Vivian Lubrano: The world is becoming an increasingly diverse place, especially the societies that we live in and we invest in. It’s not just about social equity that companies need to focus on diversity, equity, and inclusion; it’s really about business fundamentals. They have to worry about how they can, in their future, incorporate and work with more diverse employees and more diverse clients.
Gayle Baldwin: So the companies that are thoughtful about assembling teams with different cognitive diversity, different ways of thinking, have the potential to really outperform. And I don’t think investors necessarily understand or are identifying that as a source of alpha.
Vivian Lubrano: And what’s very exciting is when we find companies that are finding that relevant diversity for them. There’s this technology company, Infosys, and they have to hire a lot of engineers coming out of college. So for them, historically, hiring men, finding engineers and engineering colleges, but they had to look inwards and they realized, “No, what I need is problem solvers. I can teach the engineering skills. I cannot teach critical thinking.” And that led them down the whole path of rejiggering their whole recruitment process, working with liberal arts and community colleges to hire liberal arts students that are good problem solvers and teaching them the engineering skills they need. So as a result, they actually drove growth, they’ve been able to deliver on their clients’ promises, and they’re also getting a more diverse employee base because community colleges are mostly women and minorities, and that’s really helping them with community engagement at the ground level. It’s been a big success.
Gayle Baldwin: The research organization IQVIA is another interesting example of how important human capital strategies can be. And their business model is to run clinical trials for pharmaceutical companies. And so winning there means carrying out the trial successfully, staffing up the patients, and then ensuring that they come back at the right interval so we can know if the treatments that we’re spending a lot of money developing are actually efficacious across an entire population. So they need to be able to recruit the patients, but also ensuring that the employees look like the patients and can understand what they’re going through, understand where they’re from. And so IQVIA has been really thoughtful about the types of people they recruit, but also the experiences and the community attributes that they’re looking for. So they’re much broader in considering human capital as a core part of their business. And we’ve seen success because they were able to, for example, during the COVID vaccine trials, win a much larger portion of that work because of their speed and successful track record.
Vivian Lubrano: So with the world increasingly more diverse, investors more diverse, employees more diverse, companies that can actually harness this, what we’ve seen in the data is that they can actually deliver on innovation, on efficiencies, on productivities. And that is why as an investor, we should really care about how companies are implementing their diversity, equity, and inclusion programs.
Gayle Baldwin: And particularly cognitive diversity—I think that’s the opportunity a lot of investors haven’t fully appreciated.