Defining DEI and why it matters

DEI activities are measures that organizations implement in order to make employees feel like they are respected and treated fairly in an inclusive environment. 

Here’s why I believe DEI is important. A well-positioned DEI framework allows companies to be more successful because implementing these measures will enable companies to make better hiring and promotion decisions, avoiding bias as much as possible. Furthermore, DEI initiatives effectively motivate and retain people with an inclusive culture. 

DEI is essential on an organizational level for ensuring legal compliance with the non-discriminatory laws and regulations on a country and EU level. Additionally, DEI activities effectively avoid ‘groupthink’ by encouraging diverse perspectives, which is crucial in innovation processes. Finally, DEI matters for companies also to create a positive image for the organization and improve internal and external branding. 

My personal definition of inclusion is a society where the constructed barriers have been torn down. Being able to live in alignment with this personal belief is really satisfying. 

Starting a DEI initiative in a company

The most challenging aspect of pioneering DEI initiatives in a company is having so many possible directions and platforms to work on. Having an immense amount of sources and support helps, but companies need to be careful to decide what initiatives can bring long-term change and the best return on investments for their workforce. 

In the beginning stages of introducing a new initiative, companies define and choose what kinds of diversity to focus on. That includes selecting the most relevant KPIs to track and measure to determine whether the initiatives deliver on their progress or need some tweaking over time. Remember that you will need leadership on board, and you only have a certain percentage of the top management’s attention besides other things on their agenda. 

Besides defining communication plans and preferred channels for the initiatives, companies will also be looking at what platforms and tools to use to meet company goals. It’s essential to do the groundwork and have a crystal clear vision regarding the employee and company DEI expectations before starting any initiative, because lots of possibilities will surface, but you will only be able to choose some. 

Getting stakeholders on board

Working in HR, people have always been at the center of my work. Coming into a large organization after our local Croatian and Slovenian company merged with the big European payment processor opened all of us in the company to areas not previously explored; for me, this was the DEI area.

Stakeholders are those who have expectations from our organization, so in our case, it was not difficult to get stakeholders on board because they are the ones who were asking for change. The challenge is to keep consistent effort and results from the D&I initiatives.

By stakeholders, I mean everyone – company shareholders, the society organization is a part of, job candidates reviewing the organization as a potential future employer, partners and suppliers, media, and off course, the employees.

Starting the D&I Board at Nexi Group

The beginning of our D&I Board came about in a very organic way. Some two years ago, we hosted an internal event on people matters. The event was organized as an ‘unconference’, a type of conference without agenda and no timelines set in advance, where people meet and talk and decide together on what they want to talk about and what is important to them.

Some of us have gathered around the topic of DEI, and I’ve been working on it since. This natural way of organizing people into topics, in which you can join a certain topic, contribute to it, stay with it or move across topics, according to where you’re most interested in staying and where you can contribute the most, is a great way to come up with new ideas. It’s helpful not to predetermine priorities but to let them surface from the dialogue. That way, people naturally passionate about various topics gather together, and companies ensure that the best people are involved in a project.

When we started the D&I Board at Nexi Group, we wanted to be everywhere and jump on every train, but we soon realized that the gradual approach was more sustainable in the long term. We’ve spent the entire first year and a half just on the topic of gender diversity. And a lot happens in the background before an initiative sees the light of day. At first, we set up the Board, wrote the diversity policy, and created an e-learning course that all employees must go through when joining the company. At that point, we still hadn’t started concrete diversity initiatives, as we were still setting up KPIs, reviewing hiring practices, employee activation, etc.

The D&I Board at Nexi Group comprises representatives of different diversity groups, major functions, and leaders who steer the agenda, and the Board reports directly to the CEO. It is prevalent in Europe to have diversity councils or boards, whereas, in the US, there are many more employee resource groups. The difference is that the ERPs (employee resource groups) often report to HR because their activities revolve more around asking for budgets, approvals, or time slots with the management. On the other hand, some companies introduce CDOs (Chief Diversity Officers) which are relatively new roles that globally mainly report to the head of HR. In contrast, in the US, CDOs often report directly to the CEO or COO.

