The concept of DEI isn’t anything new. The acronym (which stands for diversity, equity and inclusion) has been floating around for years. Workplace diversity training initiatives really picked up in the 1960s when legislation around equal employment and affirmative action went into effect. Diversity in the workplace has improved since then, but the protests for racial justice throughout 2020 initiated a huge wake up call for many companies. As a result, more companies made DEI a high priority.
“In the last year, companies have heightened their focus on diversity, equity and inclusion initiatives,” said Bill Gianoukos, CEO of Boston area-based healthtech company Goodpath. “This year, we will see companies continue to build on these programs and lean more heavily into benefits that support all workers.”
Built In conducted a survey of 223 companies and employees to check in on the diversity initiatives within the tech industry. Our State of DEI in Tech 2022 report found that, over the last two years, many companies doubled their commitments to support equity and inclusion in tech.
However, for as many positive statistics we found, there were just as many areas that needed improvement. One in four of the companies we surveyed said their teams were more than 70 percent white and 73 percent of respondents said there were no Black leaders on their executive teams. What’s more, 39 percent of women and BIPOC employees surveyed said their voices and perspectives didn’t feel included in the decision making process at their jobs.
Built In’s State of DEI in Tech 2022: Key Findings
- 40 percent of company leaders plan to report on DEI metrics in 2022.
- 30 percent of employees say their companies have no DEI programs, or are making poor progress toward DEI goals.
- 49 percent of tech companies plan on hosting DEI events in 2022.
- In 2022, 43 percent of companies plan to build a DEI manifesto.
- Only 7 percent of employers gather demographic data about their boards of directors.
There’s a long road ahead to make sure everyone has a chance to succeed in tech. If people leaders truly want to show their employees that they care, DEI has to be front and center, said Mykaela Doane, head of people and talent at Denver-based OKR software company Gtmhub.
“When DEI is strong, people are supported and valued as humans,” said Doane. “They’re empowered to do their best work — free from stress, distraction and harm that results from prejudice, bias, unfair treatment or the feeling that they have to assimilate or hide their true selves in order to be successful.”
Missed Chances
Built In’s research revealed that while plenty of companies strengthened their commitments to DEI over the last few years, there are still several areas leaders can work harder on. Here are a few key opportunities that some companies are missing when it comes to supporting DEI at work.
No Diversity Recruiting Goals
With the Great Resignation in full swing, leaders have to leverage every tool at their disposal in order to attract candidates. When asked about recruiting trends for 2022, Ben Boyd, VP of product and engineering at New York-based cloud computing software company Exotanium, predicts that DEI will need to become central to recruiting strategies if companies want to tackle the current talent shortage.
“I anticipate that the market for technology talent will continue to be hypercompetitive in 2022, and as a result, company cultures and initiatives will have to shift to be more inclusive and welcoming of underrepresented groups in order to fill roles,” he said. “We’ve seen in the last couple of years that employees care deeply about company culture, in that it should reflect their own values and view of what the world should look like.”
This thought about the industry’s future is backed up by some data. According to research from Glassdoor, around 76 percent of candidates named diversity as a key component of their decision making process while looking for a job. However, in Built In’s report, only 42 percent of surveyed companies said that their leadership has set diversity hiring goals. Employees want diverse and inclusive companies, but many organizations haven’t made an effort to build diverse teams — and that is a huge problem.
“I think candidates actually do have the upper hand right now,” said Ivori Johnson, the director of DEIB at New York-based people analytics company ChartHop. “So in order to find talent and get them in the door, you have to be able to show and prove that you are walking the walk when it comes to diversity. Just going to an event or a conference is not enough.”
Homogenous Leadership
The tech industry has a lot of catching up to do when it comes to building diverse teams. Some companies have started picking up the slack — 71 percent of the employers we surveyed say they implemented diversity hiring goals in 2020. But according to Johnson, the issue isn’t just with hiring diverse candidates, but with where those candidates wind up.
“A lot of companies focus on reaching representation goals by hiring people into entry level roles,” said Johnson. “They’ll report out great diversity numbers, but all the representation is at the bottom.”
It’s common knowledge that leadership teams set the tone when it comes to company culture and values. But when it comes to diversity, many C-suite teams fall short. According to our research, around 31 percent of employers said their executive teams were at least 90 percent white and only 7 percent have collected demographic data on their board of directors.
In order for tech to become a more equitable industry, many companies will have to take a good look at their leadership teams and make sure there’s a seat for everyone at the table.
Promising Opportunities
There’s a lot of work left to be done, but HR leaders have tremendous power to affect change both within and outside of their teams. Here are some basic steps that people leaders can take to make their company culture more inclusive, diverse and equitable.
Level Up DEI Reporting
Transparency is a crucial element of DEI work and when companies are open about their metrics, employees take notice. Built In’s survey found that 34 percent of candidates seek companies that report their employee demographics publicly. The value of transparency isn’t lost on leadership — 40 percent of employers from Built In’s survey said they planned to report extensively on their DEI numbers, up from the 20 percent that did similar reporting before 2019.
