Recent DEI research shows that 78% of American workers believe working for an employer that values diversity and inclusion is important. Meanwhile, 89% of companies have a formal diversity, equity, and inclusion (DEI) strategy. And that’s why you need a comprehensive diversity and inclusion budget for your business.
So, if your company doesn’t have a diversity and inclusion budget yet, it’s time to create one. Keep reading to learn more about how prioritizing diversity, equity, inclusion, and belonging can benefit your company.
What is a diversity and inclusion budget?
A DEI budget is money that’s allocated to promote projects in the workplace centered on diversity, equity, and inclusion. So, a good DEI budget sends the message that your company is committed to making positive changes in the workplace to create a sense of inclusion and belonging for all.
No two DEI budgets are the same. But, the most successful diversity and inclusion budgets are tailored to address the unique needs and challenges of your company. So, this means you need to identify areas you want to improve so you attract top talent to your company.
If you’re looking for inspiration, Netflix, Amazon, and Paypal are 3 companies known for their successful DEI budgets. These companies prioritize diversity because they know that for customers to be attracted to their products, inclusion has to start from within.
Benefits of a DEI budget
There are numerous benefits to a targeted budget and effective DEI strategy :
Increased employee satisfaction – By investing in DEI initiatives, you help create a more inclusive and welcoming workplace culture. So, this leads to increased employee engagement, productivity, and satisfaction.
Enhanced reputation – Organizations that prioritize diversity and inclusion enhance their reputation, which in turn improves brand recognition and attracts customers or partners with shared values.
Better recruitment – A DEI budget will allow you to improve your recruitment efforts, reaching a larger pool of employees.
Increased innovation – A company that supports its underrepresented employees creates an innovative work environment. So, besides fostering creativity, this helps workers develop a growth mindset by making them feel comfortable sharing their ideas and setting them up for success.
Avoiding discriminatory practices – Providing training to employees at all levels will reduce the risk of discrimination in the workplace, contributing to a positive company culture.
Higher employee retention – A DEI budget is an important tool in any employee retention strategy. When all employees feel supported at work, higher employee retention likely follows.
How to create a diversity and inclusion budget
So now that you know why you need a DEI budget, where do you start? Here’s a list of steps to take:
1. Conduct a diversity audit
Using tailored assessments, diagnostics, and analyses helps you to better understand the demographics of your employees and target potential areas for improvement. Therefore, this will allow you to re-think policies, discuss new strategies, and tweak your approach. So, instead of guessing which areas need to be improved, your DEI strategy will be backed by numbers.
2. Establish goals
Once you’ve pinpointed the areas of improvement, you need to create achievable goals to address them. So, involve employees and other stakeholders in the goal-setting process. This ensures the goals you set are aligned with the organization’s values (and are achievable).
Some examples of actionable diversity goals include:
- Creating employee resource groups (ERGs)
- Hiring a DEI consultant
- Developing training programs
- Creating unbiased job ads
- Investing in assistive technology
- Planning recruiting events and attending diversity job fairs
- Supporting community engagement initiatives related to diversity and inclusion
- Attending DEI events
3. Allocate funds
Once you’ve listed all your goals, it’s time to allocate funds. So, assess your available resources and decide how much you need to spend to achieve each goal on your list. Therefore, how much money you set aside for DEI initiatives will depend on the specific needs of your organization.
4. Track your progress
After your company has implemented a DEI budget, you need to keep track of the progress being made to achieve the budget’s goals. Because you conducted a diversity audit, you’ll have a baseline to compare your progress.
Some examples of metrics to keep track of include:
- Number of employees involved in ERGs
- Employee retention rate
- Staff satisfaction rate
- Team diversity
- Job applicant and new hire diversity
5. Review and update as necessary
If you notice that your plans aren’t moving along as you thought they would, it’s time to reassess. The whole purpose of a DEI budget is to promote and celebrate inclusion and diversity of all kinds in your company. So, it’s important to pay attention to areas where the results aren’t living up to your expectations.
Sample diversity and inclusion budget
To help you visualize what your budget should look like, here’s a DEI budget example for you to model your own on:
Free DEI budget template
To make the budgeting process easier, here’s a DEI budget template you can copy/paste to get started:
[Company Name] DEI Budget 2023
DEI Goal 1
- Sub-goal #1 (sub-goals should contribute to the overarching DEI goal)
- Sub-goal #2 (prioritize sub-goals based on the potential impact on DEI outcomes)
- Sub-goal #3 (include an exact dollar amount for each sub-goal)
DEI Goal 2
- Sub-goal #1
- Sub-goal #2
- Sub-goal #3
DEI Goal 3
- Sub-goal #1
- Sub-goal #2
- Sub-goal #3
Total DEI Budget: [Insert amount]
How To Get Approval For Your Diversity and Inclusion Budget
Creating a diverse and inclusive workplace is important, but sometimes getting the budget you need to make it happen can feel like a challenge. Don’t worry, though, we’ve got you covered.
