Historically not a diverse industry, the tech sector appears to finally be taking diversity seriously. Why? The promise of better business results.
Why the tech industry is focusing on diversity
Historically not a diverse industry, the tech sector is making it a priority to hire more women and minorities in tech jobs and leadership roles. Why? The promise of better business results.
A study published in the Harvard Business Review involving more than 1,800 professionals found that companies with the most diverse workforces were 45 percent more likely than their less diverse counterparts to report growing market share on the previous year and 70 percent more likely to have captured a new market.
Similarly, a McKinsey &Company study found that companies ranking in the top quartile for ethnic diversity were 35 percent more likely to outperform those in the bottom quartile.
Lack of talent or lack of opportunity?
Despite such statistics, the tech sector is struggling with a lack of diversity. Some tech leaders cite a lack of talent in the pipeline, given that minorities are under-represented in degree programs such as computer sciences and engineering, compared to their share of the population. Yet others dispute that view claiming it is not a pipeline problem but an industry problem. And ignoring it cuts a company off from a large pool of untapped talent.
Tech companies taking a stand
Recognising this reality, some leading technology companies are investing time and resources to create opportunities and growth for women and minorities. Tech giant Intel has established the $125 million Intel Capital Diversity Fund to invest in start-ups led by women and under-represented minorities, along with committing $300 million to a broad range of diversity initiatives.
Google unveiled its own $150-million-dollar initiative in 2015 to hire more women and minorities, while Apple is investing $50 million to partner with non-profits that recruit talent from universities with a high proportion of African American students. Companies like Facebook and Pinterest have also adopted concepts such as the Rooney Rule, which requires companies to consider at least one diverse candidate for every open senior position.
Forging public-private partnerships
Novel public-private partnerships are slowly opening doors for minorities, and it is in this area that the UK and Europe have much to learn from the USA.
In Oregon, for instance, several public and private organisations have teamed up to create the Elevate Inclusive Fund to invest in early-stage under-represented entrepreneurs in all sectors, including technology. Several cities from Indianapolis to Portland have joined the Equitable Innovation Economies Initiative (EIE), to create inclusive growth in their cities. And in New York the Economic Development Corporation has created a community-sourced incubator to support start-ups, particularly those led by women and minorities.
As the tech sector is recognising, diversity can drive a company’s innovation and financial success. What’s more, shareholders and clients want to see their providers represent the diversity of their customers.
While advancing the technology and attracting talent is the primary goal, at least some companies are discovering that getting to the cutting edge of technology starts with a diverse workforce—and that, too, can be engineered.
This article was first published on JLL Real Views, JLL’s global site providing expert insights on the trends and developments shaping real estate.