In the era of H&M Monkey-gate, Gucci’s Blackface Catastrophe and Burberry’s Noose “Incident”— it is clear that corporations require a thorough diversity and inclusion strategy. But when companies make such egregious missteps, the question that looms in the minds of consumers and corporations alike is how did this happen?
Retailers, in particular, have a distinct set of D&I considerations that span leadership, company culture, and consumer touchpoints. Each of these forces play a role in ensuring that the business is not only set up for growth, but that it is also shielded from reputation mishaps.
Understanding the D&I mandate
Building diversity in the workplace has become a business imperative. Shoppers are voting with their dollars, turning away from retailers that do not share their values and towards those that do. Twenty-nine percent of shoppers are more likely to choose a brand that reflects the importance they place on D&I. This jumps significantly for millennials and Gen Z.
So, what should retailers be considering as the look to build diverse workplace?
Firstly, leaders must understand why diversity and inclusion are important and continuously work to educate every employee on these benefits.
“Achieving inclusive diversity in a fully integrated way will continue to be a driving principle for us. Inclusion is how we can tap into the full potential of our associates. Properly leveraged, it can be our true competitive advantage. It’s a central part of our business strategy that will allow us to grow and ultimately win in the market,” James Quincey, CEO and Chairman of The Coca Cola Company.
Representation for retention
According to data from research firm Catalyst and the Hispanic Association on Corporate Responsibility, women make up 45% of the S&P 500 workforce but hold a mere 5.2 percent of CEO positions. While Black and Latinos account for fewer than 4% of executive positions.
Although a tricky “chicken or the egg” concept, leadership diversity is a powerful signal to employees that there is a place for growth and advancement in the organization. Therefore, organizations should continue efforts to increase the pipeline of diverse candidates into leadership positions.
We’ve seen retailers start to do this with various D&I tactics, such as Macy’s Mosaic leadership program for a “selected group of top-talent” managers and directors of African American, Hispanic-Latinx, Native American and Asian descent. The year-long development program for minority employees will be an important tactic for the retailer to reach their goal of 30 percent ethnic representation at its senior director level and above.
D&I ingrained in culture
Often when there is consumer backlash to a D&I misstep, organizations hurry to hire a Chief Diversity Officer. We’ve seen this with H&M when Ezinne Kwubiri was brought into a newly created position of Head of Inclusion & Diversity for North America, as well as when Gucci recently hired Renée Tirado as first Global Head of Diversity, Equity and Inclusion.
There is no denying the significance of these positions. However, it’s also important that organizations do not solely rely on chief diversity officers to champion D&I strategies. Diversity needs to permeate the culture, infused in everything from hiring practices, supplier diversity, training and development, and leadership opportunities.
Diversity is a core value for Target. Likely because of how deeply ingrained diversity is in its culture, Target has met its diversity and inclusion goals for three years running. But as Target’s Chief Culture Diversity and Inclusion Officer Caroline Wanga mentioned in the retailer’s Annual Fall National Conference, “Our work will never be done… In order to deliver moments that matter to guests, our team must all listen courageously, get comfortable being uncomfortable and honor our truths.”
People of color make up 1/3 of the US population and will make up the majority by 2042. And today, almost half of Gen Z are non-Hispanic white, making it the most racially and ethnically diverse generation in US history. The ever-diversifying landscape of America obliges retailers to reflect and understand the diversity present in shoppers and employees.
The more an employee can empathize with a consumer group, the more that employee is able to consider that group’s perspective throughout the consumer journey. This doesn’t mean that every corporate meeting has a member of each ethnic and racial group represented, but instead that every employee has a strong cultural competence.
Organizations need to provide their workforce with learning and development opportunities within and outside the organization so employees gain a broader knowledge base on the issues that affect their guests. This shifts the onus of D&I from only the D&I leaders or multicultural teams to every employee in the organization. The effect will be seen within merchandise, marketing, employee retention and more.
One can point to multiple reasons why retailers like H&M, Gucci and Burberry have stumbled in recent years. However, the more that D&I is incorporated into every facet of an organization, the better a retailer’s chances of not becoming yet another cautionary tale. And the result of dedicated D&I efforts will not only save you a PR nightmare, but it’ll also help your bottom line. What’s not to love about diversity and inclusion?!