Sustainability and Equity: The Foundation for Future Growth 

The triple bottom line—people, planet, and profit—has always been a guiding principle for responsible business, but today, it is a necessity. Companies that prioritize sustainability and equity are not only securing their future but also improving their brand reputation, employee engagement, and customer loyalty. 

The demand for sustainable products and ethical corporate practices continues to grow. According to PwC’s 2024 Voice of the Consumer Survey, 80% of consumers are willing to spend more on sustainably produced or sourced goods, with some willing to pay nearly 10% more. This shift underscores the importance of embedding sustainability into product development, supply chain decisions, and brand messaging. 

Yet, many businesses are still falling short. A 2024 Pew Research Center survey found that 69% of Americans believe large corporations are not doing enough to combat climate change. This perception presents both a challenge and an opportunity: companies that act decisively in addressing sustainability concerns can differentiate themselves and build stronger connections with conscious consumers. 

The Role of DEI in Sustainable Business Strategy

Any sustainability strategy must also ensure that the transition to a greener economy is fair and inclusive. Climate change disproportionately affects marginalized communities, making it critical for businesses to approach sustainability through a lens of diversity, equity, and inclusion (DEI). 

For example, diverse teams drive more innovative sustainability solutions. Having a diverse board of directors, a diverse leadership team, and a diverse workforce help ensure that a variety of perspectives are considered when decisions are made. But diversity is more than adding women or culturally diverse individuals to the boardroom or C-suite. Diversity should include different generations, income brackets, professional skill sets, acquired experiences, and more. Multiple studies have shown that diverse teams working in psychologically safe workplaces are more innovative and form better policies and strategies.  

Additionally, organizations might consider increasing the number of local suppliers they use. Suppliers and vendors with diverse ownership could offer cost- and resource-saving solutions. The shorter supply chain could also reduce a company’s carbon footprint while making a positive impact on the local economy. 

Organizations that integrate DEI into their sustainability planning are better equipped to anticipate risks, respond to stakeholder needs, and create business models that are both profitable and socially responsible. 

Why Sustainability Boosts Engagement and the Bottom Line

Consumer awareness of climate change and corporate responsibility has risen dramatically. A 2024 Bain & Co. report found that 60% of consumers are more concerned about climate change than they were two years ago. As a result, they are actively choosing brands that align with their values and rejecting companies that engage in greenwashing—making authenticity and transparency more important than ever. 

We can expect that climate-friendly practices will become even more important as younger generations are even more supportive of and responsive to corporate responsibility. Companies must go beyond surface-level sustainability pledges. Genuine action, backed by measurable impact, is the key to building consumer trust.  

Sustainability also has a meaningful impact on employee recruitment—and engagement after they are hired. Deloitte found that roughly one in four job seekers (27%) consider a potential employer’s position on sustainability before accepting a job. Companies that prioritize sustainable practices also see increased employee engagement, with the majority of workers at mission-driven organizations saying they’re inspired, motivated, and loyal. 

Additionally, sustainability supports improved product and service development. In other words, embracing climate-friendliness opens a company to new markets, inspires new products and services, and drives innovation. Not to mention that green strategies, like improving product life cycles, are proven to boost customer satisfaction. 

Organizations that integrate sustainability into their business operations—from sourcing materials to waste reduction and ethical labor practices—will earn loyalty from both customers and employees. 

The Future of Business: Profitable, Sustainable, and Inclusive

The intersection of sustainability and DEI represents a powerful opportunity for business leaders in 2025 and beyond. Consumers and employees are no longer satisfied with performative statements—they demand real action and accountability. 

By prioritizing sustainability and equity, companies can build a resilient business model that not only drives profitability but also contributes to a more just and sustainable world. The future belongs to businesses that recognize the value of people and the planet—not just the bottom line.  

Diversity, equity and inclusion are essential components of The Employee Engagement Growth Model – a framework that enables organizations and leaders to boost the effectiveness of teams while inspiring enthusiastic, motivated, and committed employees to do their best work. Contact us today to learn more. 

Amber Keister is a Content Strategist at The Diversity Movement. She has spent more than 20 years as a journalist for publications throughout the South. Connect with her on Linkedin.

The post Beyond Profit: Why Sustainability and Equity Drive Business Success appeared first on The Diversity Movement.

