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Corporate America Will Keep Moving Forward on Diversity, Sustainability

US companies will face less pressure to be more sustainable or diverse across the next four years but many are going ahead anyway, as that's what a majority of their global customer base and workforce demands

While the business community will almost certainly face less pressure from the Trump administration to take action on matters of diversity or sustainability than it did from the Obama one, that doesn’t preclude companies doing so voluntarily.

Slate columnist Daniel Gross predicts that when it comes to diversity, gender equality, and environmental sustainability, businesses “may well remain [progressive Americans’] most prominent hope”. He offers numerous reasons for this:

“On sustainability, for example, most large companies are much more citizens of the world than they are of the United States. S&P 500 companies earn about half of their revenue from abroad. And for the very largest companies — Intel, Microsoft, McDonald’s — the number is closer to 70% or 80%. So whether the CEOs believe in climate change (most of them do) or whether the president of the US does, they have to operate in a context in which climate change is a reality and the pressure and imperative to reduce emissions are intense.”

He goes on to point out that what corporate America cares most about is having, “the best possible people to do the job … In the US, women are more than half the workforce and more than half the college graduates. Perhaps the Trump administration will be able to staff up with few women. But companies can’t. If you need the best people, you can’t afford to ignore or denigrate women, or to make the workplace inhospitable to them.”

This is all backed up by Andrew Winston in the Harvard Business Review, who adds that talent considerations weigh on corporations’ pursuit of sustainability as well, as a commitment to sustainable growth helps them attract and retain millennials.

Companies are Tackling Social Policy

These two writers are not the first to notice how companies are taking the lead on advancing social policy, and it’s not just about D&I (diversity and inclusion) and environmental sustainability. Although the US Congress has not shown much interest lately in raising the federal minimum wage or enacting a parental leave mandate, companies are increasingly recognizing a need to raise their own wage floors and expand their own parental leave policies to compete in tight labor markets, and to attract and retain crucial cohorts of employees.

Just look at some of the steps businesses have taken recently: JPMorgan Chase adopted a $15 minimum wage for its retail banking employees, Allstate did the same for its corporate workers, Walmart experimented with a new scheduling system to give employees more certainty about their shifts, companies like SAP and Microsoft hiring employees on the autism spectrum, and others revamping background checks to give candidates with criminal records a fairer deal. That’s not to mention the deluge of organizations that have recently introduced or expanded parental leave.

Even if President Trump changes or eliminates certain Obama-era regulations, employers may well choose to act in the spirit of those regulations anyway. For instance, the rule change adopted by the Labor Department to raise the threshold at which salaried employees become exempt from overtime pay may not survive the new administration.

To some employers, that will represent an opportunity to create de facto social policy on the ground by saying, “No, we are keeping it at a higher level because it is the right thing to do.” In the age of HR as PR, these companies may find that the business benefits of voluntarily paying more overtime outweigh the costs.


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    This post was originally published on CEB Talent Daily, a provider of daily news and analysis on the world of talent management.

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