New research from Baker McKenzie reveals a frustrating lack of progress on Inclusion & Diversity (I&D) within leading global companies, despite efforts to address underrepresentation and promote inclusion. The report contains insights from 900 Global Employment Leaders surveyed in global organizations, including representatives from Australia.

Despite strenuous efforts to address underrepresentation — in particular of women and other members of underrepresented groups — and to promote inclusion, progress is slow and sometimes frustrating. Many organizations are less far along the path than they hoped and continue to work on long-held priorities such as raising awareness of I&D, recruitment and retention of diverse talent and increasing the diversity of senior management (which in many organizations remains predominantly white and male). Furthermore, employees with disabilities remain heavily underrepresented in the workforce as a whole.

When expressed as a percentage of company turnover, it is noteworthy that organizations in Australia are making the greatest investment in I&D, and those in the UK the least. Overall, I&D investment represents only a small fraction of organizational turnover and real cut through is still to be seen.

The I&D issue that organizations are the most concerned about is underreporting of discrimination, harassment and I&D related challenges.

Head of Baker McKenzie’s Asia Pacific Employment & Compensation Group, Michael Michalandos, based in Sydney, stated: "Underreporting is likely to stem from conflict avoidance among managers rather than a lack of reporting infrastructure at the organizational level. This is a trend we see in relation to anti-bribery, corruption, and poor employee conduct and performance as well as I&D. An over-emphasis on mateship and keeping the peace makes it very difficult to manage compliance issues generally.

Managers are particularly uncomfortable in dealing with sensitive discrimination and harassment issues and regularly attempt to deal with these issues informally, often downplaying the matter and not consulting properly with the complainant. A common theme is that the complainants feel ignored or frozen out of the process. This only serves to compound the issue. Other employees who have been subjected to bad behavior quickly form the perception that their matters won't be dealt with seriously, or even worse, that will be disadvantaged for raising the issue.”

In fact, 43% of Australian respondents are in agreement regarding underreporting of discrimination, harassment, and I&D related challenges.

Diversity leaders need to fully understand the challenges that are hindering their existing I&D efforts in order to focus programs on what creates a truly inclusive workforce. Michael Michalandos stated: "Although general I&D training and policies are important to help organizations keep pace, there needs to be a specific focus on encouraging managers to proactively intervene and giving them the skills and confidence to manage these issues at the coal face. This includes regularly and sensitively consulting with complainants."

A critical piece is also strong leadership on I&D at the board and executive level, starting with role model behavior. Michalandos says - "Organizations have shown how important strong messaging from the Board can drive effective work health and safety practices. I&D should also be a regular item on Board agendas. Leaving aside the ethical reasons for driving I&D initiatives and its importance in fostering innovation, a failure to give this area priority has shown a remarkable capacity to destroy reputations and business. More and more, the public are holding accountable organizations with poor I&D records."

To view the full report, visit here.

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