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Setting Diversity & Inclusion GoalsStrategies and Benchmarks
(Information for the Insurance Industry)
1
DBP RESEARCH REQUEST
Industry Benchmarks
Prudential set a gender diversity target of 30% females in senior management by the end of 2021
80% of Prudential’s non-employee directors are diverse:• 3 director nominees have worked outside
the United States
• 2 director nominees are African-American
• 1 director nominee is Asian-American
• 2 director nominees are Hispanic
• 3 director nominees are Women
• 1 director nominee is LGBT
Prudential
Source: Prudential
In 2018, Prudential’s long-standing commitment to developing its talent was evidenced in the seamless succession process for the CEO and key executive leadership roles that brought together accomplished individuals with different experiences and a breadth and depth of knowledge and skills.
Prudential also established a process that aligned strategy, capability and talent as a part of the Chairman’s Review of Talent. Each business and corporate function leader identified the critical capabilities and roles necessary for their strategy and in concert followed a disciplined review of their top talent. This was further bolstered by the talent development strategy, Philosophy and Career Principles documents that now serve as a consistent enterprise framework for talent decisions and career advice to all employees.
These results are anchored in the Human Resource strategy and commitments. They are:
1. Prudential has world-class talent in our critical roles.
2. Prudential’s businesses have the organizational capabilities to win.
3. We are a standout company for inclusion and diversity.
4. We have a unique and compelling culture that drives competitive advantage.
Prudential
Source: Prudential
Employee Engagement Research confirms that an engaged workforce leads to higher productivity, higher profitability, higher customer satisfaction, and lower employee turnover and absenteeism. Given the importance of employee engagement to business outcomes, Prudential is committed to listening to employees through ongoing surveys and other feedback channels.
Prudential’s engagement approach includes an employee engagement measurement strategy that involves a model that touches nearly every employee every year. In 2018, over 50 employee surveys and focus groups collected feedback throughout the employee lifecycle—from onboarding to exits—to understand experiences, behaviors, attitudes and perceptions of leadership, culture, and key organizational issues at any given time.
In addition, the reach of our Employee Engagement Survey will be broadened—the EQ. The EQ, which was introduced in 2017, provides insights that help leaders better understand and influence engagement. In 2018, it was established that the EQ will be done across Prudential’s international offices and has been working across regions to bring the implementation of its first global survey in 2019.
Prudential also held its first ever Culture Jam, a three-day online discussion forum. This innovative platform engaged employees with chat rooms, live polls, Q&As with leaders to foster conversations and collect ideas for creating a stronger more inclusive culture. More than half of employees in the United States registered for the Jam, with nearly 12,000 posts sharing stories, ideas and suggestions for enhancing the employee experience, how to better serve customers, how we tell the company’s story, and how to remain committed to the company’s purpose.
Prudential
Source: Prudential
For Prudential’s high-potential diverse leaders, the company launched two new enterprise executive development programs with 48 leaders participating in the first year. Senior executives were deeply involved in the design discussions, aligning the programs with business strategy and the key skills and attributes needed to execute on that strategy.
An intensive three-year high-potential experience graduated its second cohort in 2018. Prudential created an 18-month leadership development program that will launch in 2019. These experiences, which feature internal executives leading components of the programs, are focused on accelerating leaders’ development to prepare them for growing responsibilities andto lead Prudential into the future.
Senior Leader Accountability – Long-term incentive compensation for all executives at the senior vice president level and above is subject to a performance objective intended to improve the representation of diversity among senior management.
Prudential
Source: Prudential
Progressive
Leadership developmentAs we continue to develop and promote our own, we'll continue to make progress diversifying our leadership. We recognize this as an opportunity and we're investing in development programs and on-the-job experiences to accelerate our progress.
One very successful example of these efforts is our Multicultural Leadership Development Program. More than 80% of graduates of this 18-month program have been promoted into new positions and are advancing their Progressive careers.
