Does Your Company Need a Chief Diversity Officer?

CDOs are all the rage at tech firms right now, but what exactly do they do – and should your company invest in one?
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CDOs are all the rage at tech firms right now, but what exactly do they do – and should your company invest in one?

In the past year, many of the major tech giants and nearly one in fiveFortune 1000 companies have hired Chief Diversity Officers (CDOs). Salesforce is the latest to jump on board, with the addition of Tony Prophet as Chief Equality Officer, in mid-September.

It’s a clear, heartening sign that organisations are beginning to take diversity and inclusion (D&I) seriously. But many business leaders are wondering: what does a CDO do, and does our company need one? Let’s explore this recent trend in more detail.

Diversity in Leadership

First things first: it’s been widely established that promoting D&I is a business best practice. According to a Forbes survey of leading executives, 85% believe that diversity is critical for stimulating innovation, and research from Harvard Business School bears this out: diverse companies are 45% more likely to grow their market share and 70% more likely to have captured a new market in the past year. By these measures alone, D&I is a fruitful investment.

But what do CDOs do? According to Revision Path, a CDO is tasked not only with dreaming up actionable ideas for diversity initiatives, but securing commitment from and collaboration with a host of team members from throughout the organisation – in other words, achieving real results with broad stakeholder involvement.

With that mission in mind, it’s critical that a CDO has real authority to make changes. According to diversity consultant Tanya DePass, a CDO is not simply a figurehead; “Change needs to come from the top down.”

One example of an effective CDO in practice can be seen at international firm SAP. After being hired in 2006, SAP CDO and former economist Anka Wittenberg set firm 2017 diversity targets for the company, such as filling at least 25% of leadership roles with women. By 2013, 19.8% of said roles were held by women, and by next year, they’ll have hit their target, according to TechRepublic. Based in Germany, this year the company has also created 100 new internship opportunities for refugees.

To some, this pace of change may still feel slow, but the progress – and benefits to the company – are tangible.

Filling Your Needs

Naturally, the role of CDO will change depending on the particular needs of your organisation. At Kaiser Permanente, the Chief Diversity and Inclusion Officer, Dr. Ronald Copeland, sees diversity as essential to improving the company’s delivery of care to an increasingly diverse customer base, both culturally and linguistically. As he told TechRepublic, “Like any other mission-critical business function, this role can create a competitive advantage with respect to performance, talent acquisition, innovation, consumer experience, corporate citizen brand, and regulatory compliance.”

In this regard, there’s no limit to the type of organisation that can benefit from instituting such a position. The Fire Department of New York City, for example, hired its own CDO just last year to promote D&I within its ranks. As much as these efforts can feel like a reactive righting of wrongs, it’s also a proactive step for any company looking to meet increasingly global markets head on.

Of course, simply hiring a CDO is no magic bullet – to see real progress, your talent acquisition team and other stakeholders must endeavor to actually hire more diverse recruits and remove unconscious bias from the hiring process. By leveraging video assessment technology and advanced data analytics, you’ll be able to ensure that those changes are robust and measurable.

It will be up to individual organisations to determine whether hiring a CDO is the right move for them. That being said, whether businesses should take a firm path towards increased inclusivity is no longer up for debate.