It’s been long known that diverse and inclusive teams perform better (one global McKinsey study suggests as much as 15% – 35% higher than average), yet minority groups are still significantly underrepresented in the tech industry. We at IGNIA care deeply about building the best companies with the greatest potential of success and we know that building diverse teams and ecosystems is an essential part of that goal.
We’re always eager to have this conversation, so please reach out. But first….
- Diversity describes the range of human differences within a group of people. Typically, our differences can be grouped into three broad categories: Demographic (age, race, gender identity, sexual orientation, physical resources), Experiential (economic or social position, education, occupation, faith, abilities, dependents, caring responsibilities), and Cognitive (how we approach problems and think about things)
- Inclusion is the act of making someone feel part of a group. An inclusive environment allows individual contribution to matter and employees are able to perform to their full potential, no matter their background, identity or circumstances.
Why Should I Care?
- In Mexico, McKinsey has found that companies with a greater number of women on their executive committees have an economic value added 28% higher, a profit margin 55% greater, and a return on equity 47% larger than companies with a lower female representation. And yet, women are underrepresented at every level (women make up 10% of C-Suites, they are paid 8-22% less depending on seniority, and they are up to 88x less likely to be promoted at senior levels).
- Catalyst’s compilation of research linking diversity to financial performance shows positive impact on accounting returns, cash flow return on investment, EBIT margins, gross and net margins, market value, return on assets, return on equity, revenue, sales growth, share price, and others.
- Globally, McKinsey has found that companies in the top quartile for gender diversity on executive teams were 21% (33% for ethnic diversity) more likely to experience above-average profitability than the bottom quartile.
- In the US, Kauffman Fellows Research Center found that female and minority founders have a harder time raising initial capital, but they are more likely to be successful raising future rounds. Ethnically diverse founding teams have a 30x higher multiple at acquisition or IPO.
- Catalyst has collected comprehensive research showing that diverse companies better retain talent, improve employee engagement and satisfaction, maximize productivity, innovate more, have stronger brands, have less instances of fraud, and outperform across financial metrics.
- A Credit Suisse analysis of over 3,000 companies shows significantly greater return on equity, valuations, and dividend payments for companies that have greater representation of women on executive leadership (of over 15%) and boards.
Looking to Get Started Yourself?
We think this practical guide to Diversity & Inclusion in tech by Diversity VC and Atomico is a great place to start. It has explanations of why diversity matters, case studies, and a clear roadmap to build a D&I strategy that works for your business (including diverse and inclusive hiring, creating an inclusive workplace, and creating inclusive products and services). We encourage you to download and read the entire report.
As you continue on this journey, Project Include has recommendations for every facet of your talent management system (e.g. its guide to writing your code of conduct). Google has shared some practical guides and tools for how they reduce bias in the workplace.
Lastly, this article by the founder of Aleria (below) gives a comprehensive description of how you can measure inclusion.
Quick & Easy Slack Integrations
If you’re looking for an easy win to implement immediately, check out the below Slack integrations.
- Crescendo is a Slackbot that provides actionable tips and curated learning paths around culture, diversity and inclusion. It generates data around behavior change which can help shape company culture.
- AllieBot is a Slackbot that provides mechanisms for real-time feedback, weekly pulse surveys on inclusion, curated content, and microtraining to level-up your team’s knowledge.
Looking to Talk to Someone?
- Here are some recruiters that specialize in matching top female talent & board members (in no particular order)
- Spencer Stuart – Jose Maria Urquiza
- Korn Ferry – Carla Ormsbee
- Women Corporate Directors – Magdalena Carral Cuevas
- Heidrick & Struggles – Manuel Gomez Uriarte
- Talent on Demand – Monica French
- Claudia Hardy (independent head hunter)
- Colegio Nacional de Consejeros Profesionales Independientes de Empresas AC (CNCPIE) – Grisel Elizondo Villalobos
- Laboratoria (source of coding talent)
- Aleria will perform an Inclusion Assessment to help you understand how inclusion can be measured in your business, how it impacts your KPIs (employee satisfaction and retention, business performance metrics, etc.), and how you can move forward. Here is their (pretty comprehensive) D&I Toolkit for Entrepreneurs.
- Holistic Index can help you work towards a diverse, inclusive, and vibrant workplace with a comprehensive data-driven snapshot of your employee engagement, benefits, pay equity, and diversity & inclusion.
- The Venture Inclusion Network has a list of service providers, and Diversity VC has a list of tech tools that can help you improve inclusion in your workplace.
Sample Legal & Policy Documents
- Anti-Harassment Policy Template for Startups, by Greylock Partners.
- Sample H.R. Policies for Addressing Harassment & Discrimination, by National Venture Capital Association (NVCA).
- Sample H.R. Policies for Attracting & Retaining Diverse Talent, by NVCA.
- Sample Diversity & Inclusion Policies – SF Family Friendly Workplace Policy, by NVCA.
- Sample Diversity Policies – NY Paid Family Leave Policy, by NVCA.
- Sample Diversity & Inclusion Policies – SF Paid Parental Leave Policy, by NVCA.
You can check the diversity policy of any investor at #wearemovingforward on GitHub. Don’t forget to hold us accountable as well!
Other Readings & Resources
- SASB Materiality Map, by SASB for ESG accounting
- Diversity & Inclusion in the Mexican PE/VC Sector In Mexico, by AMEXCAP
- Diversity Toolkit, by AMEXCAP
- How VC Bias in Viewing Pitch Decks Can Affect Fundraising Success, by Nick Frost
- The Other Diversity Dividend, by Paul Gompers and Silpa Kovvali
- Lessons in Inclusive Hiring, by Stacy-Marie Ishmael.
- How to Hire Female Engineers, by Sharon Wienbar.
- Two Types of Diversity Training That Really Work, by Harvard Business Review.
- Managing Unconscious Bias Primer, by Facebook.
- Can I pick your brain about diversity?, by Aubrey Blanche, Global Head of Diversity and Belonging at Atlassian.
- Material to get started with diversity & inclusion at your company, by Rahul – UX & Diversity, Equity, and Inclusion and Google.
- Five Things Tech Companies Can Do Better, by Sharon Fowler.
- Harassment in the Workplace — policies or dialogue — where do we start? by Vani Kola.
- State of the Science: Implicit Bias, by Ohio State University.