Can Chief Diversity Officers Succeed?
In the beginning of 2020, when the pandemic first hit and businesses started to realize its economic implications, guess which jobs were some of the first on the chopping block?
If you guessed jobs in Diversity, Equity and Inclusion (DEI), you’re absolutely right. In the frenzy of response strategies and emergency planning, many businesses determined that these positions were expendable. That was partly due to a business rationale – Diversity positions are not exactly responsible for supply chains or sales – but it was also the product of 50+ years of corporate America diminishing and disregarding the role DEI plays.
It was therefore an ugly irony when the murder of George Floyd (May 2020) prompted so many of those corporations to rethink their position. Suddenly, corporate leaders were terrified about how to respond to their employees. Movements like Black Lives Matter took center stage and encouraged us all to question what role our institutions – government, business, education – were playing in systems that enable the murder, brutalization, and incarceration of so many Black bodies.
These companies wasted no time in realizing their mistake, and an unprecedented boom in DEI hires ensued. New heads of Diversity in the S&P 500 index were hired at a rate of about 12 per month in the period following George Floyd’s death – almost three times the rate in the 16 months prior.
And of course, the interest in hiring Chief Diversity Officers wasn’t exactly new: according to LinkedIn data, titles with “head of diversity” increased 104% from 2015 to 2020 (68% for “chief diversity officer”). Still, only about half of the S&P 500 have a Chief Diversity Officer role or equivalent (53%), and the majority of them were hired between 2016 and 2022.
The market is full of demand. That’s one of the reasons CDOs experience such high turnover: the average tenure is now under 2 years (1.8), compared with 4.9 for CEOs. While some of this comes down to a competitive marketplace for the job, it also points to the tremendous burnout experienced by those in the role. CDOs aren’t staying put because they so often have too little support and too much responsibility.
The industry of Diversity is certainly booming. But in my view, one of its biggest obstacles is a widespread misunderstanding of the Chief Diversity Officer role. I have spoken to dozens of people in this position – you can listen to one of them, with Donna Johnson, former CDO of Mastercard, on my Race At Work podcast. Most have expressed deep frustration with their lack of resources, not to mention the lack of recognition they receive for a seemingly impossible task.
Part of the problem is the George Floyd effect: when Diversity officers (chief or not) become a solution to improving a company’s reputation, they join companies who are reacting, not strategizing. The events of 2020 forced companies to recognize that CDOs are a must-have – not just a nice-to-have – but that did nothing to educate organizations on what the role is and how people succeed in it.
And that question is a good place to start: what is the role of a Chief Diversity Officer? I think the answer depends on what role you think DEI plays in the first place.
If you believe DEI exists to make people feel better at work, then the Chief Diversity Officer becomes something of a hand-holder, who guides the organization through trainings and difficult conversations. If you think DEI exists to protect a company, especially legally and reputationally, then the Chief Diversity Officer is more of a spokesperson. They exist primarily to represent the company’s commitment to DEI issues and communicate its successes, particularly in times of increased scrutiny (e.g. a lawsuit).
But if you believe that diverse workforces, equitable policies, and inclusive cultures actually help a company perform better, then the job becomes something more complex. It has to encompass the development and execution of an end-to-end strategy, which means involving operations, HR, marketing & comms, consumer/customer insight, research, data analysis, employee engagement, governance, compliance, executive coaching…in short, a hell of a lot.
Even if a CDO’s responsibility were only to improve performance, it would be a huge job. But the truth is that the CDO role is also expected to be the first two options as well: an internal leader and a public-facing ambassador.
This is an incredible amount of work for one department, let alone one person, so it’s no wonder that CDOs report frustration. Some companies make it even harder for them: 53% of the CDOs in the S&P 500 Index hold an additional role that is unrelated to diversity and inclusion.
