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D&I metrics: How to measure diversity in the workplace

It's not enough to just track the number of diverse employees you have. Here's how to meaningfully track diversity and inclusion (D&I) in your workplace.
Published 8 Jun 2022
Updated 3 Jul 2024
9min read
Two women of different ethnicities sitting together at an office window chatting

Building a diverse and inclusive workplace has been an important topic in the world of work in recent years and that’s not changing anytime soon. If businesses want to embrace inclusivity and truly walk the talk, it’s time to look at the data.

Inclusivity benefits everyone – it benefits employees, it can lead to greater visibility of communities and it benefits companies too. If companies want to attract and retain talent, their level of inclusivity is an increasingly important factor. Gen Z, a growing percentage of the workforce, particularly values it in finding a new employer, and in staying with one. In fact, 36% name an inclusive culture as their deciding factor for joining a company.

So, how would you rate your company on its inclusiveness? The chances are, even if you’d rate it ten out of ten, there’s probably a lot you’ve missed. The key to digging deeper and truly making a difference is in measuring diversity and inclusion metrics.

What are diversity and inclusion metrics?

First, let’s consider what diversity and inclusion look like in practice. Diversity is defined as the characteristics or traits of an individual. However, inclusion is how welcoming and safe an environment is for all.

We can often identify diversity in an environment, but inclusion is far more challenging to identify. To understand how inclusive a workplace is, it requires careful monitoring and conversations. For a company to build an inclusive culture, they need to be open to change. Importantly, they need to listen – both to what their people tell them and what the wider data explains about their progress.

The two terms work together. When a workplace recognises and celebrates diversity, that can lead to an inclusive culture. Yet in a world of inequality, it sadly does take work to build that strong culture. That needs work from you – the people and culture leaders.

How do you measure diversity metrics?

If a company is to make a difference in their workplace and take steps towards building an inclusive culture, they have to have the data to hand. While there’s steps that go towards building advocacy on the ground, such as in promoting inclusive language and implementing anti-discrimination policies, there’s no way to make lasting change without knowing where your company is starting and how it’s progressing.

That’s where diversity metrics come in.

The issues at hand

Although many companies see themselves as welcoming and open, research has shown us that even now, there’s a long way to go. For example, in New Zealand, slightly over 20% of Māori and Pasifika employees and 15% of Muslim employees have reported a moderate level of racism at work, and just under 5% of all employees have noted a high level of racism in their employment.

Meanwhile, in the LeanIn Women in the Workplace study in 2020, 73% of the women surveyed reported that they face daily discrimination at work. People with disabilities have a much higher rate of unemployment than non-disabled people, often due to presumptions about their capabilities. For the LGBTIQA+ community, a Williams Institute survey reported that a staggering 38% of the LGBTIQA+ employees they spoke to had experienced harassment at work.

It’s a lot. And it’s not going to go away without some serious change.

Digging into the data

DEI metrics are not as simple as lines on a graph or numbers in a table. They range from clear metrics on hiring demographics, to more complex employee data like pay rates and employee satisfaction. When put through the lens of diversity, some of these metrics might not illuminate any issues upfront. They often require an multiple layers of investigation under the data.

For example, a significant lack of diversity in hires across one department may indicate conscious (or unconscious) discriminatory hiring practices by individuals, rather than across the company. A lack of minority representation in leadership might reflect an unwelcome culture or bias by those making the decisions, rather than a questionable meritocracy.

A lot of bias hides in plain sight as well. Unconscious bias makes a huge difference to how minorities are affected in the workplace, and it’s not as easy as pinpointing office bullying or outright discrimination. As the name suggests, unconscious bias isn’t a deliberate act, but one where ingrained prejudices affect perceptions and actions. That’s where taking that top level data and investigating further is so important to measure what’s really happening.

What are the common diversity metrics used?

1. Hiring metrics

Monitoring hiring metrics as a way to track inclusivity is crucial, as the hiring process decides who makes up your company. If your company doesn’t have diverse talent and is monolithic in its thinking, it’s got a very, very long way to go before it can ever be deemed close to an inclusive workforce.

Your hiring metrics should capture a number of levels of the hiring process. For example, keep a close eye on the job applicants who make it through the rounds, as well as the ones who don’t. Check in on who’s applying and consider how your approach might privilege certain groups over others. An applicant tracking system (ATS) is really useful for tracking this metric, as it will give you that end-to-end perspective without trailing through email chains.

Once you have that insight, it’s time to look at how you can improve. One good way is to ensure that the HR team have a standardised approach to their hiring process, with clear guidelines for an inclusive process. You can also consider where you’re advertising and the accessibility of the interview and offer process.

2. Promotion and advancement metrics

Consider how your promotion and advancement metrics across the company tracks with your metrics in the diversity of the workforce. If you’re seeing a correlation, you could be identifying a bias, or perhaps even an issue in the company culture which is stifling the promotion opportunities of those in minority groups.

Once you have that information, it’s time to see what you can do to improve the data, whether that’s supporting more women towards leadership roles or facilitating training to combat unconscious bias.

3. Retention rates

Retention rates are fairly straightforward to track providing you keep records of new hires versus exiting employees. Now, add a DEI lens onto that data and you’ve got a key diversity metric that will allow you to see if different groups are under or overrepresented, whether that’s in the employees that are sticking around for the long haul or the ones who are leaving for new roles. If there’s an imbalance there, it’s time to look into why and assess your turnover rate.

