DEI and the meritocracy myth

A lot has changed since Donald Trump became US President. His attacks on diversity, equity & inclusion (DEI) policies began to be formalised day one in the White House and all DEI initiatives were scrapped, their web pages deleted. Nonbinary terminology was deleted and the president decreed that there are ‘two sexes’, with everyone to remain the gender they’re assigned at birth.

DEI policies are government and employment guidelines designed to improve equal opportunity by recognising people’s differences – such as gender, race, culture, sexual orientation, disability, neurodiversity, age – while valuing them equally.

The idea is that DEI supports creating inclusive workplaces where nobody is marginalised or discriminated against, and everyone feels welcomed and respected.

Not only does DEI offer protection from discrimination, it also make good business sense for companies. DEI helps companies attract more diverse talent, improving their odds of finding the best people for the job, and can support retaining talented people longer because it helps to create workplaces where everyone feels they belong. Ecosystems thrive when people can be their whole selves at work.

Put simply, DEI is all about creating a world where fairness is foundational.

There has been a conservative backlash against these ideas. Even before Trump took office, big US companies were beginning to dial down their DEI policies.

The Western world is now the midst of a cultural battle, with gender equality at the front line. US rollbacks on women’s rights range from the erosion of reproductive freedoms to the growing political rhetoric questioning the legitimacy of DEI initiatives and even the worthiness of diverse leaders.

Day one in the White House, its DEI and gender equality pages were deleted and replaced with Presidential Actions including the abolition of nonbinary gender terminology and the explicit termination of DEI initiatives within Federal Government. Around 2 million transgender Americans are seeing their rights eroded.

Even the words ‘woman’ and ‘disabled’ reportedly made an appearance on a list of US Government ‘Prohibited’ words.

Unfortunately, this dangerous and regressive tide is leaking out of the US and seeping into Australian culture and political discourse, too. We are beginning to hear similar anti-DEI and anti-feminist sentiments, including from our opposition leader, who has called for the abolition of DEI professionals in the public service.

All of this is unfolding against a backdrop of escalating violence against women – both in Australia and globally – within culture that treats women going missing on morning runs, or being stalked and murdered by colleagues as ‘business as usual’. The crisis being fuelled by a form of anti-feminist toxic cultural leadership embodied by certain podcast hosts, media personalities, and even politicians. 

One of the main arguments that companies use against DEI is that it’s a barrier to meritocracy, giving women and people from minority groups an unfair advantage, which then fuels resentment and division.

So let’s put that under the microscope for a minute to see what’s going on here.

Meritocracy is the idea that people are appointed, paid and promoted because they deserve to be – they have the right qualifications and experience for the role and that’s that.

Sounds legit, on the face of it. But who decides what merit looks like?

Picture the archetypal corporate senior leader and most people will describe a tall, white, self-assured, well-dressed male. This is because of unconscious bias. The world expects leaders to be confident, dominant – and often male. They went to the right college and know the right people. Research has even shown that male CEOs are on average almost 8cm taller than the average man, and that taller people earn more.

In another experiment, the exact same resume was rated more positively by Harvard students when it had a man’s name at the top compared to a woman’s. And a large international study found that applicants with English names received more than twice as many positive responses than those with non-English names.

This suggests that many people are getting ahead because they look or sound the part – because they’re better-looking or because they are men. Is that really meritocracy?

So, while critics of DEI argue that it distributes opportunity unfairly, it doesn’t take this unconscious bias into account. Meritocracy assumes an equal starting point that doesn’t necessarily exist; we know that not everyone has the opportunity to go to university, that career paths can take all sorts of unexpected directions, and that great leaders and specialists can emerge from anywhere.

The playing field is not level. Women are more likely to be doing unpaid caring or domestic work, less likely to be offered formal training, less likely to be invited along to the golf club to ‘talk shop’. They’re more likely to have had career breaks and not be available out-of-hours. In meritocracy-focused workplaces, the deeply entrenched stereotypes that hold women back are reinforced – which is of course a barrier to merit. Even the language used in recruitment ads can contain social cues that also create a barrier for women, particularly if they describe personality types. So women miss out on opportunities for career growth and equal pay.

