The retail DE&I imperative

How a diverse and inclusive brand culture lends toward the enhancement of the retail employeeexperience, opening up a plethora of opportunities to attract top talent as well as prospective customers to the brand // By Sean Tarry >>>>

Retail is about people. It always has been, often serving as a conduit of sorts, a place of common ground and a hub of gathering and engagement for the people living within the areas where they operate. In short, retailers from coast-to-coast are a significant contributor to the health and wellbeing of cities and communities across the country, woven deep into their social fabric. As a result, to ensure the health of the brand, retailers have got to make it a priority to reflect the eclectic tapestry of customers that they welcome into their stores on a daily basis. In fact, according to Anne-Marie Pham, Chief Executive Officer at the Canadian Centre for Diversity and Inclusion (CCDI), it’s a priority for businesses that is growing in significance, requiring them to pay much more attention to the development of diversity, equity and inclusion (DE&I) initiatives if they want to compete in an evolving Canadian market.

“Organizations who intentionally focus on DE&I efforts will have better ability to recruit job seekers,” she asserts. “In fact, research has found that 76 per cent of job seekers look at the diversity of companies and 32 per cent would not apply to a company that does not have a diverse culture in place. People seek out inclusive organizations and some choose to leave their current employer to find a more inclusive one. Further, employees who feel valued and are encouraged to bring their authentic selves to work feel more connected to the organization that they work for and are more engaged. This can have extremely positive impacts on performance, including greater workplace creativity and innovation, increased collaboration and enhanced business outcomes.”

Increasingly diverse market

Pham goes on to explain that creating a diverse and inclusive culture is, of course, the right thing to do from a moral perspective. However, she adds that given the increasingly multicultural nature of Canada’s population, the need to do so is becoming what she refers to as a “business imperative”, pointing to the Government of Canada’s recent announcement outlining its efforts to welcome an estimated 500,000 newcomers to the country every year.

This, in combination with a rising indigenous population and an increase in the number of people living with disabilities entering the workforce, means that retailers ought to ensure their businesses are welcoming and friendly, lest they find themselves disadvantaged against diverse competitors in the fight for talent within today’s tight labour pool.

“With an increase in the number of equity-seeking groups in the labour market, the business imperative of DE&I is clear,” she says. “Organizations must incorporate DE&I into their strategies to avoid limiting their access to talent and ensure they enable their workforce to perform at their fullest potential.”

The multicultural consumer

From a customer acquisition and engagement perspective, Pham says that organizations that make the development of DE&I initiatives a priority have the opportunity to significantly improve their brand and reputation amongst consumers. Through the use of authentically inclusive ads and messages, she adds, retailers can position themselves well to attract a more diverse group of customers to their stores.

It’s a sentiment that’s shared by Howard Lichtman, Partner and Co-Founder of Ethnicity Matters, one of the country’s leading multicultural marketing and advertising agencies, who believes that if a retailer today is not attempting to market to Canadians of all backgrounds, they aren’t really marketing at all.

“The most recent census data shows us that one in every four Canadians were not born in the country,” he explains. “And when you stop to realize that it’s a proportion of the population that’s greater than the province of Quebec, it should make you think of the challenges and opportunities that are inherent. Just like Quebec, the multicultural community in Canada is a massive population that needs to be catered to differently as a result of differences in language, culture, religious attitudes, influencers and humour. As a result, this consumer requires a different strategy and approach. And, when you consider the fact that they represent one in four Canadians, 25 per cent of the market, the multicultural consumer is the retail consumer, and brands have got to figure out a more effective way to communicate to and engage with them.”

Canadian newcomers

Ethnicity Matters has been working with brands for nearly ten years, advising them and working with them on the development of strategies and campaigns that will help them reach the Canadian multicultural consumer. And, Lichtman says, given the aforementioned pledge that’s been made by the Government of Canada as a part of its growth strategy to increase the number of immigrants entering the country every year, the opportunities for retailers to capture the attention of newcomers is tremendous.

“Increasing the number of newcomers welcomed into the country each year is the government’s proposed growth strategy,” he asserts. “And it should, as well, be a big part of the growth strategy for retailers operating all across the country. Data shows us that newcomers to the country are extremely open to experiencing new categories and new brands in an attempt to embrace their new home. However, once they pass the exploratory stage of shopping, newcomers typically become very brand loyal. It presents a massive opportunity to retailers in the country to make newcomers aware of their presence, giving them a reason to shop with them, winning them over before their competitors do.”

