Workplace diversity and why it matters

Diversity in the workplace is at the forefront of creating healthier, more inclusive environments. The office or space in which we work should be leading on equality and providing a work environment where all people are welcome and feel comfortable, regardless of ethnicity, race, sexual orientation, age, sex, or gender. Diversity also includes diversity of thought, education, skill sets, experiences, beliefs, and personalities. 

Unfortunately, it is usually cases of discrimination which bring these issues into sharp focus and motivate organisations to improve their Diversity, Equity and Inclusion (DEI) Initiatives. The Black Lives Matter movement has catalysed many organisations to implement unconscious bias training. Structural, institutional change is required, without which diversity training may simply be a box-ticking exercise. Unconscious biases are just one aspect of how discrimination and prejudice can play out; strong policies, strategies and practices should be enforced company-wide to support any diversity training.

Alice Thompson, a working mother, recently won a landmark sex discrimination court case because her employer wouldn’t allow her to work part-time and leave work early to pick up her child from nursery. Working parents expect employers to be flexible and reasonable in consideration of family commitments. Historically, it has been women who must balance these commitments with their work, but no parent should feel discriminated against if they have family commitments or request parental leave. In male-dominated sectors which still lack gender diversity, women can feel particularly isolated when making these decisions, so it is imperative that HR teams are also diverse.

Why is workplace diversity important?

Job seekers are increasingly looking for roles within diverse companies that promote an inclusive culture. Whether or not a company truly has a diverse workforce can be key in the decision-making of potential candidates going through the recruitment process. This is particularly true for Millennials who expect employers to be progressive and proactive in this area. 

Prospective employees look to see a reflection of themselves in diverse teams. Organisations can draw skilled candidates to their talent pool and improve employee engagement by offering a genuinely diverse workplace. Talented candidates may have many job offers but money may not be the deciding factor for them. Seeing a team of people from different backgrounds with different perspectives can help them feel confident that an employer really does champion equal opportunity.

The benefits of diversity in the workplace also extend to profitability as demonstrated in a 2019 McKinsey analysis. Companies in the top quartile for gender diversity on executive teams were 25% more likely to have above-average profitability than companies in the fourth quartile. A more recent report from McKinsey, Diversity Wins, stated that companies in the top quartile for ethnic and racial diversity in management were 36% more likely to have financial returns above the industry mean. These statistics present a strong business case for diversity, showing that it is in the interests of both the employer and the employee.   

A sense of belonging was at the top of Deloitte’s 2020 Global Human Capital Trends survey as one of the most important human capital issues alongside well-being. 93% of survey respondents agreed that belonging drives organisational performance. This is one of the highest rates of consensus seen in a decade of Global Human Capital Trends reports, pointing to a societal shift that demands the attention of corporations. 

As we continue to live through a time of challenge and change, individuals must be seen for their skills and talents regardless of race, neurodiversity, physical abilities, sexuality, gender, or age. The ethnic diversity of young British people is also in stark contrast with the demographics of the past. Inclusivity for them is less of a concept and more of a natural way of doing and being.   

Encouraging diversity in the workplace

Just as unconscious bias training needs the support of strong policies, DEI initiatives must be well-considered, dynamic and responsive. Many organisations may communicate their DEI initiative through social media, but this can be perceived as performative and potential new employees will scrutinise the company culture and diversity goals for authenticity. For this reason, how workplace culture is communicated both externally and internally is of key importance.

Diversity is a continuous process so updates should be exactly that, updates on an ongoing path to diversity goals. The hiring process should introduce candidates to the company’s efforts in DEI and be transparent about whether it is an inclusive workplace in practice. A workplace can appear to be diverse, but inclusivity usually shows in how relaxed current employees feel in being their authentic selves.

Diversity also needs to be led from the top so hiring managers and leaders who are fully on-board with the DEI initiative and who are confident communicators is crucial to keeping momentum. How leaders behave and communicate trickles down through the organisation. This doesn’t mean that everyone has to agree on everything, it means cultivating an environment where people feel safe having open discussions and debates where their viewpoints are accepted even if they aren’t agreed with. Conversely, those who desire confidentiality or minority groups who do not feel safe speaking in an open-plan office, should be offered respect and discretion.

