Despite having to compete fiercely for talent, private companies are behind public companies in pursuing diversity, equity and inclusion (DE&I) policies. According to the 2023 GBRS survey, over half (59%) of private companies believe they need bold change rather than incremental progress in DE&I vs 71% respondents of publicly owned companies. This indicates that private companies may benefit from adjusting their perspective on DE&I and recognizing it as a critical component of their business strategy going forward.
Lack of investment in DE&I can damage a company’s employer brand, weakening its ability to attract and retain the talent that is critical to future growth. What’s more, companies will be missing out on the innovation opportunities that may be generated by varying perspectives derived from a diverse workforce.
Private companies should also consider how new ways of working — across borders and jurisdictions — can have heightened expectations in relation to workforce flexibility, talent strategy and technological investment. This is against a background of increasingly complex economic, geopolitical and social challenges. To build sustainable value in this climate, business leaders need solutions that address risks and boost reward when it comes to talent strategy.
Organizations need to pinpoint their employees’ locations if they are to effectively initiate responses to potential physical safety or cybersecurity issues, and to gauge the degree to which the organization is exposed to tax, immigration or regulatory risk. According to the 2023 Mobility Reimagined survey, while the majority of mobility professionals indicate their organization has some sort of approach toward hybrid mobility, surprisingly just 37% of employers believe their organization’s hybrid mobility policy adequately addresses the tax and regulatory risks linked to mobility. Due to this discrepancy, there is a pressing need to strengthen hybrid mobility policies so that these risks can be effectively managed according to the survey.
A survey of more than 350 corporate board members for the Americas board priorities 2024 report found that talent is one of the top five priorities for board members across the Americas. To achieve better talent outcomes, private companies need to foster a workplace where employees feel trusted, empowered, connected, well-informed and genuinely cared for by their leaders. They also need to show that they value a diverse workforce and are committed to building an inclusive working environment that enables everyone to succeed.
“Where a board can help is really understanding where the focus areas are,” says a board member for a privately held Americas franchise, “You have to figure out the business problem you’re trying to solve. Is it attraction of diverse talent? Is it retention of diverse talent? Is it development of diverse talent?”
All three are essential tenets of any talent strategy. Nevertheless, different approaches are necessary if private companies are to address them with the same level of effectiveness.
Culture is king
When it comes to implementing effective risk management strategies, it is hard to overstate the importance of culture. A strong risk culture, as defined by the Institute of Risk Management, is a culture where everyone shares the same values, beliefs, knowledge, attitudes and understanding about risk.
All members of the workforce should have an awareness of the broad spectrum of risks that exists in today’s business environment, from traditional through to atypical. The boards of private companies can play a crucial role here by ensuring that a culture of risk awareness is instilled throughout the organization by emphasizing the significance of nontraditional risks with executives.