Current state of DE&I initiatives

In an effort to understand the current state and trajectory of DE&I initiatives among Canadian brands operating today, renowned law firm, Osler, conducted a survey of companies, resulting in a detailed disclosure on the representation of women in senior leadership positions at TSX-listed companies as well as the representation of women, members of visible minorities, Indigenous peoples and persons with disabilities at publicly-traded corporations governed by the Canada Business Corporations Act (CBCA).

The report, titled Diversity among directors and executives in Canada’s consumer products and services industry, yielded a number of areas of improvement for Canadian retailers to focus on. For instance, based on the 33 companies which provided disclosure on the number of visible minorities on their boards, they hold just 11.1 per cent of the board seats. And, when it comes to female representation, Canadian companies operating within the industry have a paltry average of 2.3 women directors and 2.36 women executive officers within their ranks.

Although these numbers for companies operating within the Canadian consumer goods and services industry are higher compared to the average TSX-listed company - within which just 8.3 per cent of board seats are held by visible minorities, and a shockingly low 2.05 and 1.94 women hold director and executive officer positions respectively – there is clearly much work that remains unfinished in order to create a truly diverse and inclusive organization.

Based on these numbers, authors of the report, Andrew MacDougall, John Valley, and Jennifer Jeffrey, suggest that if retailers and other companies have any desire to grow beyond their current customer base and increase the profitability of their brands, women and visible minorities are but two of the segments of consumers and prospective employees that they must focus their attention on. And, if they don’t, they may be limiting their potential innovation and success in a much more substantial way than they could imagine.

“Women represent more than 50 per cent of the population,” the authors assert. “If you are looking to recruit the best and the brightest talent to your organization, wouldn’t you want to eliminate potential impediments, real or perceived, to recruiting from half the population? And similarly, if you are marketing products or services to Canadians, you might benefit from having a cross-section of perspectives in senior leadership that reflects to some degree the demographics of the population.”

DE&I best practices

The report also includes a number of best practices that were disclosed by companies which have been useful in furthering their internal DE&I strategies, including focussing on women in setting recruitment criteria, establishing mentorship programs and providing networking programs, providing training on diversity and unconscious bias, establishing diversity and inclusion committees to promote DE&I efforts, monitoring progress, providing flexible work arrangements and addressing pay equity and systemic issues. It’s a raft of work that’s cut out for any organization looking to create a more diverse and inclusive work environment and culture. However, it’s work, according to the CCDI’s Pham, which can sometimes become derailed or even restricted as a result of various obstacles to the implementation of a DE&I strategy.

“The journey to becoming a more diverse, inclusive, equitable and accessible organization will inevitably encounter obstacles which will vary from company to company,” she explains. “These can include push back in creating a more inclusive culture from those who are not experiencing issues, a lack of willingness to learn, leaders who are resistant to change, biases and micro-aggressions that result in workplace conflict and a sense of exclusion, and a lack of capacity or resources that are needed to order to implement the DE&I work.”

Leading with humility and courage

She says further that in order for DE&I strategies and initiatives to gain traction, leaders within organizations must be the ones who develop the tone and be diligent in building and maintaining accountability for themselves and those around them. In addition, she says that leaders must develop intercultural communication skills, a sense of collaboration and transparency, and the humility and courage to sustain their efforts. However, most importantly, she says, organizations need to ensure that they are not being performative with respect to their development of DE&I initiatives and that their efforts are well thought-out, that appropriate resources are dedicated to those efforts, and that it’s integrated in everything it does. In this way, she suggests, significant change and an improved culture of diversity and inclusion is possible.

“In order to properly begin on the path toward a truly diverse, inclusive, equitable and accessible culture, a current state inclusivity assessment is often required in order to comprehensively understand the workforce demographic profile and employees’ assessment of how they feel respected, included and whether they believe they have equal opportunities to succeed. The assessment should include input from clients, funders and other important community and business partners. This information forms the foundational understanding needed to develop a DE&I strategy that would ideally be integrated into all aspects of the business, including hiring, onboarding, retention, succession planning, customer service, product and service development, and corporate social responsibility.”