Globalization of the labor market is a real opportunity for companies.
However, unconscious bias in managing diverse workforces creates missed opportunities for struggling companies.
As an immigrant to Australia, I have experienced firsthand the challenges that people from diverse backgrounds face in the workplace. That’s why I am such a huge advocate for diversity and inclusion, with 70 percent of my global workforce being culturally and linguistically diverse. This diversity has not only contributed to our success, but has also created a harmonious workplace that hums with productivity and creativity.
According to a 2018 McKinsey report, companies with diverse executive teams are more likely to have industry-leading profitability. On the other hand, companies with little to no diversity are less likely to achieve above-average profitability.
Diversity alone is not enough; it’s also critical that you close your company’s ethnicity pay gap.
It’s a no-brainer, then, that business leaders should be pushing for greater diversity at every level. But diversity alone is not enough; it’s also critical that you close your company’s ethnicity pay gap.
It is no secret that, in many industries, employees from certain ethnic backgrounds are paid less than their colleagues of other ethnicities for doing exactly the same job. This is not only morally wrong, but it can also have negative consequences for your organization, such as high employee turnover and poor workplace morale.
Moreover, employees from migrant backgrounds have left their home countries in search of continuous life improvements, so pay gaps will inadvertently force them to search for improved wage conditions.
Closing the ethnicity pay gap is not only the right thing to do, it’s also good for business. By ensuring equal pay for equal work, you can create a more inclusive workplace where everyone has equal opportunities for advancement. This can help attract and retain top talent and increase overall employee satisfaction and engagement.
1: Measure your ethnic diversity
Before you can close your ethnicity pay gap, you’ll need a strong understanding of the ethnic diversity within your business. But with no internationally recognized yardstick for ‘ethnic’ or ‘ethnicity’, it can make firm parameters for measuring workplace diversity and inclusion a challenge.
Closing the ethnicity pay gap is not only the right thing to do, it’s also good for business.
One tool that can help is a diversity index, which can be used to measure the representation of different ethnic groups within a workforce. By measuring ethnic diversity, you can set goals and track progress toward creating a more inclusive workplace.
Count the number of employees in each ethnic group, and use this to calculate the percentage of employees in each group. You can use your Diversity Index to help you identify areas where your workforce is lacking in diversity and take steps to address it.
It’s also important to go beyond ethnic diversity alone, with a questionnaire designed to measure ethnicity, birthplace, family background, languages and cultural background.
2: Conduct a pay audit
Start by conducting a pay audit to identify any disparities in pay between employees of different ethnicities. This will help you to understand the extent of the problem and the specific areas that need to be addressed. Be sure to involve a diverse group of employees in the audit process to ensure that all perspectives are taken into account.
Once you have identified any pay disparities, set clear policies for paying employees.
Once you have identified any pay disparities, set clear policies for paying employees. This can include establishing criteria for pay rises and promotions, as well as ensuring that all employees are paid fairly for their work. Make sure that these policies are communicated clearly to all employees, so they understand the criteria for pay rises and promotions.
3: Overcome racial bias
Racial bias is a pervasive problem that can hinder business success and prevent businesses from closing their ethnicity pay gap, whether consciously or unconsciously.
Overcoming racial bias within your organization can be challenging, but it is an essential step toward closing the ethnicity pay gap. Bias can influence pay decisions, even when people are not aware of them. Providing unconscious bias training to all employees, especially those involved in making pay decisions, can help to reduce the impact of bias.
It’s also a key step toward building a more inclusive workplace culture that attracts and retains diverse talent, improves employee morale and, ultimately, drives business success.
The first step to overcoming racial bias is acknowledging that it exists within your organization.
The first step to overcoming racial bias is acknowledging that it exists within your organization. Racial bias can manifest in many different ways, from unconscious assumptions about people of different races to explicit discrimination. Leaders must be willing to confront these issues head-on and create a safe space for employees to raise concerns about racial bias.
Educate yourself and your team on issues related to race and ethnicity. This can be done through attending training sessions, workshops and seminars on diversity and inclusion. By educating yourself and your team, you can develop an understanding of the experiences of people of different races and learn how to avoid making assumptions based on stereotypes.
4: Create a diverse leadership team and celebrate diversity
To truly overcome racial bias, it is important to have a diverse leadership team. This means actively promoting people from different ethnic backgrounds to leadership positions. Having diverse leaders can help to create a more inclusive workplace culture and inspire others from certain ethnic groups to pursue leadership roles.
Celebrate diversity in your organization and create a culture of inclusion. This can be achieved through initiatives such as diversity and inclusion training, mentoring programs and employee resource groups.
By creating a culture that values and celebrates diversity, you can attract and retain a diverse workforce, which can ultimately lead to increased profitability and success for your institution. With a positive and inclusive work environment, you can increase productivity, reduce turnover and ultimately propel your business to new heights.
Closing the ethnicity pay gap is not just the right thing to do, it is also essential for the success of your organization. By taking these steps, you can create a fair, equitable and inclusive workplace that values and rewards all employees equally, regardless of their ethnicity.
Vincent Nair is the CEO of SMARTECH Business Systems. Nair has led the growth and turnaround of the business from a loss-making enterprise in 2016 to 988 percent earnings growth in 2022. Under his leadership, the company has had a significant compound annual growth rate (CAGR) of 61 percent over the last six years.