4. Pay rates

Tracking pay rates for HR teams is fairly routine, but with pressures around issues such as the gender pay gap (and the added pay gaps experienced by women of colour in comparison to white women), it’s important that it’s more than just a simple graph. Pay rates should be examined carefully. If it looks like bias or discrimination is playing a part, the next step is to consider how pay rates are decided and assessed.

5. Employee happiness

Measuring employee happiness is an important metric by any standards, but it’s useful in assessing inclusivity as well. A diverse workforce of employees who feel included and comfortable in their workplace are naturally happier, so high employee satisfaction can be a good indicator that you’re on the right track. Sending out snapshot employee engagement surveys can also be a handy way of gauging your progress – so for example, following the implementation of a large scale inclusivity initiative.

6. Supplier diversity

This metric is often overlooked but it can make quite a significant difference, both for your reputation and for your operations. Consider who the company works with, whether that’s equipment suppliers, guest speakers or agencies. Think outside the box (and price tag) and include in your assessment whether they are showing an inclusive ethos, or are perhaps underrepresented and undervalued. Bringing in a fresh perspective could really benefit how your company operates too.

7. Employee resource group (ERG) participation

Does your company have employee resource groups (ERGs)? ERGs are meant to advocate for employers and give them a seat at the decision-making table. If you do have them in place, you should be monitoring their diversity and ensuring that voices across the company are being heard. Additionally, if one group is being heard more than the others, it’s important to check in with those metrics and ensure that’s not due to bias.

8. Accessibility scores

Accessibility is one of those considerations that companies absolutely cannot forget, but at the same time due to a lack of representation or understanding, they often don’t fully consider. HR teams should regularly score themselves on accessibility for their working environments, both online and offline. That could include enabling the use of screen readers, an accessible bathroom for people who use a wheelchair or a space for breastfeeding mothers. It’s also where consultation comes in really handy – chances are, if you open the company up to feedback on accessibility, you’ll find out exactly where you need to improve.

We all know the benefits of remote work, but one benefit that’s often overlooked is just how much it improves accessibility. It empowers women returning from maternity leave, and gives men the flexibility to support their partners during this time. It can help carers and people with a disability stay employed, and redistribute wealth away from metropolitan areas and into regional and rural centres. Put simply, remote work encourages a workplace culture that is inclusive. 

How to pick the right DEI metrics (diversity, equity and inclusion) for your company

Diversity metrics aren’t always a one-size-fits-all. A lot of it will depend on the size of the company or the rate of recruitment. A small company won’t necessarily see frequent promotions, for example.

However, the key to picking the right diversity metrics is to choose ones that you can measure well, and measure often. For many medium-sized companies, most of the metrics listed above are certainly ones that they could monitor.

Bring the right people on board

It’s important to have the resources and the support. For HR teams, you’ll need to ensure that the leadership team is on board and engaged with the push for inclusivity. After all, some resulting initiatives might see the leadership team themselves go through change for the better. If they’re hesitant, there’s plenty of statistics which show how a more inclusive workplace can benefit the company in a number of ways, including their bottom line.

Measure, report, rinse, repeat

Once you’ve got support from leadership, it’s all about gathering those metrics and monitoring them. A lot of the metrics mentioned above can be captured in a HR reporting software like Employment Hero. The EH platform can regularly generate detailed, top-down reports on metrics company-wide. When you’ve got software doing the data gathering for you, that gives you more time to focus on the results, as well as bring in initiatives to improve on them.

Are inclusion initiatives and inclusion efforts measurable?

Inclusion initiatives aren’t necessarily measurable in the same way that diversity metrics are, but they’re an important part of the overall push for inclusivity. They can also work in tandem with diversity metrics, in that they can be used to address any issues that are revealed in the data collected.

If the metrics show that certain minority groups are being consistently passed over for a promotion, that’s a big issue. While it’s important to first investigate why that might be, there are some initiatives that can push everyone’s work to the fore equally and encourage the recognition they deserve.

For example, here at Employment Hero we’ve got a feedback channel which is visible to the whole company. There, employees of any level in the company can share and congratulate the colleagues doing top work, and bring attention to what they’re doing. It means you’ve also got concrete records of their achievements.

Another actionable initiative is mandatory anti-discrimination policies, which promote a no-tolerance approach to racism and discrimination in the workplace. These can add an extra layer of security and encourage some confidence in the reporting of discriminatory behaviour in the workplace. To save time, you can invest in Employment Hero’s pre-written policies that can be rolled out across the entire company, so you know you’ve made your message clear.

While these kinds of actions can’t be measured with simple data, their effects will still be felt across the company – especially when combined with the insights garnered from diversity metrics.

The wrap-up

In the end, creating and fostering an inclusive company culture is rewarding work. Sometimes it might be challenging and bring up some uncomfortable truths, but it’s work that needs to be done to keep your team, and the company, thriving.

If you bring in those metrics, there will also be a better understanding of the company and the value that a diverse teams brings. With monitoring, initiatives and some positive steps forward, you’ll be looking at a brighter and more inclusive future where your diversity efforts will be supported across the entire business.

Find out more about building a strong DEI strategy in your organisation


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