The DEI conumdrum

Making sense of the Corporate America's latest darling

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Ah, diversity, equity, and inclusion (DEI) - the corporate world's latest attempt to solve societal issues while pretending it's all about the bottom line. Throw in some environmental, social, and governance (ESG) criteria, and you've got yourself a recipe for... well, something. Let's dive into this alphabet soup of good intentions and questionable outcomes, shall we?

ESG: Because Saving the World is (Apparently) Profitable Now

Picture this: You're an investment firm wanting to make money (Novel concept, I know). But wait! You also want to look like you care about the planet, people, and “proper governance” because the image of making money in the “traditional sense” just doesn’t cut it anymore. Enter ESG - the financial world's way of saying, "We're not just here for the money, pinky promise!"

ESG boiled down to its core is essentially a report card for companies, grading them on how well they're saving the whales, hugging trees, and not being total jerks to their employees. It's like when your mom used to give you a gold star for cleaning your room, except now it's Goldman Sachs giving gold stars to corporations for not actively destroying the planet.

But here's the kicker: ESG funds tend to underperform right before disclosure events. It's like watching a kid frantically clean their room before mom comes to check - sure, it looks good now, but we all know what's lurking under the bed. Then, miraculously, these funds outperform after disclosure. It's financial magic! Or, you know, just good old-fashioned portfolio shuffling.

And let's not forget the companies that tout their ESG credentials while quietly continuing business as usual. Looking at you, certain oil companies who shall remain nameless (but rhyme with Bexon and Fell).

DEI: Because Diversity is the Spice of... Profit?

Now, let's talk about DEI - the corporate world's attempt to make workplaces look like a Benetton ad from the 90s. The idea is simple: more diversity equals more money. It's like thinking that if you mix all the flavours at the soda fountain, you'll create some sort of super drink. (Spoiler alert: The last time I tried this, I got a tummy ache😔)

Companies are bending over backwards to implement DEI initiatives faster than you can say "unconscious bias training." They're handing out diversity hires like Oprah handing out cars.

But here's the thing: real diversity isn't just about hitting quotas. It's about creating an environment where different perspectives are valued & welcomed. It's the difference between inviting girls to your party and actually conversing with them. Many companies are great at the inviting part, but when it comes to the talking? Well, let's just say their moves need work.

Take tech companies, for example. They love to brag about their diversity numbers, but when you look closer, you often find that the diverse hires are clustered in non-technical roles. Shady? Yes. Needed? Probably not. Waste of everyone’s time? Truly.

BRIDGE: Because We Needed Another Acronym

As if ESG and DEI weren't enough, along comes BRIDGE (Benchmarking Race Inclusion and Diversity in Global Engagement). It's like the final boss in the video game of corporate virtue signalling. BRIDGE is here to make sure that even international development and humanitarian organizations are hitting their diversity quotas. Because nothing says "we're helping the world" like making sure your NGO won’t disclose their financials but seems to host a top-tier gala event every month

But let's be real for a second. The international development sector has long been criticized for its "white saviour" complex. So maybe BRIDGE isn't such a bad idea after all? It's like when your racist uncle finally decides to educate himself - sure, it's a bit late, but hey, better late than never, right?

The problem is, like many of these initiatives, BRIDGE risks becoming another box-ticking exercise. "Congrats, you've hit your diversity quota! Here's your 'Not Racist' badge!" Meanwhile, the underlying power structures remain unchanged. It's like rearranging the deck chairs on the Titanic - sure, the view might be better, but we're still heading for an iceberg.

The McKinsey Effect: When Correlation Becomes Causation (Sort Of)

Enter McKinsey & Co, the consulting firm that launched a thousand DEI ships with their 2015 report, "Diversity Matters." They said, "Hey, look! Diverse companies make more money!" And corporate America collectively lost its mind.

Suddenly, every company was scrambling to diversify faster than you can say "tokenism." But here's the thing about correlation and causation: they're not the same thing. Just because diverse companies tend to be more profitable doesn't mean diversity directly causes profitability. It's like noticing that people who own yachts tend to be rich, and concluding that buying a yacht will make you rich.

