Over the past few years, companies have begun putting their money where their mouths are for DEI. According to a survey of diversity executives from Traliant, 79% of organizations said they would increase their DEI budgets in 2022. This is proving to be more than just a trend; organizations don’t look like they’re slowing down their DEI spending anytime soon. A market study published by Global Industry Analysts, Inc., a market research firm, estimates that global DEI spending will increase from $9.3 billion in 2022 to $15.4 billion a year by 2026.
Even with a possible recession on the horizon for 2023, this is not the time to slow down your requests for DEI initiatives, especially since corporate boards and accountants do not want to appear as obstacles to progress.
Presenting Your DEI Budget Request
Don’t be scared to ask – Markita Jack, vice president of DEI at Iterable, a cross-channel marketing platform, has found that diversity leaders can be shyer about making budget requests, especially compared to straight white male peers leading other departments. “If others at your company are shooting for the stars with their requests to get the moon, don’t be afraid to do the same.”
Go in with a plan – Kelly McDonald, founder of McDonald Marketing and a leading DEI author/speaker, says you should treat your DEI budget request like any other part of the business. “You wouldn’t go into a marketing meeting asking for another $500k without some sort of marketing plan.” Prepare to explain how you would use the money and the expected outcomes, even if they’re just rough estimates.
For example, you could predict that further spending on Employee Resource Groups (ERGs) could reduce turnover by 10%, based on positive feedback and employment trends since you started your first program. To add weight to your presentation, McDonald suggests collecting quotes from employees showing their support.
Be mindful of your company’s finances – While many companies are increasing their DEI budgets for 2023, not all will be in the position to do so, especially if the economy falls into a recession. Jack says be aware of your company’s situation. “If your company is asking for every department to make a 10% cut, it could come across as tone deaf to pitch a DEI budget increase.” Instead, she recommends going in trying to preserve whatever spending you’ve already received and trying to prevent cuts.
Stress a long-term focus – If your board is on the fence about your DEI budget, Jack says to remind them about the long-term needs of the company. “You can’t wait until you’re hiring to start building connections.” By then it’s too late. If funds are tight, consider a compromise. “Maybe you don’t go to every conference or event you had planned, but it’s important to show up to some and have some representation.” This investment will pay off when the economy rebounds and your company wants to hire again.
Consider bringing in a DEI consultant – Nance L. Schick, an employment attorney and DEI trainer with Third Ear Conflict Resolution, suggests bringing in an outside DEI consultant. “They can analyze the budget and help you focus on what works for your business.” This consultant could also provide referrals for the services planned in your budget, like a local DEI trainer to run classes.
By focusing on these strategies, you can get the DEI budget your organization needs to be a leader in 2023 and beyond.
Senior Executive DEI Think Tank is a criteria-based membership community for chief diversity officers and senior-level DEI leaders at large organizations to share difference-making tactics, trade valuable resources, and seek the counsel of experienced peers in a private, confidential setting.
Do you qualify?2023 DEI Budget Requests
Increased DEI investment is crucial for your company’s bottom line. DEI author/speaker McDonald says that now that companies are seeing the tangible benefits of DEI investments, they are unlikely to slow down. “It’s like technology. Companies don’t just spend on it once or twice and stop. It’s the same with DEI as a business tool.”
Jack agrees and thinks it would be risky for companies to slash DEI spend given how valuable these programs can be to employees and the tight labor market. “Employees are a lot more vocal and aren’t afraid to speak out,” pointing out Twitter employees criticizing Elon Musk as an example.
If you’re preparing your DEI budget ask for 2023, here are the types of requests fellow savvy corporate diversity leaders have gotten approved.
1. Invest in DEI Data and Surveying Tools
Kevin Walters, senior director of diversity and inclusion solutions at SilkRoad Technology and Senior Executive DEI Think Tank member, notes the importance of investing in data collection tools to measure the impact of DEI projects. He is currently researching which tools to invest in for 2023. “[For success metrics] we’re really looking at measures of participation and engagement. We’re looking at some diagnostic tools that will help us really pinpoint areas within some of the gaps and opportunities that we may have and help us to measure from a learning standpoint, where there are opportunities for these particular leaders or individuals to be better in their learning curve.”
2. Join Professional Development Organizations
Wil Lewis, global chief diversity, equity, and inclusion officer at Experian, recommends joining national councils and organizations, which can help to inform the company’s annual strategy. He’s part of several organizations including the Chicago Minority Supplier Development Council, Disability:IN, and the National Disability Institute. He’s also a member of New Horizon Center – Chicago, a nonprofit focused on early childhood education and foster care.
“Being a part of these boards keeps my finger on the pulse of what’s occurring out in the world today. If we’re going to drive change, if we’re going to make difference and impact, all of us as humans cannot stay just focused on our own little silo. Instead, we really have to take an opportunity to go and be close to the individuals that we purport to support,” says Lewis.
3. Support Local Organizations Investing in Minority Communities
McDonald suggests clients put a portion of their DEI budget towards a local organization supporting minority communities, especially groups underrepresented at their company. This could include setting up a scholarship for an HBCU or donating to a community center or charity. Not only will you help your company’s reputation, you’ll build important local ties for future recruitment.
4. Visibly Show Your Support
Lewis advises showing support by providing resources to employee resource groups. “Our [2023] budget will be focused on two things continuing to drive this culture of belonging inside the organization. We’ll do that through our employee resource groups, being sure that we give our employee resource groups the tools they need to be successful as well as helping employees know how to join them, and the second thing is really around driving efforts on products for consumers and customers.”
McDonald also advises leaders to think of ways you and your employees can directly support underserved communities. For example, your company could give a paid day-off to employees for volunteering at the organization you sponsor.
5. Invest in DEI Conference and Event Attendance
One investment that Jack has found helpful is paying for diversity leaders to attend popular DEI conferences and events, such as the DEI Summit in Memphis. “It’s a chance to share collective knowledge across industries and learn how to push our organizations.” For further visibility, you can ask your organization to sponsor conferences like these on top of sending attendees.
For example, Experian is sponsoring an Out & Equal Executive Forum in February to bring together LGBTQ+ and senior executive allies, and UnitedHealth Group is sponsoring The Conference Board’s Diversity, Equity And Inclusion Conference in June to connect DEI leaders.
McDonald advises clients start with educational investments. “I have seen companies move straight into building a more diverse infrastructure. Without education and many chances to ask questions, learn and understand, it’s easy for employees to dismiss diversity efforts as political correctness, and the ‘flavor of the month’ company initiative.”
If your company has a set budget for ERGs, consider buying tickets to a Pride Festival as a raffle prize for employees who participate in DEI initiatives. Offering employees opportunities to attend DEI events creates professional development opportunities while also demonstrating your company’s commitment to DEI.
6. Host an Organization-wide DEI Event
Employment attorney Schick advises clients host their own event, such as a company diversity week with training and celebrations for different ethnic/cultural groups. To host events that resonate, work with your ERGs to determine what type of events employees are interested in. For example, Experian’s Black ERG, Karibu, is planning activities to honor MLK Day with the support of an executive sponsor.
