How to Talk About Diversity With Employees to Achieve Your Company's Objectives

Catalyst offers research-based messaging guidance for senior leaders talking about DEI.

Emily Shaffer, PhD , Brittany Torrez, PhD

EXECUTIVE SUMMARY

Messaging about diversity, equity, and inclusion (DEI) matters now more than ever before. The way you frame your commitment to diversity to employees is critical because DEI is being challenged across the globe, and your positioning signals your priorities. For this global report, Catalyst surveyed 6,800 employees in 11 countries to find out whether they think companies should talk about diversity as the best thing to do for the bottom line (the “business case”) or because it’s the right thing to do (the “fairness case”).

Nearly half of employees told Catalyst they want their organization to talk about its diversity initiatives using both a fairness case and a business case. Of those who prefer one over the other, more than twice as many prefer the fairness case.

The fairness case has clear advantages in terms of employee results. When organizations emphasize the fairness case to justify their diversity efforts over the business case, employees are more likely to:

  • Experience inclusion.
  • Say their organization is fair.
  • Intend to stay in their organization.

Leaders: When you sharpen your DEI messaging, make sure you understand the nuances of both the fairness case and the business case so that your company’s DEI initiatives are set up for success across a variety of stakeholders.

Older woman writing on presentation board for a group

Why Your DEI Messaging Matters

Because of the backlash around the globe toward corporate inclusion efforts,1 some organizations are considering taking a step back from their DEI efforts and toning down their messaging about diversity.2 For example, the 2023 US Supreme Court decision on affirmative action3 and other state-specific legislation restricting DEI funding and programming4 may convince senior leaders to walk back their DEI commitments.

In addition to cultural and political pushback around the world, thought leaders are sending conflicting messages to organizations and DEI practitioners about what’s best. For example, recent headlines implore, “Enough Already With the Business Case”5 and “Stop Making the Business Case for Diversity.”6 At the same time, some other work urges organizations to use the “new” business case by being even more specific about diversity’s ties to business outcomes.7

Charting a communications strategy for diversity efforts that reflects your organization’s commitment and resonates with employees, leaders, and other stakeholders is hard—especially in today’s unsettled and strained landscape. It also requires the coordination of organizational leaders from HR, DEI, communications, legal, as well as managers and even employee resource groups (ERGs).

 
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Are Employees Tired of Hearing About Diversity?

No, they are not.

Companies in the Catalyst community continue to tell us that despite the recent pushback against inclusive policies, it’s absolutely critical for them to continue their DEI efforts. And our survey of 6,800 employees in 11 countries finds that employees overwhelmingly agree:

93%
of employees say that it’s at least somewhat important for their organization to be vocal about its DEI efforts.

76%
of employees agree that organizations should take strides to ensure that the workplace is diverse and inclusive of all employees.

24%
of employees report that their organization’s senior leaders never or rarely engage in discussions about diversity.


Employees’ desires are clear: DEI is important to them, and they want leadership to take an active stance and communicate clearly what is being done.

Two Approaches to Discussing Diversity Efforts: The Business Case and the Fairness Case

How, exactly, can an organization talk about why it is doing diversity work so that its reasoning resonates with employees?

There are two tacks organizations generally take to justify diversity efforts: The business case and the fairness case. While both highlight the importance of cultivating a diverse workplace, their reasoning is different—and this difference affects employees’ perceptions of their employer.


The Business Case

The business case justifies diversity initiatives by emphasizing how workplace diversity impacts the organization’s:

  • Bottom line or profits.
  • Innovation.
  • Brand and reputation.
  • Ability to attract and retain new talent.
Example: We value diversity because it is good for business. A diverse workforce brings new and innovative perspectives that give our company a strategic, competitive advantage. Our reputation for fostering diversity helps us attract and retain new talent.


The Fairness Case

The fairness case justifies diversity
initiatives by emphasizing how
workplace diversity:

  • Is the socially good and morally right thing to do.
  • Is consistent with the organization’s values.
  • Helps to overcome past societal discrimination.
  • Contributes to creating a fairer workplace.
Example: We value diversity because it is the right thing to do. A diverse workforce is not only fair; it is consistent with the broader values and culture of our organization. Our commitment to diversity helps to create a workplace where everyone is treated equally.

The Fairness Case Resonates With Employees

So, how should your organization approach these conversations with employees?

