DEI Survey results virtual connection

January 26, 2023

Women of color at the executive management and senior levels are departing at twice the rate of their population size – highlighting challenges in retention at the most senior ranks of the commercial real estate industry.

While both the representation of women and people of color in North America improved generally year-over-year, for women of color at the executive management and senior level their significant rate of departure in 2022 highlighted a challenge for the industry in terms of retention.

That was one trend highlighted during this week’s DEI Survey results virtual meeting, which discussed the results from the 2022 Global Real Estate DEI Survey. The virtual discussion was held jointly by Ferguson Partners, NAREIM, NCREIF and REALPAC and to which more than 360 people registered.

• To download the presentation from the meeting, click here.

• A replay of the meeting is available on YouTube by clicking here.

Departure rate, twice as a high

During a presentation and whole room Q&A, it was revealed that 14% of all 2022 departures at the senior level of CRE organizations were by women of color, despite the fact that women of color only represented 7.6% of the senior-level employee population. The same data also showed that firms were hiring and promoting women of color at roughly the same rate as their current representation.

A similar trend was seen at the executive management level. Women of color made up 4.9% of the population among executive management professionals, and while firms were making strides in hiring women of color for the most senior roles (8.2% of all hires in 2022 were women of color, twice their population rate) the departure rate was significant as well. For women of color in executive management positions, the departure rate was 8.5% - twice their current representation.

ABCD & Sponsorship

The virtual Q&A however also raised how firms can address retention challenges – including by sponsoring people of color, versus just mentoring them and adopting the ABCD of DEI - amplify, boost, connect and defend.

“A mentor will answer questions, give prep, but a sponsor will lead the way,” said one speaker. “When we think about amplifying, that’s the sponsor equivalent of self-promotion, boosting is the sponsor equivalent of self awareness, connecting is the sponsor equivalent of impression management, and connecting is the sponsor equivalent of helping change others’ perceptions.”

Key takeaways

Other key takeaways discussed during the DEI Survey meeting, included:

• Overall representation by gender and ethnicity improved in North America. The representation of women in North America increased 3.7% between 2021 and 2022, increasing to 42.5% of the workforce in 2022, up year-over-year from 41% in 2021. The representation of people of color in North America increased year-over-year by almost 8% - from 29% in 2021 to 31.3% in 2022.

• Almost 54% of organizations participating in the 2022 Survey had adopted formal DEI programs and strategies – up from 47% in 2021. Formal strategies requires accountability for DEI initiatives and is approved by senior leadership.

• There was a correlation between firms adopting formal DEI strategies and those seeing greater representation of people of color within the organization.

• For firms with a dedicated DEI budget, the average among spent per employee each year was $225. Only 30% of firms had dedicated DEI budgets.

• Moving beyond gender and ethnicity metrics. Member questions focused on how to collect data beyond gender and ethnicity and into areas such as disability, veteran status, socioeconomic background and sexual orientation among others. During the Q&A, members asked whether investment managers should be the ones leading the push to collect more data or industry associations.

• ERG-lead data collection: In collecting LGBTQ+ data, one member shared that their firm’s employee resource group had led the data collection efforts rather than it coming from HR. The member said the ERG handled all communications and explained to staff: “The company wants to understand our experiences better, you don’t have to fill this in, but it’s a way for the company to start understanding our population.”. It was ERG-led versus management-led, the member concluded.

• The chat discussions also took this further, with one member saying: “This is such an important topic - to build trust with employees through transparency (why we're collecting/what we'll be using it for/reporting it out thoughtfully), confidentiality (who has access to the data, etc.), and authenticity (messaging in a people-centered way)”

• Another chat said: “Even if we cannot collect the data, we can support ways for employees to connect along dimensions of interest to them, like employee resource groups.”

• Members also asked how to increase representation of minority and women-backed businesses among vendor relationships and service providers, particularly if institutional investors or partners require certain things, such as using a Big 4 accounting firm.

To download the presentation from the meeting, click here.

To watch a replay of the meeting discussion, click here for the YouTube video.

The attendee list can be accessed by emailing Sanyu Kyeyune at skyeyune@nareim.org