In 2016, a typical white family in the U.S. had a net worth of $171,000, while a typical Black family had a net worth of $17,150, according to The Brookings Institution.
It’s a shocking disparity and a key statistic called out in the Detroit Equity Inc. (DEI) 2022 Detroit Equity Report. DEI released its report, developed in partnership with Wayne State University’s Damon J. Keith Center for Civil Rights, at the 2022 Detroit Equity Symposium in September, an inaugural event attended by Detroit corporate and civic leaders.
The symposium’s call to action was clear. DEI is determined to bring together Detroit’s business and community leaders to foster the innovation and actions needed to create real progress – so every Detroiter has access to opportunity, according to DEI Founder and CEO Bishop Edgar L. Vann.
During the symposium’s keynote address, Lt. Governor Garlin Gilchrist II stressed a key point: diversity, equity and inclusion are worth the time and investment because they will make the city of Detroit and the state of Michigan stronger.
The 2022 Detroit Equity Report reinforces this idea – diversity, equity and inclusion aren’t just the right things to do, they provide value. The report outlines key data points, actionable steps and case studies aimed at:
Increasing the number of Detroiters and people of color represented in Detroit’s workforce
Boosting the number of Detroiters and people of color in the pipeline for executive leadership and board positions
Connecting Detroit-based and minority-owned businesses with supplier and procurement opportunities
Here are a few examples from the report.
Diverse Interview Panels Enhance Workforce Diversity
This type of affinity bias can quickly disregard well-qualified candidates, denying them an employment opportunity and causing companies to lose out on potentially valuable team members. To alleviate bias in the hiring process, more and more companies have turned to diverse interview panels in lieu of a single hiring manager. These panels typically represent different age, gender, race and ethnicity groups. They include people with different backgrounds and experience, bringing a range of perspectives to the table.
Use of diverse interview panels prompted Intel to increase its hiring of women of color from 31% to 45% and at Cisco, it increased the likelihood of employment for African American women by 70%, according to the DEI report.
Board Diversity Helps Companies Better Understand Communities They Serve
Affinity bias also comes into play in the boardroom, often leading to recruitment of non-diverse boards.
In 2018, women of color made up only 4.6% of Fortune 500 board members. In 2019, ethnic minorities in the U.S. made up only 10% of Russell 3000 board members, according to a Center for American Progress report.
Companies with non-diverse boards often develop a group-think mentality. They lose the benefits of diversity: members who better understand the communities they serve, diverse viewpoints that lead to more meaningful discussion, and guidance that prepares them to be more inclusive with future markets and employees.
But Henry Ford Health System, for example, recognized the value of board diversity and made a concerted effort to be more inclusive. The company conducted a board assessment to identify gaps, set specific board diversity goals and broadened its slate of candidates. It now operates with a board that more accurately reflects the communities it serves.
MWBEs – businesses at least 51% owned and operated by traditionally underrepresented groups, including women, minorities, veterans and LGBTQ+ – represent more than 50% of all U.S. businesses, but only generate 6% of the revenue, according to the DEI report.
To improve supplier diversity and expand business opportunities in marginalized communities, U.S. companies have implemented several key practices:
Partnering with organizations that champion the cause and can connect them with diverse suppliers
Developing tier 2 supplier programs that encourage tier 1 suppliers to contract with diverse small businesses
Instituting inclusive bidding processes, vendor mentoring, and program tracking and assessment
DTE Energy, for example, sets formal supplier diversity goals, distributes weekly reports and runs gaps and opportunities through an advisory council to help strengthen policies that foster competition and inclusion. Blue Cross Blue Shield of Michigan hosts Supplier Diversity Achievement Awards to recognize employees who lead the way in achieving supplier diversity goals.
The benefits of a diverse supplier base are real.
According to a Korn Ferry report, for every $1 million Microsoft spends with diverse suppliers, 75% is retained by the local community and more than 17 jobs are created.
Detroit Equity Inc. will continue to work with Detroit businesses to help them develop policies to address these issues; make employees accountable for diversity, equity and inclusion; and better understand the community so everyone gets a seat, a voice, a stake at the table.