Source: Progressive
Equal payOur commitment to pay equity is straightforward—we demand it of ourselves. We’re proud to report that for Progressive employees with similar performance, experience, and job responsibilities, women earn one dollar for every dollar earned by men, and people of color earn one dollar for every dollar earned by their white coworkers.*We recognize that our commitment to pay equity requires our constant attention and we take regular steps to ensure that our people’s compensation reflects their performance, experience, and job responsibilities, and nothing else. We’ll report our pay equity measures annually.*In evaluating pay equity companywide, we use a regression model that considers the following components of compensation: annual salary, cash bonus (Gainsharing), and stock awards. These are point-in-time measures (as of January 2019) that include all Progressive employees other than our CEO and the executives reporting directly to her, whose compensation is approved by the Board’s Compensation Committee. For information on executive compensation, please refer to our proxy statement.Talent MobilityAt Progressive, employee mobility is a top priority: each employee is empowered to achieve their professional goals and contribute to the company in meaningful ways. One way it does this is giving employees the latitude to move around within the company throughout their careers. Progressive reports that out of its 37,000-person workforce across the country, more than 5,000 employees change levels or positions each year.
Progressive
AIG launched its Global Inclusion and Cultural Agility (GICA) initiative in 2016 with a focus on five work streams. The goal for the GICA initiative is to integrate diversity and inclusion into our core businesses and human capital processes. Two senior executives led each work stream. Nearly forty employees from multiple countries volunteered to work with the executives over several months to develop specific recommendations to broaden and accelerate diversity and inclusion at AIG. Five goals were established to provide the overarching framework for the inclusion efforts:
Business Alignment: Acquire deeper understanding of the needs of our current and potential diverse customers and use those insights to create additional market value.
Community and Brand: Build our reputation in the market and improve our attractiveness to diverse clients and potential employees.
Diverse Talent Pipeline: Attract and engage emerging generations to develop a sustainable pipeline to feed leadership succession.
Equity and Measurement: Strengthen our focus on fairness to ensure that we deliver equity of opportunity.
Global Mindset: Understand how to bridge cultural differences to leverage the diversity of thought that comes from all people and places.
AIG
Source: AIG
AIG
Source: AIG
The Hartford understands that companies must provide an experience that meets an employee’s unique needs in order to maximize their potential and motivate them to achieve business goals. This is particularly important for talent that’s demographically underrepresented in the insurance industry. We will continue to invest in talent strategies that support our goal toward the 75th percentile, including:
• Evaluating our talent management systems, including succession planning, executive recruitment, as well as development and retention strategies.
• Measuring progress with a Diversity Talent Mobility Scorecard, reviewed quarterly by the CEO and executive leadership team.
• Measuring ERG Value: 3% higher rates of engagement for ERG members than The Hartford’s workforce overall, and 3.2% higher retention rates among ERG members than The Hartford’s workforce overall
• Providing D&I training: 90+% of employees and managers completed “Appreciating Differences & Managing Inclusion” training to: understand the importance of diversity in the workplace, motivate them to actively promote workplace inclusion.
The Hartford
Source: TheHartford2018
The Hartford
Source: TheHartford2018
The Hartford
Source: TheHartford2018
The Hartford
Source: TheHartford2018
The Hartford
Source: TheHartford2018
USAA
To promote inclusion and maximize organizational and individual potential, USAA:• Provides diversity and inclusion skill building and training• Celebrates cultural heritage month events recognizing our rich diversity• Offers multiple career development and mentoring resources and tools• Leverages multiple feedback channels for employee ideas• Maintains an innovation lab and interactive tools and resources to foster inclusion and innovation• Conducts engagement surveys of all employees• Utilizes Diversity Business Groups (DBG's) to assist in creating an inclusive environment and turning
diversity into measurable value for the association
Source: USAA
Aetna’s diversity strategy ”ICE”(integration, communication and education) is a unique marriage of diversity values and business strategy. The major components of “ICE” include: New-hire orientation with an overview of the diversity strategy, an internal diversity web site that houses information and resources related to diversity and inclusion along with Aetna’s mission and strategy, regularly published articles on diversity topics on their intranet, a speaker series about diversity programs available to all employees via live webcast, and transparency of diversity initiatives and data at quarterly managers’ meeting and at all-employee meetings. To keep these initiatives effective, metrics are used to assess the business impact of its diversity initiatives
Aetna
Source: Cornell University
Aetna Diversity Metrics
Source: Cornell University
Allianz’s global target for women in Boards of Management is 25% and 40% in talent pools by the end of 2021. At Allianz SE, the group‘s headquarter, and Allianz Germany, its biggest entity, the company has committed to achieve at least 20% in the first and 30% in the second tiers below the Boards of Management by the end of 2021.
