Manav Rihel Kumar
CEO, Seema
6 March 2025
DEI built on a dubious foundation becomes an easy target. This is an opportunity to get things right.
We have been following the DEI-movement for two decades. Even though our expertise comes from the Nordic context, we have always glanced at other countries to understand the DEI landscape. That is why we are very interested in the political shifts happening around the world and how they affect organisations. Our primary focus is to enable organisations to include and utilise differences for value generation.
Before starting, it could be wise to separate DEI from diversity. To us, DEI is the movement that societies and organisations participate in to achieve political or societal ambitions. Diversity is the differences we find between people. This means no one is diverse in themselves, but diversity occurs as soon as two people interact.
Having worked with diversity topics for the last ten years, we see that most organisations have good intentions at heart. They truly want to contribute to creating inclusive workplaces where everyone can thrive and perform at their best. And they want differences to become a source of prosperity and innovation. However, they fail at navigating some very fundamental aspects of diversity science.
This is why we believe that the DEI backlash could be a golden opportunity for organisations to reset and get the fundamentals right. As Winston Churchill once said: "Never let a good crisis go to waste". In this article, we highlight two fundamental errors and suggest, based on our experiences, three paths for moving forward.
Failing to define diversity in a way that captures everyone.
When organisations work with diversity, they usually select one or two groups on whom they want to focus efforts. For example, gender and race. As a result, diversity becomes about a selected few instead of being a unifying project across differences, whatever they may be. When diversity is approached in this way it fortifies in-group and out-group thinking - the biggest problem in diversity science (and one of the biggest challenges generally in social psychology).
When we examine diversity in organisations, we see that around 35-45 % of employees feel that they are in a minority position in one or more ways. For example, being the one economist among engineers, having a lower socioeconomic background than colleagues, or being a Christian among other or no religion. The point is not to dilute the term, but to show that "feeling different" is universal and something that everyone can relate to. This creates a deeper understanding of the term and a platform for dialogue. Furthermore, it sparks curiosity about who one's colleagues really are, and which parts of themselves they believe come with privileges and liabilities.
The most effective way to break in-group and out-group thinking is through exposure to nuances and emotional connection. Seeing yourself in the other through empathy (not sympathy) is a good starting point.
Failing to get the diversity paradigms right.
We often hear that organisations want to be diverse because it is good for value generation. However, we seldom see that there is a clear link between what the organisation says and does to harvest this value. In 1996, David Thomas and Robin Ely wrote to Harvard Business Review (HBR) about the need for a paradigm shift when working with diversity. They wrote about it again in 2020, saying that nothing had changed since their first article. From our perspective, the same is true in 2025.
Simply put, working with diversity can be done in three paradigms:
1) The discrimination and fairness paradigm
2) The access and legitimacy paradigm
3) The learning and efficiency paradigm
The first paradigm is about taking social responsibility through a more diverse staff and avoiding discriminatory systems and behaviours. The second paradigm focuses on reflecting society inside the organisation in hope of becoming more accessible for the market and its people. The third paradigm targets utilising diversity of people and their perspectives for achieving strategic aims and business goals.
Even though one can argue that all paradigms have their pros and cons, paradigm 1 and 2-thinking come with a multitude of adverse effects. To name a few, we tend to regard people as less resourceful if we feel sympathy for them. We also tend to look down on people that have been given "special treatment" to achieve representation at various levels of the organisation. It does not even have to be true - the mere presence of such a narrative is sufficient for the adverse effects to occur. Confusing equitable opportunities with equal outcomes is also a slippery slope for most.
The problem is exacerbated when organisations say they are working with diversity to get a competitive advantage (paradigm 3), but all performed actions are based on paradigm 1 and 2-thinking. This creates dissonance and overall reluctance to buying into the narrative. As the authors of the HBR article bluntly state: "The staff, one might say, gets diversified, but the work does not".
Many authors have voiced that it is time to scrap the business case for diversity. We do not believe that is a good approach. More will argue that one paradigm builds on another. That is rarely correct: Societal issues seldom translate into an organisation, even less represent the recipe for business success of any organisation. Getting the paradigms right is crucial to rebuild trust in DEI. There must be a credible link between what the organisation says and does according to a paradigm 3 logic.
How to move forward?