“This transparency and internal alignment allows for accountability and trust, and opens the door for conversation, powering future initiatives and fueling deeper understanding. Sunlight is the best disinfectant.”
These numbers are also reflected in external data. In September 2021, Just Capital found that over 55 percent of companies report the racial and ethnic makeup of their teams, while in January 2021 that number was only 32 percent.
At Gtmhub, the positive impacts of DEI transparency on workplace culture and employee performance are clear, Doane said. “[Transparency is] integral to creating an environment of trust, which in turn empowers people to do their best work,” she said. “This transparency and internal alignment allows for accountability and trust, and opens the door for conversation, powering future initiatives and fueling deeper understanding. Sunlight is the best disinfectant.”
Widen Hiring Pipelines
In the process of building diverse and inclusive teams, employers often focus on finding candidates from “underrepresented backgrounds.” This terminology skirts the issue, Johnson said.
“One thing that grinds my gears is the term ‘underrepresented talent,’” said Johnson. “I say ‘underestimated,’ because I don’t think diverse talent is underrepresented — employers are just not looking in the right places.”
In our DEI report, many employers named a lack of resources, weak employer branding and time constraints as the top reasons their diversity hiring efforts fall short. But a staggering 39 percent of employers surveyed said they have no idea why their DEI hiring initiatives are failing. There are a multitude of unconscious biases that leaders must begin to recognize, said Andy Santos, director of people and culture at Chicago-based parking software company SpotHero.
“I didn’t have the privilege to go to a top school — I went to community college first and then transferred to a university,” Santos said. “If your job posting says you want applicants with a bachelor degree from a top school, that is not inclusive to people like me, for instance. You’re already taking a pass on people that had to work hard, had different challenges and might have been strong candidates.”
You’d be hard pressed to find a company that doesn’t encourage diverse and marginalized candidates to apply for jobs, but finding those candidates takes more work than a generic job posting. Johnson proposes that leaders expand their hiring pipelines to include places like Atlanta or Houston and go beyond Silicon Valley.
“You can also start looking at HBCUs and historic women’s colleges,” she said. “It’s also a good idea to partner with organizations like AfroTech and Sistas in Sales, and work on actually building relationships with these organizations. At the end of the day, candidates want companies that have proven that they are leaning into the work of becoming inclusive.”
Support and Collaborate With ERGs
One of the most impactful ways to encourage inclusivity and community building in the workplace is through ERGs. ERGs, or employee resource groups, are company sponsored spaces where employees from a multitude of backgrounds can form friendships, bond over shared experiences, host fun company events and give back to their communities.
At large, employee resource groups are a reliable way to increase support in the workplace. Around 90 percent of leaders currently sponsor them within their companies, according to the Wall Street Journal. But our survey found that in tech only 44 percent of employers are currently building out diversity ERGs within their companies.
There is still a lot of work tech companies need to do to support internal community building and diversity initiatives. ERGs primarily serve to make employees from diverse or marginalized backgrounds feel a sense of belonging, but those employees can also end up shouldering a lot of the burden of DEI work. In order to truly support ERG members, leaders need to recognize their hard work and reward them for their efforts, Johnson said.
“Ultimately, when we’re intentional about DEI, we’re ensuring equal opportunity for those who have not had it in the past and creating room at the table for people that historically have been excluded,” said Doane.
“Being an ERG leader is another full time job, and sometimes ERG leaders are giving more attention towards building an inclusive culture, than to their actual day job,” Johnson said. “One thing that we’re building out is tying ERG leaders’ responsibilities into their performance reviews. We’re also trying to figure out how we can pay ERG leaders for their work.”
ERG’s are proven to be beneficial to employee wellbeing and performance. Around 50 percent of employees say the presence of an ERG would make them more likely to remain at a company, according to the Harvard Business Review. But employees aren’t the only people who benefit from employee resource groups. When people teams actively support ERGs they can learn a lot about how to be more inclusive leaders.
“I’ve been so grateful to learn from our ERGs,” Santos said. “For instance, our people team has partnered with our neurodiversity ERG, and from them we’ve learned how to reevaluate and redesign our interview process so that it can be more accessible for everyone.”
The work to build a more diverse, equitable and inclusive tech industry is just that: hard work. While the results from Built In’s report are promising, overturning decades of prejudice and exclusionary practices and industry is still a daunting task. Tech companies have nothing to lose — and everything to gain — by trying, said Doane.
“Ultimately, when we’re intentional about DEI, we’re ensuring equal opportunity for those who have not had it in the past and creating room at the table for people that historically have been excluded,” she said. “We’re progressing forward, creating a better, more diverse, more equitable, more inclusive, more creative tomorrow. We’re shaping the future, bit by bit, and that’s huge. It’s a win-win, no matter which way you flip it.”