The Power of CEO Leadership in Building Truly Inclusive Workplaces

Today’s CEOs recognize that inclusion and diversity (I&D) is a business imperative, not just a moral one. The likelihood of financial outperformance increases by 39% on executive teams that have gender and ethnic diversity.

By embracing I&D, CEOs encourage diverse perspectives, thus fostering the creativity and innovation that drive competitive advantage. However, these efforts must extend beyond policy statements—they require active and strategic leadership at the highest levels.

“Inclusive workplaces start at the top,” said Johnny C. Taylor, Jr., SHRM-SCP, president and chief executive officer of SHRM. “It is up to the CEO to establish an inclusive work culture, not in name only, but by setting and enforcing inclusive policies and empowering leaders under them to embrace inclusive practices.”

The Business Case for Inclusion

I&D creates tangible benefits across the organization, including stronger financial performance and higher retention. Around 76% of job seekers consider diversity an important factor when evaluating potential employers, according to Glassdoor.  Meanwhile, Gartner found that gender-diverse and inclusive teams outperformed gener-homogeneous, less inclusive teams by 50%.

Beyond improving performance, an inclusive culture reduces turnover and increases employee satisfaction. A SHRM study found that supply chain workers who say their company is not effective at achieving inclusion-related progress are over four times more likely to say that they often felt they wanted to quit within the past six months. These outcomes highlight how inclusion drives both retention and productivity—critical factors in today’s labor market.  

“Inclusion isn’t just the right thing to do—it’s the smart thing to do,” said Steve Wigginton, CEO of Clarvida, a leading behavioral health and social services platform. “Diverse teams consistently outperform homogeneous ones, driving better decision-making and innovation.”

Wigginton is leading a collaboration with the SHRM Foundation to help organizations tap into underutilized talent pools, including older workers, those with criminal records, veterans, military spouses, opportunity youth, and individuals with disabilities.

Addressing Systemic Barriers and Biases

Despite growing efforts toward inclusion, systemic barriers and biases remain entrenched in many organizations. One such barrier is biases toward people living with a disability. A Boston Consulting Group survey of 28,000 employees found that, while 25% reported having a disability or health condition that limits a major life activity, just 4%-7% of the workforce are considered employees with disabilities. This indicates a significant gap.  

Further, a 2023 SHRM study found that nearly half (47%) of employees with invisible disabilities, such as autism and ADHD, have not disclosed their conditions to their employers, highlighting the need for leaders to create safe, inclusive workplaces.  

CEOs must lead by example, championing fair hiring and promotion practices, while actively working to develop a culture where all employees feel respected and valued.  

Opportunities for All Is Prosperity for All  

In today’s labor market, inclusion is no longer just a nice-to-have—it is essential for business survival and growth. The U.S. faces a stark reality: There are 8 million job openings but only 6.8 million unemployed individuals to fill them, creating a critical talent shortage.  

This gap underscores the importance of embracing untapped talent pools. Notably, organizations are increasingly doing so, as evidenced by the employment rate for disabled individuals reaching 22.5% in 2023—the highest since 2008, according to the Bureau of Labor  Statistics.  

By focusing on inclusivity and expanding hiring efforts to include underrepresented groups, companies can not only fill these positions but also unlock the potential for higher productivity and innovation. 

The CEO’s Role in Driving Change

Ultimately, CEOs hold the responsibility for championing inclusivity at every level of the organization. As top executives, they set the tone and shape the company’s culture, making it crucial for them to not only support I&D initiatives but also actively lead them.  

At Clarvida, Wigginton has led new inclusion initiatives to encourage open communication, including an email tool that allows employees to give feedback anonymously. Additionally, he’s initiated training programs, leadership surveys to assess progress, and fireside chats to unite leaders and employees.

When CEOs model inclusive behaviors and hold themselves and others accountable for progress, they set the stage for true cultural transformation. CEOs who embrace this responsibility and focus on tangible actions to remove barriers and biases will reap the benefits of a more engaged, innovative, and loyal workforce.