Diversity is not going away. Even though political tides are shifting, we live in the world we live in - with its multitude of interpersonal differences. Organisations will continue to depend on attracting and retaining talent from diverse search pools, and the need for diverse perspectives, innovation and market competitiveness is never-ending. Perhaps the DEI approach up until now has been flawed and easy to discredit at the stroke of a pen. As this article implies, it is time to take two steps back and reset the DEI approach to its original intention: Tearing down walls and building bridges across differences to achieve greatness together. Based on our experiences, we see that the following three steps resonate well with organisations.
1) Separate categorical diversity from diversity of perspectives.
We are not ideological about diversity. This means we believe organisations' primary goal should be to thrive and stay profitable. Some organisations are better off with conformity because the tasks they perform are repetitive and seldom change significantly. Other organisations need diversity of perspectives to stay competitive in a complicated market. However, in both scenarios, you end up with categorical diversity (gender, ethnicity, neurodiversity, religion and so on). The best people who think alike come in all shapes and sizes, and the same goes for people who think differently.
In fact, based on 6,100 datapoints form 8 organisations, we find only a r=0.31 correlate between being categorically different from colleagues, and thinking differently from colleagues. This does not mean categorical diversity is not a source of thinking differently. It just means that organisations have not regarded it as such.
Organisations that manage to separate the two have a better chance navigating the paradigms listed above. They are also less afraid to explicitly utilise categorical diversity as a source of diverse perspectives when it is relevant.
2) Connect diversity to the strategy and focus on diversity competence.
Any organisation will protect its core business when facing challenging circumstances. If DEI initiatives exist external to core business, they will be removed as soon as the organisation needs to prioritise what needs to go.
We often say that diversity should be regarded as a resource factor alongside finance, infrastructure, technology, and so on. In almost every organisation, there is a link between diversity and achieving business goals. But it requires some extra effort and understanding to figure out. And it demands a pivot from focusing on diversity representation to focusing on diversity competence.
For an organisation in the public sector, it could be about designing and delivering services that are relevant to the population. For an organisation in the private sector, it could be about understanding and capturing new markets through product development and targeted marketing. Once an organisation explicitly states how diversity is going to support the business it becomes easier to define as a competence, and, to champion.
Not for the sake of diversity itself, but because of what it does to improve business.
3) Identify matters relevant to the organisation and train on mastering them.
Much too often, we see that research from the other side of the globe (US-based research, that is) is used as hard facts when designing DEI measures for the organisations here in Europe. And standardised training on unconscious bias is considered the most cost-effective way to improve matters. Every organisation is unique with its own diversity composition, culture, context, ambitions, systems, procedures and so on. Just because something worked for a tech-company in Palo Alto does not mean it will translate to your clothing factory in Hamar (a small city outside Oslo, Norway). But many organisations end up training on the wrong things because of this blindness to context.
If an organisation clearly states what it wants to accomplish with diversity, it becomes easier to identify barriers in the organisation's culture for getting there. Many rely on employee engagement surveys when trying to figure out what to do. But they (most often) fail because the test battery is not specifically designed to capture blind spots in the organisation, viewed through a diversity lens.
We always encourage using reliable data and statistically sound methods to uncover the realities of the organisation and design DEI measures based on that. Some organisations may struggle with categorical diversity and creating acceptance across cultural differences. Others may find that the cost of thinking differently is too high - and that people are excluded if they deviate from social norms local to the company. In a different organisation, the organisation could be struggling with inclusion regardless of diversity (a conflicted culture in general).
Consequently, DEI training should address the specific pain points in the organisation - based on data from the organisation.
Diversity is the organisation's natural state. DEI is what you do about it.
One might argue that the current backlash is overdone and completely out of proportion. From an ideological standpoint that might be true. But from an organisational perspective, nothing should have changed. Organisations should be driven by what is good for business and diversity will continue to be the natural state of things, regardless of national/international politics and societal movements.
Right now, it is easy for leaders to say the right things to get a short-term moral high ground. But tomorrow's winners won't be the ones who use the old recipe for DEI anyways. It will be the ones who seize the opportunity to rethink how things are done and connect diversity to the business.
We encourage you to read about Jesper Køster, Bank Area Director in Spar Nord Køge Bugt (a Danish bank), and his experiences with connecting diversity directly to value generation.
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