Diversity and inclusion (D&I) is not just a priority among consumer packaged goods (CPG) companies to attract and retain the best talent—it’s become an essential part of an organization’s hiring strategy and has become a fundamental pillar of any successful business. Now more than ever, D&I is the predominant subject matter of conversation among employers.
Not only are global CPG companies talking about D&I—especially when they’re looking to invest in high growth CPG companies—but private equity firms are also eager to add companies with diverse leadership teams to their portfolios.
Recently, we’ve seen more female-led private equity firms emerge. And we’re seeing private equity firms invest exclusively in female-led companies. We’ve also observed an increased trend among employers to offer D&I training to their employees. D&I is no longer an afterthought on an executive search call—it’s often one of the first things that’s discussed.
D&I Starts with Intention and Awareness
It’s important to remember that everyone brings unique experiences and different backgrounds to the workplace. Workers also bring unconscious biases that can influence workplace productivity. For companies to become more diverse and inclusive, they must first change how they approach thinking about their teams and hiring strategies. D&I starts with intention and awareness.
Companies that invest in this awareness and lead D&I efforts with intention and awareness will be better equipped to create a workforce that reflects the diversity of its consumer base. In the CPG space, much of consumer spending is driven by women, especially by mothers, who control 85% of household purchases and have a spending power worth $2.4 trillion. And yet, even with this incredible buying power, female leaders remain underrepresented in the CPG space.
According to the Network for Executive Women, women occupy less than 30% of leadership roles and only 13% of C-suite executive roles, which is the lowest of any industry. Companies that are conscious and intentional of the changes their teams need to make to better reflect their consumers will be able to execute effective hiring and recruiting practices that will ultimately grow their businesses.
D&I Best Practices
Companies can become more diverse and inclusive by taking several initiatives that include evaluation, education, mentorship programs, networking opportunities, and more. Employers should recognize where the opportunities are for D&I by first evaluating their teams at all levels.
It’s not just junior- to mid-level management that needs to change—D&I must encompass boards of directors and executive leaders, too. Companies must identify current practices and suggest tools that can be implemented to help the industry improve.
We’ve seen a trend among leaders in CPG companies implementing programs like nonprofit committees to help promote more D&I within the industry. Mentorship programs are also particularly important for fostering this conversation. I’ve observed C-suite groups dedicated to connecting mid-level female finance professionals to leaders who can provide real career guidance and mentorship.
Companies can take several steps both internally and externally to make significant improvements around D&I. Internally, employers can offer D&I training that educates employees on unconscious biases and help promote company awareness. One great resource we’ve leveraged is Project Implicit, a long-term research project based at Harvard University that aims to measure people’s preferences for certain social groups over others.
Externally, companies can participate in networking opportunities that highlight workplace diversity and collaboration. Whether D&I initiatives are internal or external, companies that are active participants in the conversation will enhance their overall brand, which becomes vital for talent acquisition.
D&I as a Competitive Advantage
Employer branding is one of the ways companies can showcase their D&I efforts to attract top talent in today’s candidate-driven job market. According to ForceBrands’ 2019 Talent Market Report, an extensive in-depth analysis of cross-industry hiring trends, 76% of survey respondents felt employer branding was either very or extremely important for employee recruitment and retention.
Companies that weave their D&I efforts into their brand narrative will benefit not just from a more innovative team which brings different ideas to the business, but they will also reap financial benefits. Research from McKinsey & Company reveals that companies with more diverse workforces perform better financially. The correlation between a company’s financial performance and its ethnic, cultural, and gender diversity proves that D&I efforts pay off.
CPG companies that truly promote D&I will not only add valuable new perspectives to their teams, but they will connect with their full consumer base, boost overall productivity, attract top candidates from different backgrounds, and ultimately be more successful. And while there are countless benefits to more diverse and inclusive organizations, it’s important to remember that the conversation around D&I is just getting started.
|Sean Conner is Cofounder and Chief Progress Officer of ForceBrands, the leading specialized recruiting firm for the consumer products industry.|