Fortunately, more than 90% of S&P 500 companies now publish environmental, social, and governance (ESG) reports, and the U.S. Securities and Exchange Commission (SEC) may soon require additional ESG reporting. Governance data, in particular, reveals how organizations are being run today and whether they are prepared to meet future challenges. 

What is included in governance metrics?

Who is in the C-suite? Does the Board of Directors consist of diverse individuals? Is the company’s accounting accurate, and are its business practices ethical? What guiding principles, policies, and practices have executive leadership put in place? Governance metrics like these help stakeholders and investors assess the strength of the company, its leadership team, and their ability to manage risk.

While specific metrics may vary, companies commonly assess the following aspects of good governance practices: 

• Leadership and oversight. Board of directors and leadership teams are diverse, executive compensation is aligned with industry norms, and a strong succession plan is in place.
• Fair labor practices. Company maintains pay equity, follows global human rights protocols, and complies with anti-discrimination laws.
• Risk management. Accounting procedures and financial reporting are transparent, data security and privacy are guarded, and workplace safety policies are followed.
• Business ethics. ​​Employees abide by a code of conduct, corruption prevention safeguards are in place, and the company ensures its suppliers also follow ethical norms.

Why should companies track governance information?

The Securities and Exchange Commission and other global regulatory agencies are increasing pressure for companies to disclose ESG information such as board diversity, hiring practices, and pay equity. According to PwC, the SEC is expected to soon update its workforce – or human capital – disclosure requirements to include more of these nonfinancial metrics. There are also bottom-line advantages when organizations pay attention to governance criteria and real-world consequences when bad business practices are allowed to flourish.

In 2015, it was revealed that Volkswagen Group engineered 11 million diesel cars to fool emissions tests. While Volkswagen’s reputation and its stock price have recovered since the scandal, the company paid more than $30 billion in fines, penalties, restitution, and lawsuit settlements. 

In a more recent example, Fox News is defending itself in a $1.6 billion defamation lawsuit brought by Dominion Voting Systems, accusing the network of falsely claiming the 2020 election results were inaccurate due to faulty voting machines. As part of the lawsuit, emails emerged from Fox executives urging on-air staff to stop correcting guests who were spreading the lies, because it was “bad for business.” However, the executives failed to anticipate the financial and reputational risks of their unethical behavior. 

What is the link between DEI and good governance?

It’s clear how unethical behavior and poor oversight can impact an organization’s profitability, and there is growing understanding of the link between a robust diversity, equity, and inclusion (DEI) strategy and good corporate governance. Several common DEI practices demonstrate how organizations that invest in DEI can, at the same time, invest in good business practices. And, by collecting and tracking improvements in these areas, ESG managers gain important data that can be reported to stakeholders. 

Increasing board diversity is one of the best ways that companies can demonstrate their commitment to ESG. Having a diverse board of directors is associated with better business outcomes as a result of stronger decision-making, faster problem-solving, and increased innovation. But improving board diversity is more than adding women or people of color to the boardroom. Diversity should include different generations, income brackets, professional skill sets, acquired experiences, and more. 

A diverse board of directors is better able to provide oversight and hold executives accountable for their business decisions. When directors can provide a different perspective or alternative solution to a pressing business problem, there is less likelihood of risky executive behavior.

Because of overwhelming evidence of the power of diverse leadership, states including California and New York have begun to require public companies headquartered in their states to have a minimum number of women directors and/or at least one director from an underrepresented community. According to the American Bar Association, in 2021 there were at least ten pending shareholder derivative lawsuits alleging that a lack of board and management diversity constitutes a breach of fiduciary duty. 

Pay equity is another common DEI goal, a key component of ESG reporting, and a vital piece of high-performing companies’ labor practices. When organizations equally compensate all employees who do the same work or have similar duties – regardless of race, gender, LGBTQ+ identity, or other dimension of diversity – they are more attractive to potential employees. In fact, transparency in compensation and promotion are important tools in attracting and retaining talented employees. By establishing a policy of wage equity, companies can also demonstrate to consumers, employees, and other stakeholders that leadership is committed to ethical business practices, contributing to a stronger brand reputation. 

Tracking governance metrics

While there isn’t currently a consistent standard for collecting, tracking, and reporting metrics for ESG reporting, there is an increasing call for corporate transparency – from regulators as well as shareholders. ESG isn’t going away. Companies that can prove their commitment to ESG objectives with quantifiable data over time, put themselves at an advantage. 