Catalyst found that while 52% of employees prefer one rationale over another, 48% of employees don’t have a preference—they want their organizations to use both the business case and the fairness case equally. Among those with a preference, a greater number favor the fairness case. A mere 15% of employees want the business case to be used alone.


Bar chart - 15% Business Case, 37% Fairness Case, 48% Both Equally

Which Approach Do Employees Want Their Organization to Use?

The Fairness Case Has Big Employee Benefits, Too

It’s not just about employee preferences: Our research shows that organizational messaging about diversity is also important because it impacts employees’ perceptions of organizational climate and decisions to stay at a company.

Experiences of Inclusion Business Case small arrow up Fairness Case large arrow up

Experiences of Inclusion8

  • Both the business case and the fairness case positively impact employees’ experiences of inclusion.
  • However, the fairness case has a stronger influence on inclusion than the business case; the fairness case is twice as effective at promoting inclusion compared to the business case.

Experiences of Inclusion Business Case small arrow up Fairness Case large arrow up

Perceptions of Organizational Fairness9

  • When organizations use a fairness case for diversity, employees are more likely to see their organizations as meritocratic and fair toward all employees, regardless of their social background.
  • The business case has no effect on employee perceptions of organizational fairness.

Experiences of Inclusion Business Case small arrow up Fairness Case large arrow up

Intent
to Stay10

  • The more an organization uses a fairness case for diversity, the more employees intend to stay in their organizations.
  • Conversely, the more a business case is utilized, the less employees intend to stay in their organizations.

KEY FINDING

  • Employees respond more positively to organizational messaging about the fairness case.
  • The business case:
    • Has a smaller positive effect on experiences of inclusion.
    • Has no effect on perceptions of organizational fairness.
    • Can harm retention.
  • Turnover is costly,11 and ironically, organizations that bolster diversity efforts by emphasizing the bottom line may end up hurting themselves in the long run.
  • Employees are tuned in to the fact that their companies aren’t making progress regarding DEI,12 and are more and more invested in working for companies whose values align with their own.13

The Business Case Is Linked to Negative Consequences for Team Members From Marginalized Groups

While the fairness case can improve employees’ experiences of inclusion, their perceptions of their organization, and their intentions to stay, the business case may have a detrimental impact on the daily experiences of employees from marginalized groups.

Recent research has found that:

  • The use of the business case for diversity has been linked to lower feelings of belonging in women and LGBTQ+ employees.14
  • Framing diversity simply in terms of its benefits to an organization can have negative consequences for hiring underrepresented job candidates.15

It makes sense that that this type of reasoning may lead some employees to question whether a company will decrease its commitment to diversity if it becomes financially or politically unfavorable.16

Our data tell us that when organizations use a business case for diversity, employees from marginalized groups are more likely to be on guard to bias—bracing themselves for bias and microaggressions—a hallmark of emotional tax at work.17 The negative effects are striking.

When organizations use a business case for diversity chart

 

KEY FINDING

  • Organizations that often use the business case with employees may inadvertently harm employees from marginalized groups.
  • Previous Catalyst research shows that reducing employee experiences of being on guard is associated with large increases in likelihood to stay at the organization, being engaged at work, experiencing team cohesion, reporting effective team problem-solving, and experiencing inclusion.22

Organizations Are Using the Fairness Case Together With the Business Case

Now that we know what employees want and how it affects them, we need to understand what messages employees are currently receiving from their organization. We asked employees what rationale(s) their organization uses when talking about its diversity efforts and found that most organizations are using both cases together, with only a few using one by itself.

KEY FINDING

  • Organizations can and do employ both cases when messaging their diversity efforts. These rationales frequently are not mutually exclusive.


Bar chart - 5% Business Case, 8% Fairness Case, 76% Both Cases 12% Neither Case

What Employees Say Their Organization Uses23

Emphasizing the Fairness Case Can Bring Employee Results

Just because both cases are used together doesn’t mean they’re emphasized equally. For example, it’s possible that an organization employs both rationales, but that the organization’s actions and messaging emphasize one more than the other. We wanted to know if the relative use of these rationales had an impact on employee outcomes.

According to our survey respondents:

  • 44% of their organizations emphasize a fairness case over a business case.
  • 34% emphasize a business case over a fairness case.

