INTERNATIONAL LAW: Cross-Border Diversity Initiatives for Recruiting and Retention

Vol. 31 No. 2

By

Donald C. Dowling Jr. is a partner at White & Case LLP in New York City.

Equal employment opportunity and diversity play a huge role in U.S. domestic human resources administration and employment law compliance. So it might seem that, when it comes to propagating workplace diversity globally, American multinationals enjoy a clear head start. But very different demographics abroad make this head start less advantageous than it may at first appear. Indeed, in some contexts overseas, too much experience with U.S. diversity initiatives might even be a drawback.

How, specifically, does a multinational drive equal employment opportunity (EEO) compliance and foster workplace diversity across jurisdictions? U.S. EEO and diversity tools were originally honed for the atypical, rarefied environment of U.S. discrimination, harassment, and diversity law and for the unique demographics of the United States. So they do not always work well abroad, at least not without significant retooling.

Employers promoting diversity across borders must begin by confronting a tough but central question: What do we mean when we say we want “diversity?” Very different demographics and “core diversity dimensions” overseas mean that the answer will not be the same abroad as it is domestically within the United States.

The U.S. understanding of “diversity.” U.S. diversity experts these days expand their efforts beyond the three narrow but well-defined “diversity dimensions” that U.S. government statisticians track via America’s mandatory employer-diversity-reporting form, known as EEO-1. The EEO-1 parameters are: (1) gender, (2) “Hispanic or Latino” ethnicity, and (3) “race,” defined as “White,” “Black or African American,” “Asian,” “American Indian or Alaskan Native,” or “Native Hawaiian or Other Pacific Islander.”

To a modern U.S. diversity expert, confining a corporate diversity initiative just to the EEO-1 categories would be a far too narrow endeavor. They speak broadly of “diversity of backgrounds,” “diversity of opinions,” and “diversity of experiences.” Diversity professionals also cultivate diversity among age groups, sexual orientations, the “differently abled,” and other groups, legally protected and not legally protected alike.

The fact remains, however, that domestically within the United States the sine qua non of a “diverse” workforce actually is rooted in our three “old school” EEO-1 categories. No American would consider a workplace of all white, non-Hispanic men “diverse.” On the other hand, for many it would be easier to maintain that a workforce is substantially “diverse” if made up of half men/half women and boasting big percentages of Hispanics, blacks, Pacific Islanders, Asians, and Native Americans—even if it somehow turned out that this gender and race-balanced workforce included only able-bodied heterosexual Ohio-born Democrats over age 40.

The international understanding of “diversity.” For years now, the importance of “diversity” has been growing outside the United States. A study by the Lee Hecht Harrison firm once found that two-thirds of employers worldwide see employer diversity programs as key retention tools. Some countries now actually mandate specific diversity initiatives: South Africa requires workplace diversity plans, for example, and Brazil and Germany require affirmative action for the disabled.

So in today’s diverse, multicultural world markets, all multinationals, regardless of where headquartered, should be thinking about how to foster inclusion and equality of employment opportunity within workforces worldwide and how to recruit and retain diverse workforces.

But in formulating a diversity program abroad we come right back to our definitional question of metrics: What do we mean by “diversity”? Like plugs on our American electrical appliances, our three EEO-1 metrics will not fit overseas. The disconnect between how we define race in the United States and how other countries define race (and ethnicity) explains why workforce demographic diversity programs hatched from U.S. EEO-1 metrics are bound to fail if transplanted overseas.

Three viable cross-border diversity initiatives. Any U.S.-headquartered multinational intending to launch, across regional or worldwide workforces, a diversity initiative focused on recruiting and retention should resist the urge to transplant its U.S. approach. Instead, American diversity initiatives should be retooled using internationally appropriate metrics and a global understanding of “diversity.” There are at least three alternative designs a multinational might use in transforming a made-in-the-U.S.A. diversity initiative into a viable international one:

1. Cross-cultural understanding. International project teams with members from different countries can run into misunderstandings because of deep-rooted cultural differences. Even within a region as well-integrated as Western Europe, work styles differ and underlying assumptions and attitudes diverge across a team of, say, British, French, German, and Italian employees. Cross-cultural understanding sessions can address these problems with training focused on attitudes. But these soft training programs are so distinct from hard demographic “diversity” initiatives focused on recruiting and retention metrics that using the “diversity” label here is perhaps disingenuous. One human resources manager once suggested keeping the distinction clear by labeling such training as “Global Cultural Competence” or “Global Cultural Awareness” programs—eschewing the word “diversity” entirely.

2. Gender inclusion. Homogeneous racial demographics in many overseas markets may block efforts at racial diversity, but gender equity is good everywhere (except in Saudi Arabia, where in many respects it remains illegal). Women are underrepresented, especially in leadership roles, in so many overseas workforces. Gender inclusion is becoming a hot issue in many jurisdictions in such areas as Europe, where there can be requirements regarding gender balance on corporate boards of directors. Some U.S. multinationals therefore focus their outside-U.S. diversity efforts on promoting gender inclusion, reserving race and ethnicity for their domestic diversity programs.

3. Local racial/ethnic diversity. Bold multinationals that take international workplace diversity seriously enough to confront the irrelevance of the three U.S. EEO-1 categories abroad might promote racial/ethnic inclusion by tailoring overseas diversity metrics to the different “core diversity dimensions” of their overseas workforces. It makes absolutely no sense to track the “Hispanics” and “African Americans” within a workplace in, say, Russia, India, Chile, or South Africa. Ask instead: Which “diversity dimensions” and demographic categorizations are locally appropriate in our overseas locations? Then implement meaningful demographic benchmarking metrics on a localized basis. Going beyond racial/ethnic categories, how can a global diversity program cultivate diversity among age groups, sexual orientations, and disabilities? Bold cross-border diversity initiatives of this sort remain rare. But they may be the next frontier.

Conclusion. “Core diversity dimensions” and the very definition of what it means to be “diverse” differ widely from one country to the next across our increasingly heterogeneous “global workforce.” Any multinational launching cross-jurisdictional work rules, international human resources policies, global code of conduct provisions, or other border-crossing initiatives that champion diversity in overseas recruiting and retention should modify existing U.S. domestic diversity policies and offerings—or even completely start over when working abroad.

ABA Section of International Law

This article is an abridged and edited version of one that originally appeared on page 4 of International Law News, Spring 2013 (42:2).

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