Maintaining DEI initiatives

It’s one thing to start an initiative, but it’s another thing to keep it going with sustainable success. Consistent support is vital; even the most well-designed initiatives may fail without it.

For the first year of starting with DEI, just like any significant change, you need to nurture this baby to grow healthy and go on its own. It would be best if you had the right people to take over certain activities – people who have passion for this topic.

If you support these people by giving them space within the organization and time with the management, with a budget and clear objectives, they will repay you by taking ownership and pushing things forward. The more people you can activate with the DEI initiatives, the better.

Ideally, your activities are well-targeted, defined and placed, valuable and appreciated by the environment, and they will grow by themselves. However, reality sometimes throws a different spin on things. Most nice-to-have but low-value initiatives are destined to die out. There has to be a balance between how much you’re looking to invest, and how much you will get out of it.

Involve the CEO

One good practice in our D&I Board meetings is that the CEO acts as the sponsor so that each group working on different projects has to present their achievements, plans, and progress. We have found it very motivating when you have to present your work to the CEO. Additionally, this practice shows everyone how relevant the project is to the organization and further engages people involved in the project. They also get to know people from across the organization, experience and learn new things and enrich new work – which is key to retaining these employees.
The role of technology in DEI initiatives

Tech plays a significant role in supporting DEI initiatives. Our DEI tech stack features several tools we selected to serve our company goals. One of the most interesting ones is a language proofing tool that we use to verify company communication, such as job ads for example. The tool highlights specific nouns and verbs and offers alternatives depending on which group we wish to target. There’s a lot of AI involved in this.

The tech solutions are at the base of making it happen, especially at a big organization like ours. Since we employ more than 10 000 people, over 50 nationalities, tech helps us scale, organize and track. We have a lot of data to manage, so a data management system is paramount to keep track of the initiatives’ success and monitor metrics against any KPIs we set. Leveraging employee data stored in our central system, we use the equal pay reviews practice for our standard annual or biannual audit of payments and procedures.

Additionally, since we live in the real world, and biases happen often, we want to ensure that our employees have a way of flagging this type of behavior. For that, we use secure and reliable platforms where employees can submit complaints and reports in case they experience bias. These platforms support employees by maintaining anonymity and managing these workplace issues most sensitively.

Tech also powers our internal communication channels. We’ve opened an eLearning channel on which our people post a lot of different topics for everybody who wants to learn more. Finally, I’d mention a language learning app we made available for our employees, which aids our cultural diversity.

Measuring the success of DEI activities

You have to decide smartly what your KPIs are. We set KPIs on what we want to achieve in a year or longer and track our progress against these goals. It’s essential to be realistic with the KPIs and set something measurable that your company can act on.

We pull some of our employee data from the core HR system. For our gender diversity goals, a couple of useful metrics to track are the ratio of women to men in the workforce, the gender ratio in the failed hires of a niched group of applicants, and the ratio of women to men in the candidates’ pool.
We also set a goal, such as the number of posts in the internal communications network channel dedicated to the LGBT community.

Another way we measure the success of our initiatives is through an employee listening program, which includes having a set of dedicated DEI questions in the annual employee survey and occasional short pulse surveys. Once a year, we have an employee satisfaction and engagement survey with a set of questions relating to DEI. We ask employees to tell us whether they feel like they can be their authentic selves at work and whether everyone has the same chance to succeed at work rather than asking directly about their kind of diversity. With this set of questions, we already have a benchmark from last year’s surveys to track our progress against those.

Privacy matters and disclosing diversity

In the future, we’d love to have a survey dedicated to DEI specifically, but this is not for an organization’s beginning stages of DEI initiatives. Furthermore, in Europe, the GDPR (General Data Protection Regulation) scrutinizes gathering such personal data, as they are pretty sensitive, so we have to be very careful about that.

Additionally, employees have to have a high level of trust in their organization in order to share enough for companies to have a representative amount of data because they have to volunteer this data. Of course, once you ask for something, you must be fully ready to act broadly on all the results.

