Diversity is great for business

Science has proven that increased diversity leads to happier and more efficient staff.
Diversity fosters innovation, increases retention, and improves performance.

Better financial performance

A 2015 report by McKinsey analysed data from over 350 companies and found that companies were 15% more likely to have financial returns over their national industry median if they were in the top quartile for gender diversity, and 35% more likely if they were in the top quartile for ethnic diversity. "A study of more than 500 organisations has found that every 1% increase in gender and racial diversity is correlated with a 3% to 9% increase in sales revenue, respectively." – Ideal.com. Whilst not proving causal relationships, this still shows that more diverse companies tend to perform better financially.

Improved Innovation

A large-scale 2018 survey from Harvard Business Review found that across eight countries, six different diversity factors (age, gender, industry background, national origin, career path and education) each positively correlated with innovation outcomes. They calculated that innovation revenues for the average respondent company could increase by 1% by enriching the diversity of its management team, and found that effects were particularly large for factors like gender, national origin and industry background. As a whole, research backs the idea that increasing workplace diversity can foster creativity and facilitate new ideas.

Happier Employees

A more diverse workplace benefits everyone in the business. A 2006 study of US employees found that job and life satisfaction were highest for respondents who had a medium proportion of co-ethnic workers (i.e. co-workers of the same ethnicity). Nurturing diversity makes employees feel more comfortable and welcome in their environment, boosts their confidence and breaks down social barriers.

Sigma Polaris and Diversity

The recruitment process has three stages. 1) Candidate Attraction, 2) Candidate Assessment/Screening, & 3) Interviewing.

ALEX, the assessment and shortlisting software of Sigma Polaris, helps companies with the second step. Our AI ALEX simply cannot factor in variables such as gender/ethnicity/age/name of university/CVs/etc. and the shortlists help HR-managers/recruiters select the most suitable candidates for interviews based on meritocracy and insightful candidate-profiles without falling into the traps of bias.

There are many tools available to help companies with their diversity in the Candidate Attraction step e.g. targeted advertisements, webpage/social-media/job-spec analysis for gender/cultural biases, etc.

Likewise, almost every HR-manager is trained in how to eliminate explicit and implicit bias.

However, even if a company has achieved perfection in each of these steps, it does not matter if they have a faulty assessment/screening process.

If the screening of 500 candidates results in the interviewing HR-manager having to do a hire from 10 white-heterosexual-males from OxBridge, selected from faulty screening, then there is very little they can do to foster diversity.

Note that this is not to say that recruiters and HR-managers are normally at fault. A wealth of scientific research shows that everyone holds unconscious stereotypes relating to age, gender, ethnicity, and so on (see Staats et al., 2015 for an overview). These biases have been proven to affect our decision-making, including who is called for interview, particularly if based on CV assessments.

ALEX helps companies rid the screening step of its inherent implicit and explicit bias, enabling recruiters and HR-managers to showcase their true capabilities.

At this point, if a company’s diversity goals are still not met, strategic attraction of candidates can be done. This, together with ALEX assisting in the screening and well-trained HR-managers performing the interviews, will naturally help the company achieve its diversity goals and a culture to be proud of. This is True Diversity.

There is an alternative approach. One can actively skew the assessment process in the screening and/or interviewing stage. As such, screen and hire candidates who seem weaker and less suitable than other candidates, but who fall into some underrepresented group in the company. We call this False Diversity and despite being present in many companies it is an illegal form of discrimination. (Unless the minority in question is a disability category.)

False Diversity may reach the company’s numerical goal, however, if it is known or even suspected that some employees were selected under such circumstances, will that really foster a work culture to be proud of? Will it not influence how this group of people is treated, how they perceive themselves, their credibility within the workforce, and directly/indirectly increase the bias within the company? One could attempt secrecy, have the recruiters/HR-managers do the skewed screening and then hope it doesn’t leak. However, is it worth the risk? Isn’t transparency to be preferred in a healthy work culture?

As such, might it not be better to do target candidate attraction, posting advertisements strategically to reach the highly qualified candidates fitting the target group currently in minority in the company and then do an objective fair screening and interviewing of all applicants based on meritocracy?

At Sigma Polaris we believe this to be the case. Transparency, meritocracy, and fairness. These are things to be proud of.

We are passionate about helping companies find the best candidates based on meritocracy, and through that help them develop a culture of True Diversity to be proud of.


Sigma Polaris – Delivering True Diversity and Meritocracy to HR


*There is a place for positive discrimination, e.g. study grants, however, the place is not in the assessment stage.