Chris Kempczinski McDonald's

Summary List Placement

Diversity, equity, and inclusion (DEI) aren’t just buzzwords corporate leaders can throw around anymore. Increasingly, C-suite leaders find some of their compensation tied to meeting goals in these areas. 

In 2017, a survey of some 10,000 business and HR leaders conducted by Deloitte found that 78% of respondents believe diversity and inclusion is a competitive business advantage. Yet, only 6% of companies surveyed actually tied compensation to diversity outcomes at the time.

That’s since changed. A 2019 Mercer study found that 51% of firms include ESG metrics (environmental, social, and governance standards, which includes DEI metrics) in their executive incentive plans or are considering doing so. 

McDonald’s, for example, announced last week it would tie 15% of senior executives’ bonuses to new goals for diversifying the company’s leadership.

The company aims to increase the percentage of women at the senior director level and above from 37% to 45% globally by the end of 2025. The fast food giant also wants to boost the percentage of people from underrepresented backgrounds in those positions from 29% to 35% over the same time period. 

McDonald’s joins a growing number of companies making commitments to measuring social progress.

In June, Wells Fargo’s CEO announced the company would tie executive compensation to diversity and inclusion goals. And in October, Starbucks announced it would do the same.

Industry leaders are paving the way for accountability 

Gregg Passin, senior partner at Mercer, said that over the last few years, there’s been an increase in companies measuring progress in diversity, equity, and inclusion. 

“More companies are discussing this internally and announcing that they are adopting some DEI metric,” Passin told Insider. 

The progress comes as more workers, customers, and investors demand change. 

Verizon was an early adopter of this type of program. In 2014, the company began including specifics about tying …read more

Source:: Business Insider


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