Besides the overarching European Union’s GDPR, every country has its laws. For our organization with 10000 employees across Europe, we also need to consider the laws of specific countries and the company-level agreements with union workers’ representatives on what you can collect. You have to be sensitive and aware of different work cultures when working with more than 50 nationalities.

There are so many dimensions of diversity, making it questionable whether it should even be a goal of a company to try to collect these diversities and have perfect statistics because that is
currently unfeasible. Instead, we should remember that working on DEI is about creating a safe and respectable environment where a person can step up and ask what they need to feel accepted and supported. It’s about being accountable, showcasing diversity across the organization’s hierarchy, and then having a secure channel for dealing with unwanted behavior.

Stewarding a cultural transformation during mergers and acquisitions

Each merger comes with its own set of projects, and once all the aspects of a merger are agreed on, the merger is treated as a program with multiple projects inside it. This includes primarily the business integration, integration of products and services, platforms, IT streams, and so on.

Also, mergers require employee transfers and instituting new operating models, mapping databases making sure that employees are allocated according to their skill level and expectations. This is relevant because it decreases ‘change fatigue’ and overall employee satisfaction. However, these do nothing per se for the new culture.

When we started the integration project in 2020 with Nets, we introduced a stream in the program called ‘Ways of working.’ We applied a standard methodology to define work cultures, how decisions are made, how meetings are managed, the expectations for meetings, the typical spread of working hours, how business communication is conducted, and even how employees relate to each other, and so on. With the help of consultants, we investigated the working cultures and ways of working in our organizations and came up with a common way of working for the future.

Using our companies’ cultural values as guidance, and with these findings, we created a playbook for leaders so they can initiate dialogue with their team and set a new way of collaborating going forwards.

The business case for including DEI in the cultural transformation program during M&A

The business case for DEI is always there, and it’s not that companies deal with this out of genuine altruism; there is a clear business case for it. For starters, showcasing your approach to DEI enlarges your candidate pool, which is an important factor in the ongoing war for talent. You can not afford not to approach a particular group, for example, people with disabilities; companies need to do this if they want to be able to attract talent. We’ve already talked about the influence of DEI initiatives on engagement and retention.

Secondly, DEI supports innovation. If you are innovating products and services and want to be on top of it, then you have to have representation of the world outside for whom you are doing this development.

Since national legislations have started penalizing companies that don’t comply with DEI standards, for example, do not have an acceptable gender ratio in the top management, or don’t employ people with certain disabilities, it’s better to avoid legal battles over issues that DEI initiatives could address in the first place.

And in the context of mergers and acquisitions, it is vital that whatever surfaces as the new culture or strategy, to keep DEI right there. We are now undergoing the next big integration. From Jan 1st, we will be merged with Nexi Group, and I’m proud to say that having an international and inclusive team is one of the four pillars of the entire Group’s strategy.

Final Words

One type of diversity DEI boards also need to consider is age-related diversity. People of different ages generally have different learning styles and needs. Due to the extension of life expectancy, aging demographics, and the age at which people retire, there are about four or five generations in the workforce simultaneously. All generations have DEI expectations, but they differ, as their starting points are different, too.

Nowadays, DEI is a part of a broader framework, environmental, social, and government framework in companies. In the future, DEI will become an integral part of how we do business like we have data protection now. I hope it doesn’t become a mere regulatory activity but that it remains a strong driving force for the internal organizational setup and a tool for employee engagement.

On a personal note, DEI opened up new doors for me; I met some great people that, perhaps in the course of my work, I wouldn’t have. It expanded my horizons, taught me a lot, and enriched my daily job. Sharing experiences and expectations on what DEI should do for people in our company and making work life better for everyone involved is how I like to spend time working.

 

About the Author: 

Iva Penezic is a head of HR for Nexi Croatia and a member of the Diversity & Inclusion Board in Nexi Group. She started in HR many years ago, and has worked in the FMCG and banking before working in the payment industry as she does now. 

Her experience in HR ranges from recruitment and selection, development and training, and now in a head of HR role, she creates policies, advises leadership on people matters and is included in transformation programs on a company level.