Diverse companies attract diverse talent

A strong diversity and inclusion initiative is becoming a given for leading corporations and organisations worldwide, especially if they want to attract talented and skilled individuals from all backgrounds. DEI is not something that can simply be mentioned in job descriptions to capture the attention of applicants, it is evident in how relaxed employees are in the workplace and how the workplace accommodates the needs of its employees.

Can you be an ambassador for diversity and inclusion in your organisation? Are you keen to learn more about what this means in an international business setting? Find out how you can with the University of York’s MSc International Business Leadership and Management online degree.

A guide to corporate social responsibility

Responsible business practices and a commitment to global social citizenship are needed to safeguard our shared future – and pave the way for a better world.

Some of the biggest issues facing our planet – including climate change, poverty, social inequality, food insecurity and human rights abuses – are ones that cannot be tackled without critical change within the world of business.

Businesses must play an integral part in shaping what happens next. From their environmental impact, to their work within local communities, to who’s involved in their decision making, any business model should be examined to identify where and how sustainability efforts could be supported.

What is corporate social responsibility?

Corporate social responsibility (CSR) is the idea that a business has a responsibility to the wider world. It’s a management concept whereby companies integrate social and environmental concerns in both their business operations and their interactions with stakeholders, offering a way for companies to achieve a balance of environmental, philanthropic, ethical and economic practices.

The triple bottom line (TBL) is the idea that businesses should prepare three distinct bottom-line measurements, also known as the three Ps: people, planet and profit. The TBL highlights the relationship between business and a ‘green mindset’; it attempts to align organisations with the goal of sustainable development, and positive impact, on a global scale. Ultimately, it offers a more rounded, comprehensive set of working objectives than simply profit-above-all.

CSR issues are wide ranging. They include environmental management, human rights, eco-efficiency, responsible sourcing and production, diversity and inclusion, labour standards and working conditions, social equity, stakeholder engagement, employee and community relations, governance, and anti-corruption policies.

Why is CSR important to businesses?

According to Impact, a leading social value measurement platform, CSR is good for business. They note that:

  • 77% of consumers are more likely to use companies that are committed to making the world a better place
  •  49% of consumers assume that companies who don’t speak on social issues don’t care
  • 25% of consumers and 22% of investors cite a “zero tolerance” policy toward companies that embrace questionable ethical practices
  • Consumers are four times as likely to purchase from a brand with a strong purpose
  • 66% of global consumers are willing to pay more for sustainable goods

On top of this, it’s estimated that CSR initiatives can help companies to avoid losses of roughly 7%. More and more businesses are publishing annual sustainability reports, in a bid for transparency in their efforts and operations and to benefit from its other advantages.

CSR is integral to the development of a more sustainable future. The better question for stakeholders wondering whether they can afford to spend time and energy implementing CSR strategies, is whether they can afford not to.

How can a business demonstrate CSR?

The United Nations Global Compact calls upon organisations to “align their strategies and operations with universal principles on human rights, labour, environment and anti-corruption, and take actions that advance societal goals”.

In addition to supporting businesses to aim for the prescribed United Nations Sustainable Development Goals, it asks them to adhere to ten Principles. The Principles outline measures across each of the key areas listed above. Examples of the measures include: the effective abolition of forced, compulsory and child labour; initiatives to promote greater environmental responsibility; the elimination of discrimination in respect of employment and occupation; and working against corruption in all forms, including extortion and bribery. It offers a framework and starting point for the minimum businesses must do in order to operate responsibly.

Similarly, in 2010, the International Organization for Standardization (ISO) launched new guidance: the ISO 26000. Designed for businesses who are committed to operating in a socially responsible way, it helps organisations to translate social principles into effective actions and shares best practice. Increasingly, a company’s adherence to ISO 26000 is regarded as a commitment to both sustainability and its overall performance.

Where CSR should be implemented in a business strategy depends on where improvement is required. If a business is energy-intensive, could that energy come from renewable sources? Where there’s a lack of diversity and inclusivity among employees, could human resource policies be revised? Could a multinational team of frequent flyers reduce their travel or offset their emissions?

The need for authenticity

Underscoring any CSR efforts is the need for authenticity.

In today’s world, the most respected brands don’t rely on virtue signalling – they live and breathe their values. A brand that is consistent in its actions is more likely to gain loyal followers and cultivate long-term corporate sustainability.

