Why reward and benefits are pivotal to D&I strategy

Having a solid diversity and inclusion (D&I) strategy, alongside creating a sense of belonging for every employee, has been a key undertaking for organisations globally. McKinsey’s Diversity Still Matters report in 2020 found that D&I is the bedrock of a successful business, and a diverse and inclusive workforce is the key to stronger performance.

The responsibility of upholding these policies and values has traditionally landed on the shoulders of people and recruitment professionals, but reward and benefits also have a pivotal role to play.

D&I must be integral to everything your organisation does and the overall employee experience, which includes reward and benefits. Businesses must start to question whether every employee will be able to take full advantage of what’s on offer.

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For example, under the Shariah laws for those following the Islamic faith, earning interest from and investing in funds which derive from the sale of alcohol, tobacco and gambling is prohibited. Therefore, pension investment in most funds are out of bounds. In addition, some healthcare benefits are not open to those with pre-existing conditions which excludes people with disabilities or chronic conditions.

According to research by Aon, over half (52%) of organisations are planning to, or are already, reviewing their compensation and benefits programmes to strengthen diversity, equity and inclusion (DEI) initiatives. In its recent whitepaper Diversity, Equity and Inclusion in the Workplace, Aon advised that more organisations need to consider DEI when planning benefits and initiatives.

Meanwhile, research by Reframe found that while many organisations are aware of the importance of D&I, only 27% of HR professionals expect their D&I agenda to influence benefits design.

Despite this finding, research by Willis Tower Watson in 2019, found D&I is gaining traction, with three fifths (60%) of UK employers now planning to incorporate D&I into their benefits design.

Although employee benefits are just one cog in the D&I wheel, reward and benefits professionals are a crucial component in delivering a diverse, equal and inclusive workplace culture.

Don’t forget to take part in our short survey to better inform this critical part of reward strategy.