On the Frontlines: Why Focus on DEI?

For those who missed our presentation, here are some pointers about how a diverse culture can impact organizations and the role auditors play in DEI initiatives.

When it comes to public scrutiny over DEI efforts, there is a lot of focus around DEI through different social justice campaigns, so there has been an increase in risk from a public perception perspective. The increased focus on DEI can either be good or bad for an organization. For a company that is intentional about DEI, that increased focus is a positive thing and will work to its advantage. However, for organizations that do not focus on DEI, there could be increased reputational risks that could have a potential negative impact on that organization.

DEI is a journey that every organization should be thinking about. I believe inclusion is the best starting point. I think we should ensure our organization’s leaders are intentional in how they message DEI initiatives and understand the importance of listening to staff and responding through actionable items that are measurable. Being intentional can be as simple as ensuring that the interview process of a new hire involves people from different backgrounds.

One of the ways internal audit teams can advance these conversations is through performing cultural audits to promote and understand the organization’s culture as it relates to diversity, equity, and inclusion. While DEI audits around culture may not yet be showing up on most audit plans, I expect it to become more mainstream soon, and more organizations can expect to be assessed on it. Internal audit is well positioned to help organizations in this area, and the profession should continue to think about going beyond numbers to measure the genuine human aspects of an organization.

One trend to be aware of is that when recruiting new talent, questions about DEI programs are increasingly coming up in interviews. Going forward, more and more people are going to focus on DEI, whether from the perspective of a company, client, customer, or new employee. People want to see positive change in society, and companies can signal they’re receptive to change by being intentional about DEI. A strong DEI culture also can improve employee retention and help close the talent gap.

From a regulatory perspective, over the next few years, it’s possible we may start to see increased mandates around DEI, similar to how the environmental factors in environmental, social, and governance have begun to be regulated.

Having had the opportunity to speak about this topic at GAM was exciting. I am happy to see The IIA is focused on DEI, and I hope that our session helps continue the conversation within the profession. Leaders need to start thinking about unique ways to nudge the culture and push it forward. We all need to think of new ways of looking at the process and ensure we’re having the right conversations.