Despite Critics, Diversity Metrics Here to Stay for 2024

Despite the myriad claims to the contrary, HRPA member companies do not appear to be making significant changes to either the setting of specific diversity goals or the tying of quantitative goals to pay, according to a recent HR Policy Association survey.

Continued commitment: Companies are responding to the war on ESG in several ways, including changing how and when they talk about diversity initiatives. What does not seem to be changing for this year is the commitment to diversity targets, even when tied to pay.

Key survey findings: 

• Most member companies that currently tie ESG goals to pay (53%) intend to continue, while those that do not include ESG metrics have no plans to do so in the next two years. 
  
  
• Similarly, of the 38% that currently publish quantitative goals (tied to pay or not), most did not anticipate any change while about 15% said they would make the public goal less specific. 
  
  
• Almost half (48%) said they set an internal (not disclosed) quantitative diversity goal (or will do so soon) and have no intention of stopping. 
  
  
• Only 10% of member companies so far have race and diversity goals outside the U.S. 

Striking back: Several companies are standing firm in the face of legal challenges to programs such as diversity fellowships. Pfizer recently won a victory over Do No Harm, with the Second Circuit noting the failure to identify a single person who had actually been harmed by the program. The Fearless Fund made similar arguments in its challenge to the American Alliance for Equal Rights over its grant contest for Black women business owners. 

Words matter: As Center On Executive Compensation Senior Advisor Charlie Tharp noted in a recent Bloomberg article on terminology shifts in public filings, companies such as Starbucks may “switch to ‘talent’ [to avoid] the term DEI, which has been ‘weaponized’ by the opposition, while still making it clear the company is seeking to broaden the pool of applicants.” In the end, though, “companies [still] use compensation plans to highlight issues they believe are important to investors, employees, customers, and the general public.”