reputation as an employer, and ultimately stronger
more sustainable business performance. “This link to
performance is vital,” says Shoobridge.“However, we
can’t lose sight of the moral case for promoting
diversity and inclusion in the workplace – it is simply
the right thing to do.”
1
Yves Duhaldeborde, Rodolphe Delacroix (2013). Talent
has no age limit – engaging workers across all generations.
Towers Watson.
““Having senior leaders support the concept
of diversity and inclusion, alongside efforts
to put it into practice is essential, and can
go a long way to building a more loyal and
engaged workforce.”
Diversity and inclusion 3towerswatson.com

4. About Towers Watson
Towers Watson is a leading global professional services
company that helps organisations improve performance
through effective people, risk and financial management.
With more than 14,000 associates around the world, we
offer consulting, technology and solutions in the areas
of benefits, talent management, rewards, and risk and
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TW-EU-2013-35497. January 2014.
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