This relative emphasis makes a big difference. When organizations emphasize a fairness rationale to justify their diversity efforts over a business rationale, employees are more likely to:

  • Experience inclusion.24
  • Say their organization is fair.25
  • Intend to stay in their organization.26

KEY FINDING

  • When using both cases, organizations should emphasize the fairness case to increase the likelihood of positive employee results.
  • It may take some effort to assess and reconfigure your current actions, but your organization can and should make smart and meaningful changes, even—or especially—during times of flux.27

THE CATALYST SOLUTION

The political climate ebbs and flows over time, but organizations always need to employ diverse workforces and create workplaces where all employees can belong, contribute, and thrive. With a clearer understanding of how diversity messaging affects employees, organizations can calibrate how they promote their DEI efforts because it’s the fair thing to do, while also acknowledging that creating the best work environment for all employees can improve business outcomes.

Start Here

Align with your brand promise: Think about how organizational efforts to promote diversity naturally align with your organization’s culture and core values.
  • What is your organization’s mission statement?
  • How does creating a more diverse workforce enhance the mission?
  • What is the risk that your messaging can be seen as performative, and not aligned with corporate actions internally and externally?
Examine your “why” for DEI: Examine both the formal and informal messaging your organization makes when talking about the benefits of diversity.
  • What is the rationale your organization gives for its diversity efforts?
  • How does that message get filtered through the organization?
  • How are organizational leaders trained in the communication of these messages?
Know your audience:
  • Do employees prefer a fairness rationale for diversity efforts while organizational shareholders are more interested in understanding the organizational benefits of diversity?
  • Can the organization cater its messaging to these different preferences while staying true to its values?

As our data show, both the business case and the fairness case for DEI are valid and important. It may make sense to lean on one rationale with one audience and the other rationale with other audiences and show how each aligns with the values of your organization. In these polarizing times, knowing your audiences and crafting messaging that resonates most forcefully with each is essential to creating a workplace where everyone can thrive.

About the Authors

Emily Shaffer, PhD, is a social psychologist whose research has focused on reducing disparities in education and career fields that arise from negative stereotypes about women and people from underrepresented racial and ethnic groups. At Catalyst, Emily leads the Inclusive Workplace Cultures research stream and is passionate about using her expertise in stereotyping and prejudice to help create more inclusive and equitable workplaces.

Brittany Torrez, PhD, is currently a Senior Manager of Diversity, Equity, & Inclusion at Yelp. She conducted this work as a research fellow on the Inclusive Workplace Cultures research stream, where her work focused on the organizational-level factors that contribute to cultivating an environment where all employees feel included. Brittany earned her PhD in Management from the Yale School of Management.

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Methodology

Recruitment and Sample: Participants in this survey were recruited through an online panel service company. See Demographics chart for more information about the sample. Race and/or ethnicity data was available for participants in Australia, Canada, the United States, and the United Kingdom. As a result, information related to race and/or ethnicity reflects a subset of the sample.

Analysis: We employed several statistical analyses to investigate the impact of participants’ perceptions of diversity rationales on employee outcomes. We conducted linear regression, one-way ANOVA, and logistic regression. All analyses were performed in IBM SPSS version 25.

Demographics

Age Gender Race/Ethnicity Sexual Orientation
38
Average age  
50%
Men
50%
White
15%
Identify as lesbian, gay, bisexual, queer, pansexual, or asexual
18-75
Age range
49%
Women
50%
Marginalized racial or ethnic group
85%
Do not identify as lesbian, gay, bisexual, queer, pansexual, or asexual
  1%
Trans or nonbinary

 

 

Ability Job Level Organization Type Country
11%
Have a disability
27%
Non-management level or individual contributor
49%
For profit
15%
United Kingdom
89%
Do not have a disability
28%
First-level management
21%
Professional service
15%
United States
  24%
Second-level management
12%
Government
9%
Australia
  15%
Senior-level management
11%
Education
9%
Canada
  6%
C-level executive
6%
Nonprofit
9%
France
  9%
Germany
  9%
India
  9%
Mexico
  6%
Netherlands
  6%
Singapore
  6%
Sweden

Acknowledgments

We thank our Leading for Equity and Inclusion donors for their generous support of our work in this area.

Lead Donor
Pfizer logo
Major Donors
Accenture LogoMcDonald's logo

Partner Donors
The Coca-Cola Company
Dell Technologies
KeyBank
Kimberly-Clark Corporation
KKR
KPMG LLP
RTX

Supporter Donors
Edward Jones
Pitney Bowes Inc.

How to Cite: Shaffer, E. & Torrez, B. (2024). How to talk about diversity with employees to achieve your company’s objectives. Catalyst.