Effective DEI strategies begin with an objective, holistic assessment of a company’s strengths and weaknesses. These surveys enable companies to measure leadership diversity, pay equity and compensation transparency, and effectiveness of anti-discrimination policies and procedures. And, because they are already tracking key governance indicators, companies with strong commitments to DEI can improve and streamline their ESG reporting.

Analytics by The Diversity Movement is an AI-driven platform that enables you to track data across your enterprise and get a holistic view of your company’s DEI progress. In addition to collecting information on employee and leadership demographics, TDM Analytics also surveys attitudes and opinions about diversity, equity, belonging, and inclusion. You’ll be able to see at a glance where your efforts have been successful and where you need to improve.

The post Metrics that Matter: Using ESG and DEI to Improve Leadership Teams and Governance Data appeared first on The Diversity Movement.

Tune in to this episode to learn more about the best practices for building diverse and inclusive boards and how they can positively impact organizations in the long run.

The post How Diverse Boards Sustain Organizational Success, with Laura Sanderson appeared first on The Diversity Movement.

Retirement fund managers regularly consider environmental, social, and governance (ESG) factors in their investment choices, and the socially conscious strategy is getting a lot of attention. In fact, Joe Biden used the first veto of his presidency to support the practice. He rejected a bill that would have prevented retirement fund managers from considering ESG. 

But what exactly is ESG, and why is it important to investors? 

Demand for information about corporate behavior continues to grow, as more socially conscious consumers and investors seek to align their financial decisions with their personal values. ESG metrics enable companies to measure, track, and report their ethical impact and environmental sustainability. Critics of ESG – including many lawmakers from oil- and gas-producing states – dislike ESG because of its emphasis on promoting social goals like lowering carbon emissions rather than maximizing returns. 

However, reporting ESG does more than signal that a company is a good corporate citizen. Investors flock to companies with high ESG scores, because they are more profitable, more sustainable, and better able to manage risk. 

Why are DEI and ESG metrics so important now?

Companies with high ESG scores are also more likely to be diverse, culture-centric organizations, because diversity, equity, and inclusion (DEI) practices strengthen and, as we will explain, enhance all three elements of ESG. As consumers, shareholders, and investors become increasingly values-oriented, corporate leaders can’t afford to ignore the double benefits of DEI and ESG. 

However, greater interest in ethical investing isn’t the only reason DEI and ESG are becoming more important for corporate executives and boards of directors. The Securities and Exchange Commission and other global regulatory agencies are increasing pressure for companies to disclose DEI information such as board diversity, hiring practices, and pay equity. Sometime in 2023, according to PwC, the SEC is expected to update its workforce – or human capital – disclosure requirements to include more of these nonfinancial metrics.

Organizations that measure their DEI performance – and include that information in their ESG reporting – are able to objectively demonstrate their commitment to ethical business practices. By linking DEI and ESG, culture-centric companies can improve their brand reputation, connect with customers, and attract more investors. 

What are some ESG metrics?

Organizations have a great deal of leeway in measuring ESG metrics based on individual preferences and commitments. Each major category of ESG criteria — environmental, social, and governance — covers a wide range of issues that have historically been excluded from investment and purchasing decisions. Some common metrics include:

Environment

These metrics focus on a company’s environmental impact and include greenhouse gas emissions, pollution, water use, and natural resource depletion. 

Social

These metrics reflect the way a company engages with its employees and how it impacts the wellbeing of the community. This pillar considers metrics around diversity, employee satisfaction, safety incidents, volunteerism, and taxes.

Governance

These metrics test a company’s commitment to purpose and accountability. Included in this analysis is a standard to measure ethical behavior and risk. Governance factors include board diversity, succession planning, and executive compensation.

How does DEI influence ESG?

DEI should be the foundation for an organization’s ESG strategy, because programs that are established with diversity, equity, and inclusion in mind also increase a company’s sustainability and success.

For example, supplier diversity is a common DEI priority, and companies that diversify their supply chain will see immediate benefits that also align with ESG objectives. Using more locally-based suppliers results in a smaller carbon footprint. Money and talent will remain in the local economy, boosting community wellbeing. Diversifying to include businesses owned by women, veterans, and people of color can also provide capital injection into underserved areas of the supplier market.

