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Job seekers and employees consider DEI a key factor while evaluating job offers and companies. Research by Glassdoor shows that three-fourths of them rank it as a major consideration. This shows a fundamental change in what matters most to today's workforce.
DEI also has an influence affects your company's success and employee satisfaction. Employees' sense of inclusion makes up 35 percent of their emotional bond with work and 20 percent of their desire to stay with their employer.
So let's learn what DEI means, why it matters, and how to make it work in your organization.
What does DEI mean in the workplace?
DEI (Diversity, Equity, and Inclusion) is a framework that helps organizations build fair and supportive workplaces for everyone.
— Andrés Tapia, Global Diversity and Inclusion Strategist, Senior Client Partner at Korn Ferry
These three letters represent different but connected ideas that come together to promote positive work environments. Diversity means more than just race and gender. It covers differences in:
- Race and ethnicity
- Gender and gender identity
- Sexual orientation
- Age and generation
- Physical ability
- Religion and beliefs
- Socio-economic background
- Veteran status
- National origin
At its core, diversity brings together people from different backgrounds, experiences, and views—just like our society.
Equity is different from equality.
Equality offers the same opportunities to everyone, while equity gives each person what they need to succeed. It focuses on removing barriers—especially for groups that face more challenges than others.
For example, when hiring for management roles, a company practicing equity might focus on a candidate’s skills and experience instead of requiring a four-year degree. This helps include qualified candidates who may not have had the same access to formal education due to financial or social disadvantages.
Inclusion creates an environment where people feel valued and welcome. According to a study by Forrester, 60% of sales teams credit their success to workplace inclusion and diversity. People shouldn't need to "code-switch" or hide who they are at work. This is because companies without sufficient inclusion practices may lose diverse talent. In such conditions, people would leave places where they don't feel they belong.
All these three components share a vital connection. Diversity shows what you have, equity reveals what you want, and inclusion demonstrates what you do.
DEI builds workplaces that value differences, remove obstacles, and enable all employees to contribute their best work.
Why Is DEI Important In the Workplace?
DEI is about more than just hiring people from different backgrounds. It’s about creating a workplace where everyone can grow and succeed.
When inclusion is weak, underrepresented employees are more likely to leave—costing the company big. For example, a company with 2,000 employees could lose up to $5 million a year if turnover between men and women differs by just 5%.
Companies that prioritize DEI also perform better. According to a 2019 McKinsey report, organizations with gender-diverse executive teams were 25% more likely to be highly profitable than those with less diversity. That’s up from 21% in 2017 and 15% in 2014—showing steady improvement.
Ethnic and cultural diversity shows an even stronger link.
Companies in the top 25% for diversity had 36% higher profitability than those in the bottom 25%. And those with more than 30% women in leadership consistently outperformed companies with fewer women leaders.
But DEI isn’t just about profits.
Diverse teams bring new perspectives and better ideas, helping businesses solve problems and stay competitive. Plus, inclusive environments make employees feel valued.
A Pew study found that 56% of U.S. workers believe DEI efforts lead to positive change. When people feel like they belong, 91% are engaged at work—compared to just 20% who don’t feel included.
DEI offers several key advantages:
- Smarter decisions from multiple viewpoints
- Better service to diverse customers
- Stronger company reputation
- Lower employee turnover and recruitment costs
Companies that ignore DEI could face growing risks.
Those ranking lowest in both gender and ethnic diversity were 27% more likely to see lower profits than other companies—a gap that keeps widening.
The newest generation of workers is the most diverse in history. They want workplaces that mirror their backgrounds and value their experiences. Companies that don't adapt would most certainly miss out on talented individuals and fresh ideas that contribute to business and individual growth.
DEI isn't just about boosting profits - its about sparking creativity, attracting and retaining talent, and social responsibility.
How Companies Can Support DEI Every Day?
DEI support goes beyond making statements—it needs to be woven into daily business operations. Organizations should adopt a comprehensive approach to build diverse, equitable, and inclusive environments instead of focusing on isolated HR practices.
Strong DEI efforts start at the top. When leaders actively talk about DEI in meetings and internal messages, it sends a clear signal: inclusion matters here.
This builds trust.
And employees are more likely to believe in DEI when they see their leaders walk the talk.
In fact, research from McKinsey shows that companies with diverse leadership teams outperform others by 25%.
To make DEI more effective, here are some practical steps companies can take:
- Include DEI in performance reviews – This keeps everyone accountable, not just HR.
- Make hiring fairer – Use inclusive language in job posts and involve diverse interview panels.