Endnotes

  1. Murray, C. (2023, June 7). Anti-‘woke’ goes global—International businesses draw right-wing anger over LGBTQ pride campaigns. Forbes.
  2. Warren, M. (2023, March 20). Many companies are backtracking on their diversity, inclusion, and belonging programs. Here’s why that’s a mistake. Entrepreneur Media.
  3. Howe, A. (2023, June 29). Supreme Court strikes down affirmative action programs in college admissions. SCOTUSblog; Totenberg, N. (2023, June 29). Supreme Court reverses affirmative action, gutting race-conscious admissions. NPR.
  4. Diaz, J. (2023, May 15). Florida Gov. Ron DeSantis signs a bill banning DEI initiatives in public colleges. NPR.
  5. Ely, R. J. & Thomas, D. A. (2020, November-December). Getting serious about diversity: Enough already with the business case. Harvard Business Review.
  6. Georgeac, O. & Rattan, A. (2022, June 15). Stop making the business case for diversity. Harvard Business Review.
  7. Keeping DEI Strong in Volatile Times. (2023). Seramount.
  8. To examine the associations between the fairness rationale and the business rationale with inclusion, we conducted a linear regression. The measure of inclusion (α = .71) is an average of five subscales: authentic, valued, trusted, psychological safety: risk-taking, and psychological safety: latitude. Respondents had the option of answering on a 1 (never) to 5 (always) scale for each question. Both the fairness rationale (α = .87) and business rationale (α = .84) were entered into the model. Respondents could answer each question on a 1 (never) to 5 (always) scale. The model was significant, R2 = .25, F(2, 6797) = 1149.84, p < .001. The fairness rationale was a significant predictor of inclusion, b = .23, t(6797) = 19.82, p < .001, as was the business rationale, b = .12, t(6797) = 9.90, p < .001. The standardized beta associated with the fairness case (B = .35) is twice as large as the standardized beta associated with the business case (B = .18).
  9. To examine the associations between the fairness rationale and the business rationale with diversity climate perceptions, we conducted a linear regression. Diversity climate perceptions were measured by six items (α = .76) on a 1 (strongly disagree) to 6 (strongly agree) scale. Both the fairness rationale and business rationale were entered into the model. The model was significant, R2 = .11, F(2, 6797) = 421.15, p < .001. The fairness rationale was a significant predictor of diversity climate, b = .37, t(6797) = 17.11, p < .001, but the business rationale was not, b = .002, t(6797) = 0.10, p = .920; Mor Barak, M. E., Cherin, D. A., & Berkman, S. (1998). Organizational and personal dimensions in diversity climate: Ethnic and gender differences in employee perceptions. The Journal of Applied Behavioral Science, 34(1), 82-104.
  10. To examine the associations between the fairness rationale and the business rationale with turnover intentions, we conducted a linear regression. Intent to stay was measured by two items (r = .73): “How often do you think about leaving your current job?“ on a 1 (never) to 5 (always) scale and ”Within the next year, how likely are you to leave your current job?” on a 1 (very unlikely) to 5 (very likely) scale (both reverse-scored). Both the fairness rationale and business rationale were entered into the model. The model was significant, R2 = .01, F(2, 6797) = 34.31, p < .001. The fairness rationale was a significant and positive predictor of intentions to stay, b = .22, t(6797) = 7.93, p < .001, whereas the business rationale was a significant and negative predictor of intentions to stay, b = -.14, t(6797) = -4.98, p = < .001.
  11. O’Connell, M. & Kung, M. C. (2007). The cost of employee turnover. Industrial Management, 49(1), 14-19.
  12. Brecheisen, J. (2023, March 9). Research: Where employees think companies’ DEIB efforts are failing. Harvard Business Review.
  13. McGlauflin, P. & Abrams, J. (2023, July 31). Companies are ‘diversity ditching,’ which could have long-term consequences on employee retention. Fortune; Miller, J. (2021, February 18). For younger job seekers, diversity and inclusion in the workplace aren’t a preference. They’re a requirement. The Washington Post; Minkin, R. (2023, May 17). Diversity, equity, and inclusion in the workplace. Pew Research Center.
  14. Georgeac, O. A. & Rattan, A. (2022). The business case for diversity backfires: Detrimental effects of organizations’ instrumental diversity rhetoric for underrepresented group members’ sense of belonging. Journal of Personality and Social Psychology. 124(1), 69-108.
  15. Trawalter, S., Driskell, S., & Davidson, M. N. (2016). What is good isn’t always fair: On the unintended effects of framing diversity as good. Analyses of Social Issues and Public Policy, 16(1), 69-99.
  16. Ely & Thomas (2020).
  17. Emotional Tax Research Series. (2016-2022). Catalyst.
