inclusion

Follow the ARC to Be a Great Ally

I spend a lot of time thinking and talking about allyship. One of the main things an ally should do is advocate for others. An ally is your voice when you’re not in the room. When I do a training and I’m talking about allyship, one of the tools are used to provide a framework for speaking up, is Follow the ARC.

ARC Method.png

If you happen to overhear a comment that you feel is harassing, potentially harassing, borderline offensive, or any other form of micro-aggression, it’s important to speak up as an ally. That is one of the key elements of inclusive leadership. But how do you speak up when you witness such a thing? Follow the ARC.

ARC. ARC stands for Ask — Respect — Connect, and provides a tool for difficult conversations. We created the ARC here at Equality Institute to help others approach these conversations from a place of curiosity, not confrontation, reducing the risk of defensiveness from the other party.

Let’s use a real world example of micro-aggression that you may overhear at work: “LGBTQ? What’s the Q? And what’s next, X, Y, and Z?”

Start with the A: Ask. Again, ask from a place of curiosity.

Allies ask good questions when they follow the ARC. And context matters. The place you approach the conversation may depend on your relationship with the person - perhaps you may choose to pull the person aside to follow the ARC privately. Perhaps, if it’s someone who is half-joking or says, “I’m just joking!”, then approach them with a joking-back tone. To be successful with ARC, the place matters and your tone matters.

Here are some conversation starters for the Ask using the example above.:

“The Q means Queer, which used to be hurtful but is now an umbrella term - but

  • “can you explain what you meant by X, Y, and Z? I’m super confused!”

  • “did I hear you correctly when you said X, Y, and Z? That would be weird!?”

  • do you mind if we talk about your LGBTQ X, Y, Z comment? I don’t get it.”

  • “did you mean to say LGBTQ XYZ? I may have misunderstood.”

Again, stay in the space of curiosity, not confrontation.

These questions challenge the person to explain themselves, and possibly realize how silly and/or offensive they may have been. As they explain themselves, follow up with the R - Respect. Simply put, respecting means being an active listener. Don’t cross your arms, nod your head, and use verbal cues to indicate that you’re paying attention. Don’t dismiss what the other person is saying. Respectfully listen without interruption. Paraphrase and validate.

After you’ve listened and respected the other person, close the arc with the C - Connect. In the ARC, Connecting means to paraphrase and validate. Here are some ways to connect using the example above:

  • “Ah yes, you’re saying that the letters are confusing. That’s what I used to think, too…

  • “OK, just so I’m clear, you don’t really think there’s an XYZ, just that there are so many letters? I get why you would say that but…”

  • “So I understand you correctly, you think the letters are over-kill? I remember thinking that, but…”

Now, the other person may still get defensive or begin debating, so go back to the start of the ARC. This can be a cycle and you can’t expect to change “hearts and minds” with every person, but it does have a powerful ability to “call someone out” and gently challenge them to reflect on their word choice.

Allyship is a key component of inclusive leadership and we all have the ability to use our words.

Giving Everyone a Voice: Best Practices for Inclusion

Diversity, while important, means nothing without giving those diverse folks a voice in the workplace – without making those diverse voices feel included. There are numerous ways to create inclusion, but they must have strong buy-in from leadership.

To create inclusion, it’s important to first understand the concept of “covering.” In its 2013 study Uncovering Talent, Deloitte explained why true inclusion is elusive: “The ideal of inclusion has long been to allow individuals to bring their authentic selves to work. However, most inclusion efforts have not explicitly and rigorously addressed the pressure to conform that prevents individuals from realizing that ideal.”

That pressure to conform is “covering” or hiding parts of us to avoid stigmatization. Deloitte found that an astounding 61% of workers cover parts of themselves at work, including 45% of straight white men. People may hide elements that could draw unwanted attention to their race, religion, health, parental status, political party, and so forth. And when people can’t fully be themselves at work, they under-perform.

How do we create a workplace where the pressure to cover is minimized, where people can truly feel like they belong and can bring their full selves to work? Here are five best practices:

1.    Create psychological safety. Truly inclusive work cultures have psychological safety. This means that people feel safe enough to bring their ideas to the table without fear of rejection from their team. They feel safe enough to take risks. One way to create psychological safety is for leaders to demonstrate this themselves, to show genuine emotion and be vulnerable enough to admit failure, talk about their own fears, concerns, and areas to improve. Google conducted a two year internal study and found that the number one indicator of high performing teams is psychological safety. This really matters.

You can start small to create psychological safety. One health care organization asks employees to smile and greet anyone who comes within 10 feet of them. That’s a small, actionable habit that creates a welcoming environment at work.

2.    Train your team on unconscious bias. Trainings are safe places for people to learn how to behave, and then truly understand that DEI strategies are financially prudent and good for them as leaders. A comprehensive training on unconscious bias, the science behind it, and how to reduce it can go a long way towards better understanding and then empowering the whole team.

3.    Create a DEI council or committee. The goal here is to enlist leaders who will use their seniority to advocate for DEI initiatives. Involve 8-15 volunteer leaders from all parts of the organization, especially those with a large span of responsibility. Their role will be to educate themselves, then drive and inform DEI strategy and initiatives, particularly advocating to the “resisters” at the firm. These council members are not subject matter experts nor a stand-in for a paid DEI team.