Modern consumers, particularly Millennials and Gen Z, are advocates for positive change. They demand more from brands and companies, increasingly wise to those whose claims ring false. One such example is prominent fast fashion brands who launch ‘sustainable’ or ‘recycled’ clothing lines while, behind the scenes, their predominantly female garment workers receive a less-than-living wage and suffer in deplorable working conditions. To use another example, many businesses also incorporate the rainbow flag in marketing efforts during Pride Month, while failing to support the LGBT+ community in any meaningful way.

Public relations activities fare better when brands are founded on an authentic, purposeful sustainability strategy.

The benefits of CSR

CSR programmes can be a powerful marketing tool. They can help a business to position itself favourably in the eyes of consumers, regulators and investors, boosting brand reputation. By commanding respect in the marketplace and gaining competitive advantage, CSR can result in better financial performance.

By default, business leaders who focus on improving their social impact will scrutinise business practices related to their value chain, consumer offerings, employee relations, and other operational aspects. This can result in new, innovative solutions which may also have cost-saving benefits. A business may reconfigure its manufacturing process to consume less energy and produce less waste; as well as being more environmentally friendly, it may also reduce its overheads.

CSR practices can boost employee engagement and satisfaction. Increasingly, people view their work as an extension of their own identities and convictions. When a brand invites them to share in its objectives, it can drive employee retention and attract quality candidates to roles.

Companies are embracing social responsibility due to moral convictions as well as profit – and reaping the benefits. All these effects of CSR can help to ensure that a company remains profitable and sustainable in the long term.

Champion CSR in your business sector

Are you passionate about environmental sustainability? Want to develop the skills and knowledge to pioneer global corporate citizenship? Interested in learning more about CSR activities?

The University of York’s online MSc International Business, Leadership and Management programme places particular emphasis on the challenges associated with global trade, marketing and sales, together with an overview of relevant management disciplines. You’ll be supported to build your knowledge of practice whilst developing an advanced theoretical understanding of the international business environment.

The importance of branding

The word branding originally came from a time when cattle farmers branded their animals with a hot iron to mark their ownership. Each farm or ranch would have its own brand mark usually made up of initials to identify its animals. Although branding and commerce have both grown significantly since then, the idea of the brand logo has not changed much: a simple, bold image that stays in the mind. But a logo is just part of a wider branding exercise that every company should carefully consider.

What is branding in marketing?

Branding is the way a company communicates itself both visually and verbally so that it becomes instantly recognisable to customers. A brand is an intangible concept and yet it forms a very clear idea of what a company does based on its values and identity. Brand identity comprises all visual communications, from the logo design to the typography and colour palette a brand uses on things like its packaging and website. By creating a cohesive identity, the brand experience becomes seamless, and the customer can identify the brand through cues like colour and style before they have even read the brand name. Although brand name is equally important in creating a memorable brand. For instance, the name Amazon recalls the diversity of the rainforest. wanted to become the number one destination for a wide variety of products. In fact, anything that the customer could possibly want, despite originally selling only books – the desire to expand was always there and evident in the name.

Once a visual identity has been decided, a brand guidelines document is usually created to communicate it across the business. By following these guidelines when designing marketing materials, employees and third parties (like a branding agency) can keep the brand’s aesthetics intact across all touchpoints. As well as the brand’s visual style, tone of voice is also very important, representing how the brand speaks. Tone of voice can either be part of the brand guidelines or a separate keystone document.

Why is branding important?

Branding can be the difference between success and failure, all depending on how well it is executed. It may be an area that isn’t given much thought, particularly if a company is hastily created or because founding members feel that things like graphic design are an unnecessary expense. And yet, without the consistency that branding provides, new products or services can easily get lost among competitors with a stronger brand. A powerful brand can create loyal customers, so it’s vital for a new company to think about how it wants to be seen before it launches.

Apple is often cited as a strong brand. It broke the mould on many fronts, from its name and logo having nothing to do with computers (although originally called Apple Computer Company) to its founder’s attitude and personality having a strong effect on the brand’s identity. Although there were originally three co-founders, Steve Jobs eventually drove the brand to prominence, and it was his desire for precision and minimalism that became inextricably linked with the brand. When he died, these design principles were maintained by Chief Design Officer, Jony Ive. Apple was also a change-maker in that its slogan, “Think Different” was purely inspirational and again, did not refer to the product. Other brands which have managed this successfully include Nike, with their “Just Do It” strapline. Both are short, snappy, and aspirational, so that the customer then connects the brand’s products with the chance to live and make real that philosophy for themselves. This creates brand equity, meaning that the brand’s value increases as people begin to perceive the products as being better and more desirable than other brands because of how they make them feel.

