We are in 2024, and today, Diversity, Equity, and Inclusion (DEI) are more than just trendy buzzwords. For Indian companies, prioritising DEI is no longer just about ticking a compliance box or making your website look progressive. It is a strategic move that can unlock massive potential for growth, innovation, and talent retention. But here’s the catch: ignoring DEI could cost you more than you think. So, why Indian companies must prioritise DEI, and what happens when they don’t? Let’s break it down.
What exactly is DEI?
DEI stands for Diversity, Equity, and Inclusion. These three concepts are interconnected pillars of a fair and inclusive workplace. When integrated, DEI ensures that every employee, regardless of their background—be it gender, disability, race, or sexual orientation—receives equal opportunities to succeed. It is about more than just numbers or quotas; it is about creating an environment where everyone can thrive.
- Diversity: The representation of different identities, experiences, and backgrounds in the workforce.
- Equity: Ensuring that everyone has access to the same opportunities and resources tailored to their specific needs.
- Inclusion: Creating a sense of belonging for all employees so they feel valued and heard.
Indian companies must understand that failing to promote DEI is not just an ethical issue—it is also a legal one.
Indian companies must prioritise DEI: The hidden costs of ignoring DEI
Ignoring DEI initiatives does not just affect the employees who are directly impacted; it can lead to financial penalties, talent loss, and damaged reputations. Several Indian laws mandate compliance with diversity and inclusion principles. Moreover, failing to adhere to these can result in heavy fines and even imprisonment.
1. Gender discrimination in the workplace
Laws like the Equal Remuneration Act 1976 ensure that men and women receive equal pay for the same work. Non-compliance with gender equality laws could lead to fines of up to ₹20,000 or imprisonment for up to a year.
Similarly, the Transgender (Protection of Rights) Act 2019 mandates safe and equitable work environments for transgender employees. This act is particularly crucial because it ensures that transgender individuals receive the same opportunities in recruitment, promotions, and work benefits.
Companies are required to provide accessible infrastructure like unisex toilets and appoint complaint officers to handle grievances related to discrimination. Failure to comply with this law could lead to imprisonment for up to two years. That emphasises the severe consequences of neglecting DEI.
2. Inclusion of persons with disabilities
India’s Rights of Persons with Disabilities Act, 2016, sets strict requirements for organisations to ensure equal opportunities for employees with disabilities. These obligations include providing barrier-free infrastructure, accessible working environments, and reasonable accommodations. Ignoring these can lead to penalties ranging from ₹10,000 to ₹5,00,000, depending on the severity of non-compliance.
Unfortunately, many Indian companies have yet to embrace these inclusivity measures fully. By ignoring them, not only do they risk penalties, but they also miss out on the diverse talents and perspectives that employees with disabilities bring to the table.
3. Sexual harassment and safe workplaces
The Sexual Harassment of Women at Workplace (Prevention, Prohibition, and Redressal) Act, 2013, is another vital piece of legislation that businesses must adhere to. Companies are required to implement a policy that prohibits sexual harassment, constitute an Internal Complaints Committee, and conduct awareness workshops. Failing to meet these requirements could result in fines of ₹50,000.
In addition to legal penalties, overlooking DEI can result in increased turnover and poor morale. When employees feel unsafe or discriminated against, they are less likely to stay loyal to their employer, leading to higher recruitment and training costs.
Beyond compliance: Why DEI is a strategic imperative
While compliance with legal requirements is necessary, the benefits of embracing DEI extend far beyond avoiding penalties. Prioritising DEI can enhance innovation, boost employee satisfaction, and improve overall business performance. Here’s why:
Boosting innovation
When diverse minds come together, the variety of perspectives fosters creativity and innovation. Companies that promote diversity often come up with unique solutions and better ideas.
Attracting top talent
A strong DEI strategy positions a company as an employer of choice. Job seekers, especially younger generations, are increasingly looking for workplaces that value diversity and offer an inclusive culture.
Better financial performance
Studies have shown that diverse companies perform better financially. Organisations that include a wider array of voices in decision-making often make better business decisions, leading to higher profitability.
Why Indian companies must prioritise DEI: Rethinking the ‘Cost’ of DEI
Some companies may still view DEI initiatives as expensive or cumbersome. However, the truth is that investing in DEI pays off in the long run. It is not just about avoiding fines—it is about creating an empowered and motivated workforce that drives success. Moreover, failing to embrace DEI results in much higher hidden costs, including legal battles, bad publicity, and disengaged employees.
The road ahead: What Indian companies must do
The focus on DEI in India is still evolving, but it is essential for companies to stay ahead of the curve. Here’s what Indian companies need to do to ensure they are prioritising DEI:
- Formulate Clear Policies: Establish DEI policies that are visible and accessible to all employees. It includes creating an Equal Opportunity Policy and a robust grievance redressal system.
- Ensure Accessibility: Ensure your workplace is accessible to everyone, including employees with disabilities. This includes physical spaces and digital infrastructure.
- Regular Training and Sensitisation: Conduct workshops and e-learning courses to ensure employees and management are aware of unconscious biases and the importance of inclusivity.
- Monitor Progress: Review your DEI initiatives regularly to ensure their effectiveness. Track diversity metrics and take immediate action when you spot gaps.
Conclusion: DEI is non-negotiable
Indian companies must realise that DEI is not just a trend or compliance checklist—it’s a crucial element for business success in the modern world. By embracing DEI, companies not only protect themselves from legal repercussions but also unlock greater innovation, attract top talent, and foster a positive workplace culture.
The message is clear: Why Indian companies must prioritise DEI is not just about ticking boxes; it is about creating a sustainable and thriving future for both employees and businesses.
And hey, if you are still not convinced, just remember—would you rather pay a fine or build a future-ready workforce that’s happier, more productive, and more innovative? We thought so. Let’s get to work!
Disclaimer: The views expressed in this article are based on the writer’s insights, supported by data and resources available both online and offline, as applicable. Changeincontent.com is committed to promoting inclusivity across all forms of content, which we broadly define as media, policies, law, and history—encompassing all elements that influence the lives of women and gender-queer individuals. Our goal is to promote understanding and advocate for comprehensive inclusivity.