Allianz
What some other companies are doing…
Comerica
Step 1: Create Reporting and Metrics for the Organization and Executive Leadership• Comerica tracks metrics and creates accountability through a Diversity Involvement Scorecard for every
senior leader, including the CEO. The scorecard measures the following areas under each leader’s control:• Workforce diversity• Business outreach• Volunteerism• Supplier diversity.Within each category, Comerica defined specific metrics for each leader. For example, workforce diversity focuses on hiring, promotions, and retention. Within hiring, the metrics track the application pool for age, gender, and minority/nonminority compared with the employees hired. The same process and metrics applies to promotions and retention to provide an extensive review of D&I in all business units. By using a workforce analytics tool, leaders and the diversity team know exactly where each leader is in relation to the goals.For example, if the technology department promotes fewer women than men to the senior and manager levels, then the technology leader develops a specific goal to help solve the issue. The goal may be requiring that 50 percent of the applicant pool for all senior officers be female. The hiring decision can’t be made until the application pool meets the criteria.
Source: Affirmity
Comerica
Source: Affirmity
Step 2: Hold Leaders Accountable for Achieving D&I ObjectivesAt the beginning of the year, leaders set goals for each area, and HR tracks results against these metrics throughout the year. The diversity team, the leader’s HR business partner, the CEO, and Comerica’s Executive Diversity Council review the goals.
Each leader knows exactly to which metrics he or she will be held accountable and the numbers needed to achieve the goal. The Diversity Involvement Scorecard results determine his or her end-of-the-year compensation.
Step 3: Create Benchmarks for Realistic and Business-Focused PlansComerica leaders meet with their HR business partner each quarter to review their progress. They discuss the trends based on the metrics, opportunities to improve, and changes to make. Common outcomes from the meetings include organizational changes and training in areas such as unconscious bias. After the meeting, the diversity team also discusses how to support the leader as he or she works to create organizational changes.
Step 4: Evaluate Alignment of D&I Initiatives with Organizational Strategies, Objectives, and CultureComerica weaves diversity programs and awareness through all aspects of the organization. Through market segmentation teams, employees focus on understanding the needs of specific multicultural markets and improving both products and sales methods for the community.
For years, Volvo Cars’ manufacturing plant in Sweden, had around 15-20% female employees. To achieve a better gender balance at all levels, they set clear goals and tracked progress monthly. One focus was on hiring, so they requested the recruiting agencies to ensure at least 50% female candidates for any interview and held them accountable to deliver. Where needed, supporting measures where implemented, e.g. a cooperation was set up with the Swedish Labor Office that started a fork lift education program specifically for women. Internally, the gender balance initiative was supported using various communication channels, including their internal website and magazines, town hall meetings, leadership training, and introduction programs for new employees. Between January 2015 and July 2017, the share of female employees increased from 20% to 31%, for leaders their share increased from 19% to 24%.
Volvo
In 2013, Tracy Chou (a female Asian-American programmer) disclosed to the world the lack of diversity at her organization. In an effort to fix the problem, Pinterest brought in more applicants from nontraditional backgrounds yet the diversity numbers did not improve. CEO Ben Silbermann and cofounder Evan Sharp realized they had to give their employees a reason to care about diversifying and prove that diversity was about the bottom line. By sharing D&I goals publicly, Pinterest is held to a higher degree of accountability.
Here are Pinterest’s D&I goals:• Increase hiring rates for full-time engineering roles to 30% female.
• Increase hiring rates for full-time engineers to 8% underrepresented ethnic backgrounds. • Increase hiring rates for non-engineering roles to 12% underrepresented ethnic backgrounds.
• Implement a Rooney Rule-type requirement where at least one person from an underrepresented background and one female candidate is interviewed for every open leadership position.
Source: DBP Research Report
Walmart established a range of diversity and inclusion goals. Here are a few examples:
• Increase sourcing from Women-Owned Businesses
• Empower 1 million women through training
• Promote diversity and inclusion representation within merchandising and professional services suppliers
• Veterans Welcome Home Commitment will guarantee a job offer to any eligible U.S. veteran honorably discharged from active duty
• Hire 100,000 veterans by 2018, increasing the projection to 250,000 veterans by the end of 2020
Walmart
Source: DBP Research Report
Sample Metrics to Consider
Simple measures are unlikely to achieve what is intended. For instance, often touted as a simple, quick ‘fix’ is to tie executives’ bonuses to hiring more women and minority talents. Some incentivize their recruiters and employees to bring in more diverse candidates. While this carries appeal as a way to show that the organization is ‘serious’ about diversity, it can nevertheless backfire. It can seduce people to hire for bonus rather than for skill, experience, and ability.