The impact of Employee Resource Groups (ERGs), another common DEI program, can also be measured, tracked, and included in social metrics. One study found that 50% of ERG members reported increased job satisfaction and an intent to remain at their job long-term, helping employers lower recruiting costs. 

Board diversity, a DEI priority and a frequently reported governance metric, is another powerful indicator of success. Boards with multi-dimensional diversity have been shown to be better equipped to guide their companies through tough times, leading to increased profitability, greater innovation, and lower risk. According to a report from Board Ready, companies with diverse boards were better prepared to survive and thrive during the Covid-19 pandemic.

ESG and DEI drive profits and investment

Companies with a strong ESG focus also tend to be financially successful overall. For instance, software company Salesforce is an industry leader in ESG. The company has already achieved net-zero operational carbon emissions and has even bolder sustainability goals for the future. In addition, they’ve allocated $16 million toward equal pay initiatives and established a racial equality and justice task force.

With a leading market share and a history of producing double-digit shareholder returns, Salesforce is one of the most financially successful and stable companies in the industry. Its revenues continue to grow by the billions year-over-year.

A global study by the CFA Institute found that 85% of investment professionals now take ESG factors into account when investing. According to Gartner, 91% of banks monitor ESG, along with 24 global credit rating agencies, 71% of fixed income investors, and over 90% of insurers. 

It’s clear that focusing on ESG and DEI, in addition to traditional measures of financial analysis, is a powerful strategy for long-term success. As competition heats up to attract socially responsible investors, consumers, and employees, these two intertwined strategies will only grow in importance. 

Unlike quantifiable metrics like water and energy usage, workforce data can be challenging for companies to collect, measure, and track progress over time. Analytics by The Diversity Movement makes it easy for organizations to measure DEI data across the enterprise and get a holistic view of progress. In addition to collecting information on employee and leadership demographics, TDM Analytics also surveys attitudes and opinions about diversity, equity, belonging, and inclusion. You’ll be able to see at a glance where your efforts have been successful and where you need to improve. 

To learn more about DEI, ESG, and how successful organizations use both in their strategic business decisions, look for these articles in our Metrics that Matter series. These and many other resources are in TDM Library: 

• Strategic DEI Boosts the Social Impacts in ESG Reporting
• Use ESG and DEI to Create Better Corporate Leadership Teams
• Long-term Environmental Sustainability Depends on DEI and ESG

Amber Keister is a Content Writer and Editor at The Diversity Movement. She has spent more than 20 years as a journalist for publications throughout the South. Connect with her on Linkedin.

The post Metrics that Matter: ESG and DEI Work Together to Create Sustainable Business Success appeared first on The Diversity Movement.

The post Why organizational sustainability depends on its social intelligence, with Kelly Cooper appeared first on The Diversity Movement.

Studies show that board diversity has improved in recent years but still has a long way to go. In 2021, women make up more than 50% of the U.S. population and 56% of U.S. college graduates but hold only 27% of board seats in the S&P 500. Women of color make up 18% of the population but hold just 4.6% of board seats in the Fortune 500. It’s time for change.

In this webinar, we:

• Review the business benefits of diversifying your board, plus dispel common misconceptions
• Share action-oriented strategies for developing a diverse board member pipeline
• Discuss ways to improve DEI education at the board level so members can model inclusive behavior and advocate for organization-wide DEI implementation

This webinar is moderated by TDM CEO and serial board member, Donald Thompson, who is joined by guests Hilda Pinnix-Ragland, Paul Dillon, and Suzanne Miglucci.

Watch Now On Demand

Take a deeper dive with our whitepaper, Board Diversity: a Catalyst for Organizational Success.

The post Increasing Diversity, From the Top Down Webinar: Why Board Diversity Matters to Your Organization appeared first on The Diversity Movement.

To date, most of the veterans currently serving on corporate boards tend to be those known as “flag rank” officers. That is, those officers who have reached the general officer or admiral ranks.

But, it is important to note that officers of lower rank — and, even senior non-commissioned officers, who have substantial business experience — can be valuable as well, and serve to diversify corporate boards with experience in strategy, team building, leadership, and an unwavering commitment to mission focus that is unmatched in the civilian world. And, if that veteran also happens to be service-disabled, they can fulfill another important, but often overlooked, diversity criterion.

