Diversity, equity, and inclusivity ratings trial

Many NGOs, researchers and campaigners are working hard to stop society’s scales being tipped heavily in favour of some people and against others based on characteristics such as gender, ethnicity, disability (or lack thereof), class, and more.

A number of readers have asked if Ethical Consumer can incorporate a company’s DEI efforts into our ratings system, so we explored this idea. We don’t currently have plans to adopt this rating, for reasons explained in this article, but we wanted to share the findings and get your feedback.

DEI work aims to balance the scales

Would it shock you to hear that just 10% of Fortune 500* CEOs are women, and 0.02% are black? And about half went to private school? Probably not. (*Top 500 corporations worldwide as measured by revenue.)

We’re not particularly fussed about how many people from marginalised backgrounds have made it into the billionaire club, but stats like these do illustrate how our demographics influence our life chances.

Inequality between people with different identity characteristics is clear in the average UK population too: black households are on average the poorest, almost 1 in 5 LGBT people have experienced homelessness in their lifetime, and women are over twice as likely as men to face domestic violence.

Something needs to change ...

These issues should primarily be the job of the government to address, but progress isn’t happening fast enough.

While corporations don’t hold the same centralised, elected power as governments, they hold huge sway in our society (a power which is often abused, including through lobbying). But sometimes they do use their power to push for progressive change – for example Lush’s approach to fighting animal testing in the cosmetics sector and beyond.

We incorporate DEI into some of our work already, for example, in features that look at the gender pay gap in the financial sector and banks’ historical links to the slave trade. We also always ensure that at least one recommended or Best Buy brand in our shopping guides is an affordable price. And when possible, we address accessibility issues.

Who did we consult?

When considering how to incorporate more DEI into our work, we engaged closely with a few organisations, either through conversations or reading their publications:

• Anti-Oppression Collective and Vanessa-Faloye Consulting
• As You Sow
• The Class Work Project
• The Mentor Project
• Mind
• Scope
• Stonewall

Some organisations firmly supported the idea of a DEI rating, but others warned the complexity would mean any attempt would just be an “exercise in tick-boxing”. With that in mind, we thought it worthwhile to trial a rating and get feedback from readers.

The DEI rating

We tried to formulate an overarching methodology that would give us some indication of what brands are doing in relation to DEI that we could apply across all sectors.

We settled on the six criteria below, each of which was recommended by at least one consulted organisation:

1. Does the company acknowledge DEI shortcomings in its own operations?
2. Does it show an awareness of intersectionality? (The concept of intersectionality highlights the ways systems of inequality intersect with one another, creating unique dynamics and effects.)
3. Does it report on pay gaps other than gender? (Gender pay gap reporting is already a legal requirement for UK companies with 250 or more employees.)
4. Does it report on staff demographics and provide a narrative on how it will become more representative of the broader population in terms of diversity?
5. Does it have a strong link with a relevant organisation working on a DEI issue?
6. Does it have a funded Employee Resource Group working on a DEI issue?

Small companies, such as MUD Jeans, received an exemption if they met any criteria, or partial exemption if they showed evidence of making some effort.

How do companies score?

We rated a selection of clothing companies against these criteria in September 2022. Multiple ticks in a box means it addressed multiple issues.

(NB As this is a trial, we’re not encouraging you to contact companies about these ratings.)

Our reflections on these scores

These scores are insightful in that they distinguish between (a) companies that acknowledge the DEI work they can do to make society fairer overall, versus (b) those that aren’t saying much, if anything.

However, perhaps large companies can pay for DEI consultants, so they know the right things to say. Smaller companies might be nervous about getting it wrong, and therefore don’t speak up, plus many small businesses lack the time and financial resources to develop comprehensive policies on these issues.

ASOS (4/6)

ASOS publishes ethnicity pay gap reports, states a commitment to anti-racism, and acknowledges that problems such as racism exist within its own operations. It has an ongoing partnership with the Gay & Lesbian Alliance Against Defamation (GLAAD) and makes unisex clothing, plus it addresses intersectionality in staff DEI training programmes.

Patagonia (1/6)

Best Buy in our outdoor clothing guide Patagonia only met criterion 1: having a public commitment to anti-racism. It has got a trans ambassador who explores gender identity through outdoor activities, and it donates to organisations that combat racism and gender inequality, though this wasn’t counted in our methodology because a lot of corporate whitewashing involves donating to charities. However, it does feel like Patagonia’s score is perhaps too harsh, suggesting that the current methodology might need adjusting.

Future coverage of DEI in our research

While we don’t intend to implement this rating as it is, we want to ensure we are addressing the DEI issues that matter most to our readers, where possible.

As we continue to develop our new ethical ratings system, greater scope for incorporating relevant DEI issues into our ratings may emerge, and we will also continue addressing DEI issues in the text accompanying our score tables.

Your feedback

As this is a trial, we’re not encouraging you to contact companies about these ratings. But we sought feedback from our readers and followers. 

We've now gathered the feedback and written a follow up article on what you thought of the trial and rating for diversity, equity and inclusion.