Organizations need to be more transparent about their progress on racial justice

This article is brought to you thanks to the collaboration of The European Sting with the World Economic Forum./

Author: Richard Edelman, CEO, Edelman

• There is a disconnect between executives and employees on racial justice progress.
• Employees are more likely to believe that their organization is doing enough to address racial justice issues if they see it taking tangible steps to do so.
• Organizations should be willing to share data and metrics on their progress, and they should be open to feedback from employees.
• Organizations should create a culture where employees feel comfortable speaking up about racial issues, and where there are clear consequences for discrimination and harassment.

Edelman’s fourth year producing the Trust Barometer Special Report on Business and Racial Justice reveals a serious failure of leadership to execute on the promises made in the wake of the murder of George Floyd in Minneapolis in May 2020. Concerns about racism in the U.S. are escalating, with 69 percent of Americans worried about racism, up 8 points from the 61 percent last year — the highest since the 79 percent registered in our June 2020 report.

None of the major institutions, from Business to Government to NGOs to Media, are trusted by a majority of citizens to solve the problem of racism and racial injustice. No industry sector is seen as doing well in this regard, with the worst performing sectors being financial services (33 percent) and pharmaceuticals (37 percent). The findings from our 2023 Edelman Trust Barometer in January told us that our leaders are seen as divisive instead of healers; by a three to one margin, government leaders are seen as pulling us apart instead of unifying us.

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Our present data drives home a grim irony: We need tangible action to drive real change and leaders are blocking progress.
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Importantly, there is a profound disconnection between the executive team — executive director levels and above —and the rest of the company on racial issues. Here are the harsh truths from our study:

1. Executives Believe There Has Been Meaningful Progress; Non-Executives Do Not – Sixty percent of executives believe their companies have made major strides in addressing racism in the workplace. Only 28 percent of mid-level employees, or associate managers to senior vice presidents, and 18 percent of associates, or entry-level employees and experienced non-managers, see a lot of meaningful progress.

2. Executives Do Not See the Benefits of a Diverse Workforce – Only 39 percent of executives see that diversity brings a better sense of belonging, only 31 percent believe diversity enhances innovation, and just 31 percent think it helps build trust with customers. Associates are at least 10 points more likely to see the benefits of diversity across all three domains.

3. Employees Say That Leadership Decisions Hold Up Progress – For the 57 percent of employees who said their company isn’t making much meaningful progress on racism at the workplace, the main reasons cited were an under-resourcing of the Diversity, Equity, and Inclusion (DEI) function, an under-prioritization of racial equity, an unclear explanation of the benefits of DEI, and bowing to outside pressure.

4. Executives See Racism as an Individual, not Systemic Problem – Nearly two-thirds of executives agree the biggest challenge in addressing racism is to change the attitudes of people who are racist, and only 35 percent see the task as solving systemic racism; associates are 11 points more likely to say that systems are the biggest challenge. Executives are more likely than associates to think of Affirmative Action as about serving quotas rather than using race as one of many hiring or admissions criteria.

5. Executives Are Uncomfortable Speaking About Race – Sixty one percent of executives are uncomfortable talking about racial issues with people of other races because they are worried that they might say something racist.

The result of the disconnect is a stunning rejection of the C-suite as a credible voice on DE&I. The CEO is trusted to tell the truth about racism in their company by only 15 percent of associates. Only 28 percent of associates trust their direct supervisor to tell the truth about racism. The trust abyss on racism in the company is similar for the mid-level employee, only 24 percent trust the CEO and 31 percent trust their direct supervisor. Indeed, the only group that does trust the CEO in this regard is the executive class.

This is a call for help and a demand for action. The steps business must consider taking are:

• Develop a strategic framework: Follow the lead of the sustainability movement and create a national framework like the SBTi, with three clearly defined scopes around company progress, supply chain management and activity in the community. While some standards have been developed, there isn’t yet a widely followed framework providing collective alignment and consistency.
• Stand strong: The DEI commitments made and goals set over the last three years must be maintained and accelerated; nearly 2 in 3 respondents say companies are doing mediocre or worse living up to their commitments. Real progress will require continued focus, leadership support and significant resources.
• Build an infrastructure for listening: Create spaces and forums to hear from each other to understand the diversity of employee experiences and to understand sentiments. Leverage the fact that nearly half of employees most trust people like themselves to tell the truth about racism within their organization.
• Get educated and informed: Increase awareness and cultural competencies for leaders and employees through listening sessions, immersions, unconscious bias and other trainings. Commitments falter when they’re only a temporary response to pressure. Leaders need to update their worldviews to drive actual, meaningful change.

In sum: We need to recommit to action and recognize racial justice and DEI as the most important trust challenge for Corporate America. In our 2023 Edelman Trust Barometer global report, we found that My Employer is trusted more so than any institution at 78 percent, leading Business in general at 62 percent, NGOs at 59 percent, government at 50 percent, and media at 50 percent. It is key that it takes this license and puts it to good use by driving real change across their organizations and America.

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