  18. A logistic regression was conducted to examine how the fairness case and business case shapes the feeling of being on guard due to a person’s gender in the workplace for employees who identify as women. The logistic regression was statistically significant: X2 (2) = 75.36, p < .001, Nagelkerke R Square = 0.04. When employees report that their organization uses the business case, they are 2.14 times as likely to report feeling on guard, b = 0.76, Exp(B) = 2.14, p < .001, but we did not find a significant effect between the fairness case and feeling on guard, b = 0.03, Exp(B) = 1.03, p = .779.
  19. A logistic regression was conducted to examine how the fairness case and business case shapes the feeling of being on guard due to a person’s race or ethnicity in the workplace for employees who did not identify as White. The logistic regression was statistically significant: X2 (2) = 11.68, p < .01, Nagelkerke R Square = 0.012. When employees report that their organization uses the business case, they are 1.7 times as likely to report feeling on guard, b = 0.51, Exp(B) = 1.66, p < .01, but we did not find a significant effect between the fairness case and feeling on guard, b = -0.15, Exp(B) = 0.86, p = .366.
  20. A logistic regression was conducted to examine how the fairness case and business case shapes the feeling of being on guard due to a person’s sexual orientation in the workplace for employees who did not identify as straight. The logistic regression was statistically significant: X2 (2) = 33.40, p < .001, Nagelkerke R Square = 0.05. When employees report that their organization uses the business case, they are 1.9 times as likely to report feeling on guard, b = 0.64, Exp(B) = 1.89, p < .001, but we did not find a significant effect between the fairness case and feeling on guard, b = 0.28, Exp(B) = 1.33, p = .132.
  21. A logistic regression was conducted to examine how the fairness case and business case shapes the feeling of being on guard due to a person’s disability status in the workplace for employees who identified as having a disability. The logistic regression was statistically significant: X2 (2) = 25.82, p <.001, Nagelkerke R Square = 0.05. When employees report that their organization uses the business case, they are 2.26 times as likely to report feeling on guard, b = 0.82, Exp(B) = 2.26, p < .001, but we did not find a significant effect between the fairness case and feeling on guard, b = 0.03, Exp(B) = 1.03, p = .869.
  22. Brassel, S., Shaffer, E., & Travis, D. J. (2022). Emotional tax and work teams: A view from 5 countries. Catalyst.
  23. Total does not sum to 100 due to rounding.
  24. A dichotomized variable was created to represent the relative use of a fairness case versus a business case. First, scores on the business rationale scale were subtracted from scores on the fairness rationale scale to create an overall difference score where scores greater than zero represented cases where the fairness case was employed more than the business case. Scores lower than zero represented cases where the business case was employed more than the fairness case. This difference score was then recoded into a dummy variable where “1” represented cases where the fairness case was employed more than the business case and “0” represented cases where the business case was employed more than the fairness case. We then used a between subjects ANOVA to examine the effect of using a fairness case over a business case (versus a business case over a fairness case) on experiences of inclusion. The main effect of this variable was significant, F(1, 5294) = 36.13, p < .001, such that employees who said their organization used a fairness case more than a business case reported greater inclusion (M = 3.68) than did those who said their organization used a business case more than a fairness case (M = 3.59).
  25. A between subjects ANOVA was used to examine the effect of using a fairness case over a business case (versus a business case over a fairness case) on perceptions of the diversity climate. The main effect of this variable was significant, F(1, 5294) = 69.32, p < .001, such that employees who said their organization used a fairness case more than a business case perceived a more positive diversity climate (M = 4.32) than did those who said their organization used a business case more than a fairness case (M = 4.10).
  26. A between subjects ANOVA was used to examine the effect of using a fairness case over a business case (versus a business case over a fairness case) on intentions to stay in the organization. The main effect of this variable was significant, F(1, 5294) = 36.26, p < .001, such that employees who said their organization used a fairness case more than a business case were more likely to intend to stay at their organization (M = 3.47) than those who said their organization used a business case more than a fairness case (M = 3.27).
  27. Hatami, H., Maor, D., & Simon, P. (2023, June 15). All change: The new era of perpetual organizational upheaval. McKinsey.