Such an approach can set minority talents up for failure by reinforcing stereotypes and bias. Also problematic with D&I goals is that simply bringing in more people who are ‘different’ does not create an inclusive organization that is set to leverage the uniqueness of these new employees. Hiring to meet the diversity numbers doesn’t address root causes of biased decision making, processes that limit rather than widen the talent pool, and a culture that isn’t open to difference.
Meaningful metrics must be focused at the specific challenges an organization is facing and should show a turn-around of a trend that is of concern. This could be aspects like differences in engagement scores based on personal demographics, or a higher share of attrition or lower promotion rates of women and minority talents.
Setting Your D&I Goals
Source: Vantage Newsweek
• Hiring, retention, promotion, lateral mobility numbers
• Velocity of movement (how long it takes to hire, promote or move laterally)
• Percentage of development, succession and talent plans that include underrepresented groups
• Velocity of development plan completion (how long does it take to implement plans)
• Percentage of sponsorship, mentorship program participants who are from underrepresented groups
• Number of sponsorees, mentees with positive movement as a result of program
• Engagement and D&I index scores per leader
• Percent of the talent pipeline that is diverse
• Number of ERG active members, active allies
• ERG ROI impact (e.g. #Recruits, # referral conversions, $ sales, market development, community giving, supplier diversity support, retention impact (turnover reduction))
• Employee engagement scores or survey results parsed by race, gender and other underrepresented categories
Metrics to Consider
Source: DBP Research Report
Promotion
Description: Tracking promotions awarded to individuals from monitored groups compared with promotions awarded to individuals who are not members of a monitored group.
Strength: Useful for identifying bias in assessment and selection.
Weakness: Does not indicate whether members of monitored groups are self-selecting out of promotion opportunities. For example, studies have shown that women are less likely than men to put their hand up for a promotion. Also, does not track whether members of monitored groups are being developed or promoted at the same rate as non-monitored individuals.
Improvements: Track promotion applications from members of monitored groups compared with promotion applications from individuals who are not members of a monitored group. Track the time it takes for members of monitored groups to progress compared with non-monitored individuals. A difference may be indicative of a performance vs. potential bias that favors members of the dominant group. Track and compare development opportunities offered to members of monitored groups and compare with development opportunities offered to individuals who are not members of a monitored group.
Metrics to Consider
Source: CulturePlus
Development Description: Tracking lateral moves, appointments to acting roles, training and other learning and development participation, and other stretch assignment opportunities by identity group.
Strength: Useful for identifying bias in development.
Pay and benefits Description: Compare financial and non-financial rewards earned by individuals from monitored groups to financial and non-financial rewards earned by individuals who are not members of a monitored group.
Strength: Useful for identifying bias in compensation and reward schemes.
Weakness: Like-for-like pay equality (equal pay for an equal role) obscures inequality in opportunity.
Improvements: Analyze pay and rewards across rank and function. For example, do men, on average, earn more at your organization (or department or workgroup) than women earn, over average? If the answer is yes, there is a bias against women in your organization, even if on a role-for-role basis, women earn the same as men.
Metrics to Consider
Source: CulturePlus
Employee engagement Description: Compare employee engagement scores for individuals from monitored groups with scores reported by individuals who are not members of a monitored group.Strength: Useful for identifying whether certain groups of employees are experiencing lower levels of satisfaction and engagement compared with others. A noticeable difference in engagement scores among different identity groups can be indicative of biased mindsets and practices that favor one group of employees over others.Weakness: Existing engagement surveys may not include specific questions relating to diversity and inclusion. Also, existing surveys may not record diversity dimensions, and so comparisons across identity groups are not possible. Further, disengaged employees may not complete the survey, skewing the results.Improvement: Solicit voluntarily disclose by respondents of identity, such as race, culture, sexual orientation, gender, age, parental status. Supplement existing survey items with questions that specifically tap diversity and inclusion concerns. These questions may be incorporated into existing engagement surveys or constitute a separate ‘Inclusion Survey’ or ‘Inclusion Index’. For example;• “Employees are valued for their differences and their unique contributions.”• “Employees can voice their opinions without fear of retribution or rejection.”• “People are rewarded fairly according to their job performance and accomplishments.”• “I have confidence in my company’s grievance procedures.”
Metrics to Consider
Source: CulturePlus