Rather than blocking meritocracy, DEI policies work to break down these constraints and support merit-based opportunity, which thrives on fairness, the celebration of different strengths and the understanding that everyone’s journey might be different.

Critics often miss the fact that the impacts of DEI go beyond inclusive recruitment practices. Good DEI policies will address gender pay gaps, and support flexible work arrangements such as flexible hours, job-sharing or working from home, which allow women in caregiving roles to stay in the workforce. They provide paid parental leave for all genders, supporting parents and caregivers to manage childcare.  

DEI policies also protect women and nonbinary people from harassment at work and provide leadership development pathways, reducing barriers to advancement and encouraging representation at leadership level.

Short answer: Big yes.

Diverse teams support business goals of growth and competitiveness. They’re better able to relate to their equally diverse customers, use their mosaic of lived experiences to make better decisions, and prove more resilient to adversity.

During the Covid pandemic, companies with more women on the boards suffered fewer negative impacts.

An analysis of companies listed on the German Stock Exchange with at least 50% women on their boards revealed that they outperformed their male-managed counterparts in terms of both return and risk during the first year of the pandemic.

An analysis of 90,000 firms in 35 countries found a strong positive connection between increased director-level gender diversity and company performance.

McKinsey & Co found that companies in the top quartile for gender diversity at executive level were 25% more likely to have above-average profit than those in the bottom quartile in 2019. The same report found that ethnic and cultural diversity at executive level made an even bigger impact: companies in the top quartile made 36% more profit than those in the lowest.

And – super fact fans – super funds run by women have been shown to outperform male-dominated investment teams by around 0.3% per year, adding tens of thousands to their members’ retirement incomes!  

Business is also given a boost by trans and gender-diverse employees. When they’re able to bring their whole authentic self to work, it boosts business productivity by 3%, with additional benefits to customer service, team cohesion and creativity. LGBTQI+ inclusion is viewed positively by candidates and customers alike.

Basically, if everyone’s thinking like the same white alpha male, you’re not going to get a lot of creative new ideas coming through when you need them.

But the power of DEI can be felt beyond the workplace. DEI initiatives help challenge outdated gender roles and stereotypes and change cultural attitudes. They support better health and wellbeing. Greater participation and advancement in the workplace allows women and nonbinary people to build more wealth (including super), and achieve financial independence. Paid parental leave also encourages men’s participation in caregiving, distributing family responsibilities more fairly.

More representation brings more visibility, inspiring the next generation of girls to view themselves as leaders and boosting their participation in male-dominated fields. Women entrepreneurs outperform men in many areas, including revenue, return on investment and job growth.

And all of this serves to build more resilient economies, drive innovation and progress equality in society. In short, DEI is a vital building block for a better future, and we’re standing by it.

All of the investments in your super are screened to ensure they align with our shared values, including screens for gender representation on the boards of publicly listed companies.

And as a workplace, we find that our DEI policies help us do better.  Our staff report high levels of engagement and loyalty. Providing a safe space for self-expression encourages many different perspectives, which boosts problem-solving, collaboration and productivity. There are times when a different cultural or neurodiverse perspective has helped create some of our best work. We make space for employees experiencing debilitating menstrual or menopausal symptoms with paid leave entitlement, and support families with paid super on parental leave. You can even steal our inclusive workplace policies and adapt them for your own organisation – because we want more workplaces to benefit from them.

We’re here to dismantle systems that exploit people and nature and advocate for collective action, responsibility, and systemic change. 

DEI is one of the most powerful tools we have to fight against the old school ‘jobs for the boys’ mentality and the boys' clubs that have been pervasive in so many industries.

And who wants to see that continuing in 2025?! Not us. We’ll continue to be loud and proud on DEI.