Given that the nature of the role continues to evolve, the frustration shouldn’t come as too big of a surprise. The CDO’s remit changes from one year to the next, especially as our culture becomes more passionate about diversity issues at work. And the role wasn’t created out of thin air: it’s the product of a long history of diversity initiatives in private and public organizations being met with indifference and derision.
When you’re the first, second, or third person to ever hold a CDO position in a company, you have a lot of learning and persuasion to do. Unfortunately for many in the position, there is a lack of resources available to pursue both those goals. In a survey of 100 CDOs conducted by Russell Reynolds, 65% of the respondents said they did not have the resources to track employee demographic data. These CDOs can’t even understand the impact of their own work with one of the company’s most basic metrics! Some CDOs are even hired to lead a department containing no one else but themselves.
Many CDOs also rely on their internal relationships to see changes implemented, monitored, and refined. But with high levels of turnover and resistant internal cultures, they constantly have to start those relationships over again.
So how do we work around these numerous obstacles? I think we need a paradigm shift when it comes to thinking about the CDO role, which means changing how we think about the value of Diversity, Equity and Inclusion.
That starts with expanding the business case for DEI beyond the financial. Many studies have now shown that more diverse businesses correlate to improved financial performance. And intuitively this makes sense: more diverse teams working at companies that prioritize DEI will experience more dynamic, empowering environments. That helps yield better results.
But we can get more specific than that. Researchers have now shown that companies that make DEI a priority tend to have cultures that are more open to learning from people’s differences. When people are unafraid to ask questions or share their authentic experiences about a difficult subject like gender, identity, or race, that builds trust. And trust makes relationships stronger, which in turn helps teams weather different kinds of storms that they may encounter like knowledge gaps or other obstacles in their processes.
Often, that openness is enough to help an organization’s culture become more focused on learning in general, which leads to better performance, products, and connections between people. In other words, DEI strategies are not just about the bottom line: they’re also about learning and team effectiveness.
If we see DEI as a means of improving performance, then the imperative for the rest of the C-suite to fund and support the CDO becomes much clearer.
But that support also has to come from the rest of the organization. CDOs clearly have to have the right people, budgets, and senior backing behind them. Equally, they need support from the rest of the organization, which starts with everyone from the bottom up recognizing the role they play in executing a DEI strategy. Again: the CDO is not in themselves a silver bullet.
It reminds me of one of the earliest instances of a DEI strategy in US history. In 1941, a group of Civil Rights leaders that included A. Philip Randolph and Bayard Rustin were planning a March on Washington. They were, in part, protesting discrimination in the Department of Defense, which was reluctant to hire Black workers, even when they had the necessary skills to help prepare the nation for WWII.
Thankfully, in June of 1941, President Roosevelt finally recognized what was at stake and issued an Executive Order banning any discrimination in the national defense program “on the basis of race, creed, color, or national origin…”
“...in the firm belief that the democratic way of life within the Nation can be defended successfully only with the help and support of all groups within its borders.”
Executive Order 8802 (1941)
FDR was progressive, to be sure, but he was also no fool. He understood that in order for the US to meet the demands of the war, “all groups within its borders” had to be involved.
It’s a good example of what happens when pressure is applied from the top down and the bottom up. The push and pull between the president and Civil Rights activists is what got that executive order through and made change happen fast.
Policy change is only effective if it’s designed for a receptive environment. Unless everyone in an organization believes in the value of creating systemic change, CDOs will continue to fight their battles with soldiers who don’t know what or whom they’re fighting for.
The first step, as always, is to reframe the narrative. CDOs do not exist simply to solve problems, save face, or mitigate crises. They are integral strategists and implementers whose business is improving the performance of an organization. By improving diversity metrics and implementing DEI strategies, they are able to transform culture. That goes beyond the bottom line: CDOs help companies build internal resilience and the external reputation they need to thrive in a world of intense scrutiny, disruption, and competition.
Consumers and talent, who are becoming more diverse every year, are watching more closely than they ever have. And if that isn’t a persuasive business case, I’m not sure what is.
Porter Braswell