Part of brand management is assessing when a company may need a rebrand. This is not uncommon – it can just be a new logo, or it can be an entire rebranding exercise, changing the look and feel of a brand totally. This can be because the brand feels dated, or because the brand’s values have changed. If for example, a brand promise no longer feels relevant or true, updating that one aspect of the branding requires that all aspects be reviewed.

What are branding strategies?

A brand strategy is a document used by all stakeholders in planning the operations of a company. It is a plan that outlines the company’s goals for the brand, one year, three years, five years or further down the line. Activities are planned within the timeline to raise brand awareness among existing and new customers. These tend to be milestone events like new product launches and associated campaigns on social media or through more traditional advertising. Within the brand strategy there will likely be other strategies such as the content strategy, outlining the marketing assets which will be required like blogs, design templates, and copy for social media. The focus of these brand-building activities, especially for marketers, is on creating a brand experience, gaining competitive advantage, and improving financial performance.

As a company expands, it may have multiple products, ranges, and potential sub-brands, all with their own brand strategies. Large, global brands that have expanded over the years sometimes take the decision to unify the brand strategy and simplify communications. This may come after market research shows, for example, that the customer is confused by the differences between the various products, what they offer, and which one is right for them. Coca Cola’s One Brand strategy unites its various products like Diet Coke and Coca Cola Zero Sugar. The products have their own brands and target audiences, but at their core they are all part of the same family.

What is personal branding?

With the rise of social media has emerged the concept of personal branding. Your personal brand is how you present yourself to the world – particularly as a public figure or an expert in your field. 

Increasingly, with social media offering a platform for comment and opinion, many people are public figures whether they intended it or not. Either way, it’s important to think about how you appear to others, what you communicate, and how you communicate it in order to establish a strong personal brand. Someone’s business persona can become a brand in itself or a brand can grow out of a person’s popularity.

What is corporate branding?

Corporate branding is more about pushing the brand as a whole, rather than focusing on products or services. What are a company’s brand values? Does the company have a mission statement that resonates with the times in which we live? These are questions that investors or potential employees may ask. But it also applies to customers who buy into the brand as a whole and are most likely to be early adopters when it comes to any new products the company launches. 

Things that may come under corporate branding that are increasingly important to customers include Corporate Social Responsibility (CSR) and the company’s HR policies. In fact, how a company is perceived by potential employees is down to employer branding, another arm of corporate branding. This includes how the company nurtures its internal culture, how it treats its employees, and how this is communicated.

Learn more about branding in international business

Branding is key to all business and is particularly important to international businesses operating in different territories. Understanding the message that certain logos or words send, as well as the symbolism of particular colours in different cultures, is crucial when operating globally. 

Add to your knowledge and expertise with an MSc International Business, Leadership and Management from University of York.

What you need to know about mergers and acquisitions

Mergers and acquisitions (M&A) is the term used for the business of merging or acquiring limited companies (also known as private companies) and public limited companies (PLCs). It’s considered a specialism of corporate finance.

What is the difference between a merger and an acquisition?

A merger is when two separate entities combine. The most common structures are either a vertical merger or a horizontal merger. A vertical merger is when two or more companies come together, each with a different supply chain but the same end product or service. This kind of merger often results in synergies leading to reduced costs and increased productivity by gaining greater control of the supply chain.

A horizontal merger usually happens between competitors operating in the same space that want to increase their market share by joining forces and becoming one entity. A joint venture is slightly different – it involves two companies creating a new entity in which they both invest and share profit, loss and control. This business is entirely separate from both parties’ other companies.

Acquisition is when a larger acquiring company selects a target company to acquire through a buyout. Usually these are friendly acquisitions, but there can be what is known as a hostile takeover. This is when the acquirer aims to buy controlling interest directly from a  company’s shareholders without the consent of its directors. It is a completely legal M&A process but because of the ‘unfriendly’ nature of it, it can affect morale and damage company culture.

Consolidation can refer specifically to an amalgamation, which is the acquiring – and sometimes merging – of many smaller companies that then become part of a larger holding group. This is often seen in the creative industries or with startups.

Are mergers and acquisitions good for the economy?