4.    Create or strengthen Business Resource Groups (BRGs). Your firm may already have BRGs (also known as Employee Resource Groups or ERGs) – the women’s group, the veteran’s group, the LGBT group, etc. These groups are important spaces for employees to connect with one another while also supporting the firm’s business goals. BRGs should always have a business imperative, which can lead to them being more highly valued by leadership. BRGs should each have a unified strategy, even when there are chapters in different offices. BRGs are an important space where employees can find their voice and sense of belonging in the workplace.

5.    Develop sponsorship programs. Sponsors are senior executives who directly enable their protégées with career advancement, and increase objective career outcomes. Deloitte embedded sponsorship in its culture after a pilot program that paired women in a leadership training program with an executive sponsor. Within a year, nearly all participants had received promotions. You can start small with a sponsorship program, even beginning with one department as a pilot.

Kelly Rau from KPMG wrote in the 2018 Prequin Investor Study, “It also takes having senior men in our industry to sponsor women and help them progress inside of their organizations. Given the number of firms that are run by men, it is vital they be involved, to enable this process to happen much faster.”

This work is not easy, but it’s important to make your firm a more attractive place to work, to reduce turnover, and increase revenue by better understanding the market.

How to Make the Business Case for Diversity and Inclusion

“Women account for less than 10% of senior positions in the private equity industry: a lower proportion than that of other alternative asset classes with no apparent reason. In an industry so vast in terms of investment opportunities and nature, any increased diversity – not just in gender – in management should be of benefit to the whole industry,” shared Sandra Legrand of Alter Domus in the 2018 Preqin Investor Survey.

We know you aren’t surprised by this statistic in only one industry – the fact that you’re reading this article reinforces that.  We believe it doesn’t have to be this way.

The need for diversity and inclusion may seem obvious to us, but perhaps it's a harder "sell" to the powers that be. Here are some strong selling points to make the case for diversity and benefit your bottom line.

You'll better understand the needs of your target client.

When a workforce is diverse, that talent has a broader understanding of the needs of their diverse clients. Naturally, when an organization better understands the needs of its target market, they can better innovate their products and services – and that leads to an increase in revenue. 

According to their 2016 analysis of more than 20,000 global firms, McKinsey found that companies leading in executive board diversity had returns that were 53% higher than others. Organizations with high rates of female executives are also more profitable.

McKinsey & Co also found that companies that exhibit gender and ethnic diversity are, respectively, 15 percent and 35 percent more likely to perform better than those that don't. Their research shows that organizations with more racial and gender diversity also have better sales revenue, more customers and higher profits.

 

You'll save money in employee turnover.

Diversity is either a sexy or terrifying word, depending on whom you’re talking to – but there’s no doubt that it matters. Not only can comprehensive DEI strategies lead to higher revenue, but they can also save companies money in employee turnover.

35% of the workforce is made up of Millennials, those who most value diversity. Generation Z is bigger still - and right behind them. We must pay attention to their needs. 66 percent of the millennials (including 57% of those in senior positions) expect to change jobs in the next five years, according to Deloitte’s 2016 Millennial survey. And, according to GlassDoor.com, 67% of job seekers said that a diverse workforce is an important factor when evaluating companies and job offers.

All this, yet many large firms still don’t have comprehensive diversity and inclusion policies in place - and many do not have paid staff dedicated to this opportunity.

“Part of this conversation is about the bottom line and superior returns, but I think part of it is also about the extraordinarily talented female portfolio managers that exist. If the conversation and the need for diversity is not being talked about and prioritized within their firms, then those top talents will find firms where diversity is a top conversation” Kelly Rau, Audit Partner, KPMG, wrote in the 2018 Preqin Investor Survey.

 

You'll create champions of your brand. 

While diverse teams are important, a comprehensive diversity, equity, and inclusion strategy is necessary to truly reap financial benefits. Diversity is the people: the mix of everyone on the team. Inclusion is the strategy of ensuring the diverse mix of people feel welcome, are given a voice, and permission to truly be themselves at work. Without comprehensive inclusion strategies that include buy-in from leadership, diversity is ultimately shallow and employees will leave.

According to Gallup, ”Companies with highly engaged workforces outperform their peers by 147% in earnings per share.” An engaged, included workforce means that employees can express their passions at work, allowing them to effectively be champions of projects that will ultimately advance the company’s mission. Their passion leads them to be agents of positive change within the company.   

Even companies like Johnson & Johnson, Prudential, and Kellogg that pride themselves on their heritage and tradition are prioritizing diversity, equity, and inclusion (DEI) strategies and are now considered among the top 50 Companies for Diversity, according to DiversityInc.

Diversity and inclusion work has to be authentic and you can't just check boxes -- or it won’t work. You now know some of the facts on why diversity contributes to the bottom line, next we'll show you HOW to implement a program that is genuine, authentic and truly drives results.

This work is hard but the rewards are great. With authentic investment from leadership, and a comprehensive DEI strategy, private equity firms will see benefits that go far beyond increased revenue. In the next three articles, I’ll share tips on how to set a comprehensive DEI strategy.