- Support ERGs – Employee Resource Groups give people a space to share and connect around common experiences.
- Listen and act – Use employee surveys and performance data to identify gaps and opportunities.
- Bake DEI into your values – It shouldn’t be a side project; it should be part of your culture.
Smart companies treat DEI like any other business priority—with clear goals, consistent tracking, and a focus on long-term impact.
When everyone understands and supports these efforts, barriers come down and opportunities go up. DEI isn’t just good for culture—it sparks innovation, improves engagement, and drives sustainable growth.
Real change happens when DEI goes beyond surface-level checkboxes and becomes a part of how your company works, hires, listens, and leads.
How to Implement DEI in the workplace?
"D&I needs to be something that every single employee at the company has a stake in." — Bo Young Lee, Chief Diversity and Inclusion Officer at Uber
A strong DEI strategy reaches every level of your company.
Start with leadership. Executives should lead by example, making DEI a priority through their actions—not just words. Hold them accountable with metrics and action plans that help attract, hire, grow, and retain diverse talent.
Next, build an inclusive culture. Encourage employees to form DEI councils or resource groups. Launch allyship programs that train employees to support one another and build a safer, more respectful workplace.
Listen to your people. Use sentiment surveys to understand how employees feel and what matters to them. DEI only works when it reflects your people’s real experiences—not just top-down decisions.
- Invest in DEI initiatives like inclusive supplier programs and employee training
- Host unconscious bias training to help employees recognize hidden prejudices
- Ensure pay equity—close the gender pay gap
- Support underrepresented groups with mentorships and career programs
- Use skills-based hiring to widen your talent pool
- Make non-discrimination part of your core values
Before building your strategy, assess what your organization truly needs. Tailor your goals to reflect your culture and mission. Clearly define what diversity, equity, and inclusion mean for your company.
Remember, DEI isn’t a one-off task. It’s a continuous journey that should shape your daily work, leadership, hiring, and communication. Real impact comes from making DEI part of everything you do.
Measure your DEI Initiatives
Today’s workforce cares deeply about diversity, equity, and inclusion. In fact, 75% of job seekers consider DEI a top priority when evaluating companies, according to Glassdoor. And it’s not just about optics—a strong sense of inclusion influences 35% of an employee’s emotional connection to their work and 20% of their desire to stay.
But how do you know if your DEI efforts are working?
That’s where ThriveSparrow comes in.
ThriveSparrow is an employee success platform that empowers people leaders to go beyond surface-level DEI initiatives. With ThriveSparrow, you can:
- Run customizable DEI surveys to understand if employees feel represented, respected, and included
- Measure the effectiveness of current DEI policies across different departments, teams, and demographics
- Identify what’s missing—from equitable hiring practices to inclusive communication
- Gather feedback that uncovers hidden barriers and spotlights areas for change
- Track improvements over time using data-backed insights tied to sentiment, engagement, and belonging
Whether you're designing ERGs, building inclusive hiring pipelines, or simply trying to understand how supported your teams feel—ThriveSparrow gives you the tools to listen, act, and grow.
Sign up for a free trial and get access to several survey templates, or book a free demo and get a complete walkthrough from a product consultant.
FAQs
1. What are the key components of DEI in the workplace?
DEI stands for Diversity, Equity, and Inclusion. Diversity encompasses various aspects like race, gender, age, and background. Equity ensures everyone has fair opportunities to succeed. Inclusion creates an environment where all employees feel valued and welcomed.
2. How does implementing DEI benefit a company?
Implementing DEI can lead to increased profitability, enhanced innovation, better decision-making, improved employee engagement, and a stronger company reputation. Research shows that companies with diverse executive teams are more likely to outperform their peers financially.
3. What are some effective ways to support DEI in daily operations?
Companies can support DEI by incorporating it into performance reviews, revamping recruitment processes, creating Employee Resource Groups, using data-driven insights to identify areas for improvement, and integrating DEI into core company values.
4. How can leadership contribute to successful DEI implementation?
Leadership plays a crucial role in DEI implementation by demonstrating commitment, addressing DEI issues regularly in meetings and communications, setting clear objectives, and being accountable for achieving high standards. This top-down approach helps set the tone for the entire organization.
5. Why is there sometimes resistance to DEI initiatives?
Resistance to DEI initiatives can stem from concerns about meritocracy, fears of reverse discrimination, perceptions of divisiveness, or skepticism about effectiveness. It's important to address these concerns through open dialog, emphasizing that DEI aims to create equal opportunities rather than lower standards, and implementing data-driven, well-designed programs.