The McKinsey report became the corporate equivalent of a fitness influencer's "before and after" photos. Everyone wanted those results, but nobody wanted to acknowledge the possibility of cherry-picked data or other factors at play.

The Great DEI Backpedal of 2023

Fast forward to 2023, and companies are starting to realize that maybe - just maybe - slapping a bunch of diverse faces on your leadership team doesn't automatically make you more profitable. Shock Horror, I know!

Tech giants like Microsoft, Zoom, Google, and Facebook (sorry, "Meta" - I still can't get used to that just like how X is still Twitter) are scaling back their DEI programs faster than you can say "budget cuts."

But let's be clear: this doesn't mean diversity is bad for business. It just means that treating diversity like a magic profit wand doesn't work. It's not enough to hire diverse candidates; you need to create an environment where they can thrive and contribute.

The Inconvenient Truth: Diversity ≠ Instant Profit

Here's the kicker: turns out, that diversity alone doesn't guarantee higher profits. Shocking, I know. It's almost as if running a successful business is... a lot more complex.

Academic researchers trying to replicate McKinsey's findings have had about as much success as me trying to replicate my grandma's secret recipe; It might look the same but it certainly isn’t the same.

Some are even suggesting that maybe - just maybe - successful companies become diverse as they grow, rather than diversity making them successful.

The truth is, that diversity can be a strength, but only if it's leveraged properly. It's not enough to have different perspectives in the room; those perspectives need to be heard and valued. Otherwise, you’re assembling the Avengers and then using them exclusively for coffee runs for Kevin Feige and Co.

The thing is, diversity is a phenomenal tool, it’s implemented at a core level. Take CT for example. You’ll never meet a more diverse group of people (sex, age, geographic location and political affiliations) and yet time & time again, completely anonymous groups come together to work and solve a problem together.

Trying to drive the point home, what 99% of DEI (and now BRIDGE) initiatives miss is the fact that they don’t tap into what diversity can power if allowed to. Denzel Washington puts this more eloquently than I ever could; It’s not colour, it’s culture.

The DEI Industrial Complex

Despite all this, there's a whole industry built around DEI initiatives. Consulting firms are still pushing DEI harder than a used car salesman trying to offload a lemon. It's like they're saying, "Sure, it hasn't worked yet, but have you tried doing it... harder?"

We've got diversity trainings, inclusion workshops, equity seminars - it's like a never-ending corporate Coachella, minus the fun and a lot of uncomfortable role-playing exercises. And let's not forget the "Chief Diversity Officers" - a role that's become more common than free snacks in tech company break rooms.

All of these initiatives, while well-intentioned (and I say this very loosely), often miss the mark. They focus on surface-level changes without addressing the underlying cultural and systemic issues.

So, What's the Point?

Look, diversity is great. Having different perspectives and experiences in the workplace can lead to better decision-making, more innovation, and a more inclusive environment. But treating it like a magic profit-making wand is about as effective as trying to pay your rent with Monopoly money.

Maybe instead of focusing on hitting diversity quotas or ESG scores, companies could try, oh I don't know, creating genuinely inclusive environments and paying people fairly. Just a thought.

Real change takes time, effort, and a willingness to be uncomfortable. It's not about ticking boxes or hitting quotas. It's about creating a culture where everyone feels valued and empowered to contribute their best work. It's about recognizing that diversity isn't just about race or gender, but also about diversity of thought, experience, and background.

In the end, DEI and ESG initiatives, like many things in life, are complex issues that can't be reduced to simple metrics or quick fixes. They require genuine commitment, thoughtful implementation, and a willingness to admit when things aren't working.

But hey, what do I know? I'm just a chronically online pseudo-anonymous writer trying to make sense of corporate America's latest attempt to (show to) solve societal issues while still making a profit. Now, if you'll excuse me, I need to go work on my diverse portfolio of memes and Solana jeet jokes. It's not profitable, but at least it's honest work.

And remember the next time a company brags about their diversity numbers or ESG score, take it with a grain of salt. Make that a whole salt shaker. Because in the world of corporate virtue signalling, things are often not quite as diverse, equitable, or inclusive as they appear.