So, here are some steps you can take to convince your higher-ups to invest in DEI efforts:
Calculate the ROI for Your Diversity and Inclusion Budget
First things first, let’s talk numbers. One way to get your executive team on board is by showing them the business case for diversity and inclusion. You can do this by calculating the return on investment (ROI) of DEI initiatives. So, show them how investing in DEI programs can lead to a more diverse workforce, better employee retention, and increased innovation. All of these things can have a positive impact on the bottom line.
Get Feedback for Planned Diversity and Inclusion Budget
Next, it’s important to get feedback from your team members. So, conduct surveys or hold focus groups to gather insights on what DEI initiatives they think would be most effective. Thus, involving your staff in the decision-making process shows them that their opinions matter. Also, it helps you to gather valuable information that can help you make a stronger case for your executive team.
Develop Allyship Programs
In addition, allyship programs are a great way to get everyone in your organization involved in DEI efforts. These programs encourage employees to actively support and advocate for underrepresented groups. So, by demonstrating a commitment to allyship, you can show your executive team that DEI is a priority for the entire organization, not just a select few.
Spend Time on 1-on-1 Talks With Staff
Another effective strategy is to spend time having one-on-one conversations with your staff. Therefore, you must listen to their concerns, answer their questions, and explain why DEI is important to you personally. So, building relationships and showing empathy helps to create allies who will support your efforts to secure the budget you need.
Understand Your Why
Finally, make sure you understand your “why.” Why is creating a more inclusive workplace important to you? What impact do you hope to have? If you can articulate your passion and commitment to DEI, you can inspire others to join you on this journey.
So, getting the budget you need for diversity and inclusion may take some time and effort, but it’s well worth it. Remember, creating a more inclusive environment isn’t just the right thing to do — it’s also good for business. So, keep pushing forward, and together, we can make a real impact.
How to Spend Your Diversity and Inclusion Budget?
Now that you’ve got a budget set aside for your DEI efforts, the big question is: How do you make the most of it? Well, let’s dive in.
Define Your Goals
First things first, remember that DEI work isn’t just a one-time thing. It’s a journey. So, the first step is to figure out what your DEI goals are. What do you want to achieve? Do you want to increase the diversity of your workforce? Improve inclusion practices? Reduce unconscious bias in your hiring process? So, whatever it is, make sure your budget aligns with those goals.
Distributing Your Diversity and Inclusion Budget
Now, let’s talk about where to allocate those precious financial resources. One good idea is to invest in inclusion training programs. So, these programs can help your team members understand unconscious bias and develop skills to create a more inclusive workplace.
Consider Underrepresented Groups and Allyship
Another great way to spend your budget is on development programs for underrepresented groups. Therefore, by providing support and resources for diverse employees, you’re not only investing in their success but also building a stronger, more diverse workforce.
Don’t forget about inclusion initiatives like focus groups or allyship programs. These can help foster a more inclusive culture and give everyone a voice at the table.
And hey, if you’re in the tech industry, consider investing in programs that support diversity in artificial intelligence or partnering with historically black colleges to recruit diverse talent.
But What Happens if There are Diversity and Inclusion Budget Cuts?
Now, I know budget cuts can happen, but here’s the good news: investing in DEI initiatives isn’t just the right thing to do, it’s also good for your bottom line. Research has shown that companies with more diverse teams perform better financially in the long run.
So, when you’re going through the budget process, make sure to advocate for intentional DEI budgets. Show your executive team the business case for DEI investment and the real impact it can have on your company’s success.
In the end, creating a more inclusive environment goes far beyond simply spending money. It’s about making a commitment to positive change. And with the right path and significant investments, you can make a lasting impact on your entire organization. So, let’s roll up our sleeves, take a closer look at where we can make the most impact. Also, let’s start building a more inclusive workplace, one budget at a time.
Why I Wrote This:
Allocating funds to a DEI budget is a key part of the future success of any business. Ongig’s mission is to support diversity and inclusion as a top priority. If you’d like to learn more about how our job description software can help you create more inclusive and effective job descriptions, please request a demo.
This is a guest post from Ida Pettersson. Ida is a Content Writer at Resume Genius who enjoys supporting job seekers as they plan their next career moves. She graduated from New College of Florida with a double major in Philosophy/Chinese Language and Culture. In her spare time, Ida enjoys hiking, reading, and gardening.