While there is no widely-recognized, common definition of the skills and qualities that comprise an effective board member, I have selected several traits from published literature that are often used to evaluate potential candidates for board membership. Of course, strong business and governance experience is a must. Beyond that, the characteristics of an effective corporate director strongly parallel those honed by people who have excelled in the armed forces. In fact, I would argue the traits gained by serving in the military are unmatched in the civilian world, and are also areas where many traditional directors fall short.

Dedicated and Committed to the Organization 

The military is extremely mission focused. The whole idea in the Armed Forces is to seize the objective — while, at the same time, ensuring the integrity and welfare of your troops. There is no alternative to accomplishing the mission, yet there is a sense of broader accountability. With the growing concept of companies increasingly looking at stakeholders beyond shareholders, that sense of a broader purpose has been at the heart of U.S. military service for centuries.

The Ability to Formulate Strategy and Ensure Its Execution

You need to form a strategy — a vision — of what your battle plan is going to accomplish. But just as important, you need to ensure that the resources are in place to execute that battle plan flawlessly. Failure is not an option. While corporate board directors might have strategy experience, many might not have held actual responsibility for successfully executing that strategy — and, even if they have, certainly not under the crucible of armed combat.

Understand the Complexity of a Situation, but Explain Simply

The military requires that its leaders immediately grasp the complexity of a battle plan, yet at the same time, give clear and understandable guidance on how that battle plan will be carried out by the troops under their command. Often, corporations seek board members with defined experience in specific areas like finance, marketing, or technology. But do those recruit board members understand the entire battlefield? Can they identify areas where there are key vulnerabilities, the ability to seize opportunities, and who are the weaker and stronger soldiers?

Understanding That Diversity Leads to Victory

The whole Armed Forces are built on the “buddy system.” Nobody accomplishes the mission alone. If you’re going to be successful in the military, you need to work with all types and kinds of people, from all races, creeds, genders, backgrounds and persuasions and weld all of these disparate interests into a fighting force that’s going to defeat the enemy. Successful military leaders relied on diversity well before the term “diversity and inclusion” was ever mentioned in the boardroom.

Knowledgeable and An Insatiable Learner

Service in the Armed Forces of the United States forces you to become a life-long learner. You need to learn quickly from your mistakes, so that you don’t repeat them again. “After Action Reports,” where lessons learned from the actions taken on the battlefield are explored in great detail, are standard operating procedure in all of the military services.

Embrace Change and Transformation 

When most people think about military service, they think that it’s all just about the rigidity of following orders. Well, that’s true — in part. Of course, you need to follow orders. But, what most people never see is that the military teaches you to think and act flexibly, so that if your battle plan isn’t working, you pivot immediately to a plan that does. Flexibility and immediate action are key to survival.

Duty Before Self and Taking Care of Your People

Finally, the best leadership training in the world is the training that is given to commissioned officers and senior non-commissioned officers in the U.S. Armed Forces. As young Army officers, we were taught to take care of our troops first, if you want them to follow you. An officer has to convince the people under their command that they have their best interests in mind while they are accomplishing the mission. An officer doesn’t eat until all of their troops have eaten. An officer is the last to sleep and walks the perimeter of the camp to ensure that their troops are safe and sound. Otherwise, the troops just aren’t going to follow you to places where they wouldn’t go by themselves. As a shareholder, I want a CEO who lives by that same creed.

There are many other traits and characteristics of those who have served as officers in the military that enable these people to excel at corporate board service, such as a high degree of integrity, discretion, and confidentiality.

As a shareholder, it’s important to have directors who are domain experts and peer CEOs — but, in the increasingly complex environment for business, is that enough? Military leaders at all levels are trained as nimble strategists, values-based leaders, and have always valued diversity as a key to building effective organizations. They have led this country to greatness and can do the same for American business.

They just need a seat in the boardroom.

To learn more about the business benefits of diversifying your board, plus actionable strategies to get started, register to attend our free webinar on October 28, Increasing Diversity, From the Top Down: Why Board Diversity Matters to Your Organization. This 1-hour webinar will be hosted by TDM CEO Donald Thompson and feature guests Paul Dillion, Suzanne Miglucci, and Hilda Pinnix-Ragland.

Paul A. Dillon is an adjunct instructor in the Sanford School of Public Policy at Duke University. He is a former U.S. Army Reserve officer and Vietnam Veteran, awarded two Bronze Star Medals.

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