Why a diverse workplace makes economic sense

It is important for a better understanding of customers and for greater innovation

Earlier this week, the Prime Minister’s Office held a meeting to discuss affirmative action in the private sector. According to the Indian Express, questions were raised over the sector’s commitment to providing jobs to scheduled castes and scheduled tribes. The timing of the meeting was crucial since it came on the heels of protests for job reservation and in opposition to what some saw as the dilution of the SC/ST Act.

This newspaper has long held the view that there should not be a quota raj in the private sector because the fuel that runs this engine is eligibility and merit. Having said that, there is another aspect to the argument that the private sector should also consider: It is in their enlightened self-interest to ensure diversity in workplaces, especially in a country that is so inherently unequal. Diversity is also critical for a better understanding of customers, better team performance, greater innovation and creativity, and better brand image.

And why only the diversity of workplaces? It also makes immense sense for companies to invest in communities around their office/project sites. According to a World Economic Forum report, for businesses to work efficiently and profitably, they must understand the complexities and dynamics surrounding them. Mitigating fragility and building resilience are not just a humanitarian imperative — instability and violence are bad for business as well. In India, we have seen several situations where local communities have protested against businesses because they have been not benefited in any way from them. In fact, the corporate social responsibility movement began as a response to advocacy for corporations to play a role in solving social problems due to their economic power and overarching presence in daily life. The Sustainable Development Goals too puts a lot of onus on the sector to play a more proactive role in improving the lives of people and benefit from such engagements.