Nearly Two-Thirds of Employers Don’t Allocate Enough Resources to DEI
If a looming recession means tightening the budget, business leaders advise strongly against reigning in DEI initiatives.
According to research by the Society for Human Resource Management and the Boston College School of Social Work, 65% of employers say DEI efforts are critical to staffing and retention, 63% reported that their organizations allocated “little to no resources” to DEI. The article goes on to explain that while a recession may be on the horizon, experts advise strongly against cutting back on DEI programs. “In fact, during times of massive change, DEI may be even more important to ensure workers are treated fairly and thoroughly,” Kathryn Moody, senior editor of HRDive.com, wrote.
Additional research in DEI is also being conducted by the Center for Accounting Transformation, which is examining the DEI journeys of CPA firms and organizations served by CPAs in finance roles.
“For years, we’ve heard the most critical issue in accounting is staffing,” said Kiera Speed, an inspiration logistician for the Center. “Research has repeatedly shown DEI initiatives can make an organization more successful by increasing staff performance as well as lowering turnover rates. While there are numerous DEI studies available, very few are specifically related to the accounting profession.”
Speed continued, “Our primary objective is to understand what resources people need to advance the DEI practices in their organizations.”
In a recent article in Accounting Today, “The Many Faces of Diversity,” Speed’s sentiment was echoed by other accounting leaders who emphasized that, rather than be a movement or a policy change, DEI needs to be incorporated into business culture and that inclusiveness and commitment to diversity must be represented by leadership and emphasized with managers.
“Everyone has a role in making the workplace more diverse, inclusive, and equitable,” said Crystal Cook, the director of diversity and inclusion at the American Institute of CPAs and the Chartered Institute of Management Accountants. “However, leadership has to empower everyone below them, lead by example, put these things in action, and make them a priority.”
Donny Shimamoto, CPA.CITP, CGMA, the founder and managing director for IntrapriseTechKnowlogies said, “I think right now the biggest piece that’s not being talked about is the impact on middle management. The top-level people are talking about DEI, but there isn’t a lot of action, so it feels to the staff like a lot of it is just lip service. Middle managers bear the brunt of their staff’s frustrations with lack of progress, and don’t have insight into what’s happening at the top.”
Further compounding the complexity of the issue is the tendency to focus only on a few specific marginalized groups, rather than embracing all. The article states, “According to Shimamoto, it’s because diversity is not always understood in all its complexity, which results in marginalized groups often being excluded from initiatives that are meant to help them.”
He said, “What concerns me is that Asians are not being included in racial minorities. We’re sometimes included in the analysis, but we’re not included much in the policies. That just kind of struck me because this is DEI and, if you’re not inclusive, then aren’t you being just as bad as what we’re trying to fight?” His point was perhaps demonstrated by the rest of the article, when no one mentioned Asian or Pacific Islanders as being of concern or targeted by their DEI initiatives.
Other interesting notes in the Accounting Today article include:
- Only 7% of Black people in accounting felt like they were treated the same way as their non-Black colleagues.
- 75% of organizations globally have identified DEI as a priority, but only 53% of organizations took direct action toward DEI programs, and the number falls to 40% for companies with less than 100 employees.
- The number of female accountants grew by 35% between 1970 and 2022, which is a significantly stronger progression than what is observed for professionals of color.
Shimamoto, who created the Center for Accounting Transformation, will be leading a free webinar on December 13, “The Diversity, Equity and Inclusion Journey in the Accounting Profession: What Research Tells Us.” During the webinar, four thought leaders will join Shimamoto to discuss the results of research conducted by the Center, CalCPA, the Institute of Management Accountants, International Federation of Accountants, and bbr companies, sponsor of a shared research initiative between AAM and CleralyRated. Attendees will take a deeper dive into what resources people need to mature the DEI practices in their organizations and learn from other experts about other DEI-specific research being conducted to help firms accelerate their DEI business practices to create deeper trust and a greater feeling of belonging among their employees.
- Claire Costin, Pamplin School of Business, Assistant Professor; University of Portland
Claire Costin received her Ph.D. from the University of Texas at San Antonio. She received her Masters in Business Administration (MBA) from St. Edward’s University in Austin, Texas and her Bachelor’s of Music in piano performance from the University of Texas at Austin. Claire’s dissertation is about the impact of social capital on earnings management, and she is interested in how cultural factors affect managerial decision-making. She is working on several projects related to implicit bias and how it affects accounting professionals. Prior to pursuing her Ph.D., Claire worked in practice as an auditor in Austin and remains a licensed CPA in the state of Texas. She is also a member of the Association of Certified Fraud Examiners (ACFE). Her teaching interests are in the areas of financial accounting, auditing, and forensic accounting, and she enjoys sharing her research findings with students and engaging them in conversations about how human behavior impacts the accounting profession.
- Stephani Mason, CPA, School of Accountancy & MIS, Assistant Professor; DePaul UniversityStephani Mason is an assistant professor in the School of Accounting & MIS at the Driehaus College of Business. Mason has more than a decade of experience working in investment management at JP Morgan Investment Management, the JP Morgan Private Bank and US Trust. Her academic research interests include the impact of valuation and accounting standards, financial regulation and corporate governance on financial reporting, capital market behavior, investing/financing decisions and executive compensation. An active member of the PhD Project Faculty Alumni Association and the American Accounting Association, Mason has served two-year terms as the planning committee co-chair for the PhD Project Accounting Doctoral Association, the diversity section of the American Accounting Association and the International Accounting section of the American Accounting Association.
- Bonnie Buol Ruszczyk, Founder & Owner; bbr companies
Bonnie Buol Ruszczyk is the founder and owner of bbr companies where she serves as an outsourced marketing director and growth consultant for professional services firms nationwide. Additionally, as a Cornell-certified diversity, equity and inclusion consultant, she conducts training and helps firms start and expand successful DEI programs. Finally, she recently acquired the Accounting MOVE Project, the only annual benchmarking research and advocacy report that equips accounting and advisory firms to detect, develop and drive competitive advantages from diversity initiatives and trends. Since 2010, MOVE has measured both demographic data and workplace culture to understand what works now, in today’s economy, to advance women and other underrepresented groups in accounting firm leadership.
- Kathy Johnson, CPA, CFF, CGMA, MBA, Vice President Forensic Accounting at J.S. Held LLC Chair, CalCPA Diversity, Equity and Inclusion Commission
Kathy Johnson is a CPA, CFF, CGMA and holds an MBA from Pepperdine University. Prior to joining J.S. Held she held positions such as CEO where she provided services as an expert witness in forensic accounting and litigation support, and Vice President of Financial Planning & Analysis enabling her to sharpen accounting skills critical to providing financial litigation support. Ms. Johnson is also an Adjunct Professor of Accounting at California State University, San Bernardino and Long Beach, The University of Redlands, and The University of California Riverside. She is also a current member of AICPA and CalCPA’s Forensic Services Section, AICPA’s Relations with Judiciary Subcommittee, and currently serves as a member of the California Board of Accountancy Enforcement Advisory Committee. Other community involvement include chair for CalCPA’s Diversity, Equity and Inclusion Commission and Vice President of the Alliance of Black Women Accountants.
Professionals in the accounting industry are encouraged to complete the 10-minute survey to contribute to the most robust DEI study in the profession, and additionally encouraged to join the discussion on December 13.