Mergers and acquisitions tend to be good for the economy because they stimulate business growth, create new jobs and offer investment opportunities for all. Cross-border transactions can also help brands and businesses grow in new territories. However, if a company is looking to grow with the intention of merging or acquiring, it needs working capital to do this. A way of increasing capital is to offer shares on the stock market via an Initial Public Offering (IPO).

IPOs and the rise of SPACs

Famous IPOs in recent decades include when Facebook became a public company in 2012 and Alibaba’s record-breaking IPO in 2014. Facebook’s IPO was one of the most anticipated in history, with stock price steadily increasing up to the opening-day of May 18, and some investors suggesting a valuation of $40 per share in the build-up. The year before, LinkedIn’s stock had doubled in value on its first day of trading, from $45 to $90. Yet on the day, numerous factors – including computer glitches on the part of the Nasdaq stock exchange – led to Facebook share prices actually dropping considerably. This continued for the next couple of weeks with stock closing at $27.72 on June 1. Other tech companies took a hit and investment firms faced considerable losses. Nasdaq offered reimbursements, which its rival, the New York Stock Exchange called a “harmful precedent”. Despite these issues, the stock set a new record for trading volume of an IPO at 460 million shares.

Increasingly seen in global M&A, particularly in the US, is a Special Purpose Acquisition Company (SPAC). SPACs are created specifically to raise capital through an IPO and merge with another company. They’re not new, they’ve been around since the 90s, but SPACs have gained popularity with blue-chip private equity firms, investment banks like Goldman Sachs, and leading entrepreneurs. In turn, this kind of backing encourages more private companies to consider going public. 2020 saw the highest global IPO activity in a decade for the USA as well as the largest SPAC IPO in history.

The role of private equity

Private equity is capital which is not listed on a public stock exchange. Private equity firms are major players when it comes to M&A deals because they are powerful enough to keep on investing capital over an extended period of time. They have a pool of money accrued from previous M&A transactions, which then feeds into further deals. They also receive private equity from limited partners, pension funds, and capital from other companies. The firm, or fund as it is sometimes known, has good cash flow because of this.

Real estate is a form of private equity. There are private equity firms that specialise solely in the purchase of real estate, and by building a property portfolio they create further investment capital. Property is then improved and rented out, or sold on at a higher price, keeping the fund topped-up. Private investors see a return on their investment, and the money that’s left becomes working capital for the fund’s next venture.

Due diligence and pre-M&A analysis

One of the key steps in any merger or acquisition is the due diligence process. This is when investigations and audits are carried out to verify that all financial information provided by the target company is correct and that the purchase price is justified. Discounted Cash Flow (DCF) analysis is part of due diligence. It’s a method used to estimate the value of investment based on its predicted future cash flows.

Another important tool is Accretion Dilution Analysis. This is a basic test carried out before an offer is even made to determine whether a merger or acquisition will increase (accretion) or decrease (dilution) the Earnings per Share (EPS) once completed.

Intellectual Property (IP) must be taken into account as well. Acquisitions with an interest in gaining IP assets can have transaction values of billions. A thorough understanding of the complexities of such high-stake transactions is needed in order to derive precise valuation numbers when negotiating a deal.

Why work in mergers and acquisitions?

Global M&A is seeing growth in all sectors, even as the pandemic has seen some major companies fold. The way that we do business continues to be reshaped by world events, and the flux means that there are many business opportunities to take advantage of through mergers and acquisitions. Global M&A in financial services is seeing a boom with the start of 2021 being the busiest since 1980. The predominance of SPACs is set to spread outside of North America, and brings with it a demand for experienced managers and management teams.

Diversification acquisition will see larger companies offering size and scale to smaller companies which perhaps do not have the capital or resources to adapt in their offering, but which are otherwise doing well. At the other end of the spectrum, specialism may be needed, for example in healthcare, which is seeing a spike in demand for home healthcare solutions. Either way, business continues to seek a competitive advantage and mergers and acquisitions continue to provide this.

If you’re interested in learning more about the world of mergers and acquisitions, there are numerous finance-focused podcasts which look specifically at global M&A activity.

Learn more about mergers and acquisitions 

Mergers and acquisitions are a cornerstone of international businesses. Find out how you can sharpen your expertise in international business and mergers and acquisitions with the University of York’s MSc International Business Leadership and Management.