Assignment Questions: (from article below)

1. How do you define diversity? What steps would you as a leader take to improve diversity?
2. What are the metrics for success? When do we say an organization is 'diverse enough'?
3. What are the competitive advantages to having a diverse workforce?
4. What does success look like when improving diversity within an organization?
5. What demographic groups are most impacted by environmental hazards? How are environmental and social/justice issues connected to diversity?
6. What would be the first steps you would take in improving diversity in your firm?
7. Should EDF adjust how it implements projects to foster more diverse partnerships?
8. Is there risk for EDF in partnering with organizations outside its typical models for project execution or core areas of focus?
9. What is the timeline for making effective operational changes, both internally and externally?

How Do We Get There? EDF Manages a New Diversity Plan

Emily Reyna, Director of Diversity at the Environmental Defense Fund (EDF), focused on the screen at the organization's headquarters in New York City. She had been in the newly formed position for just over a year and was urgently finalizing a presentation to the board of directors as traffic hummed on the street below. EDF's most current strategic plan outlined diversity as a key focus for the organization, and its Diversity Strategies and Recommendations were a direct product of the organization-wide strategy. At the end of year one of the plan, Reyna was in New York to report back to the board about both the progress and the challenges of taking a newly-drafted initiative from strategic plan into concrete, measurable action.

EDF was one of the largest and most influential nonprofits in the environmental space. It had shown a pragmatic, market-based approach could succeed in moving the needle on urgent environmental challenges across the United States and internationally. Yet the organization, from junior staff through senior leadership, as well as its outside partnerships, did not represent the shifting demographics of the United States, even though studies had shown that minorities supported higher levels of spending on the environment than whites.2 Reyna had served on EDF's internal diversity committee for several years prior to the adoption of the Strategies and Recommendations, and she saw this evident differential as a risk to securing meaningful and durable solutions, which were a core focus of EDF's mission.

Making these changes was not easy. Reyna scanned through the last of her slides and straightened her collar. As she read through Next Steps, she toiled with some knotty questions: How would EDF balance its core mission with making strategic moves toward diversity in a genuine way? What did success look like and what were the metrics? As a staff of one, did she have the capacity to make progress? Was EDF keeping pace with other environmental organizations? These tensions affected internal operations as well as how EDF interfaced with external partners.

EDF

The Environmental Defense Fund (EDF) was founded in 1967 by a small group of scientists on Long Island, New York. After research confirmed the negative effects of the insecticide DDT on local osprey populations, the scientists partnered with a lawyer and filed suit on behalf of the environment. Their campaign and partnerships led to the eventual nationwide ban on DDT. As the organization grew, it brought on economists to design market-based approaches. This marked the beginning of a new class of environmental organization focused on interdisciplinary partnerships towards environmental protection.

Structure and Partnerships

EDF operated with more than one million members and a staff of 500 scientists, economists, nonpartisan policy experts, and environmentalists. It had offices across the United States and abroad, focused on tackling local, national, and international environmental challenges. Beginning in the 1990s, EDF pioneered corporate partnerships to further the reach of its impact, and worked with large multinationals such as Walmart and McDonald's.3

Beyond corporate partnerships, EDF was unique among its peers for pioneering market-based solutions within the environmental realm. EDF's first major success was designing the cap and trade system to address the effects of acid rain caused by unregulated sulfur dioxide emissions. The approach was dubbed the "greatest green success story" of the decade, and EDF continued to integrate economic solutions across its work.4 For example, EDF worked to curb deforestation through REDD+ projects,i utilized catch shares to curb overfishing, and implemented habitat exchange systems to protect wildlife areas.5

EDF's two main sources of funding were memberships and contributions from foundations and institutions, with government grants and investments representing a small portion of the total funding stream (See Exhibit 1). Program services and projects accounted for its largest funding needs, with the remaining allocations covering development, management, and membership services (See Exhibit 2). EDF followed a strict policy against accepting corporate funding from partners, in order to maintain credibility and autonomy in its program objectives.6

Program Areas

EDF focused on four integral program areas: Climate and Energy, Oceans, Ecosystems, and Health, within which several projects functioned simultaneously.7 To address these challenges, EDF worked in communities across the U.S. and abroad, integrating economic concepts, policy tools, and market mechanisms toward initiatives such as lowering atmospheric pollution from natural gas, financing the transition toward sustainable fishing, addressing and mitigating business risks of unsustainable farming, and encouraging corporate responsibility.

Big Time Partnerships

EDF worked with major corporations across a broad range of sectors to improve sustainability efforts and diminish their environmental impacts. The organization forged its first corporate partnership with McDonald's to address the fast food giant's publicly criticized packaging waste.

In 1990, together with EDF, McDonald's implemented significant changes to their packaging and waste management system by discontinuing the use of polystyrene and bleached paper products. McDonald's incorporated postconsumer recycled content for in-house paper use and created post-consumer recycled standards for its supplier's shipping materials. As a result, McDonald's saved an estimated $6 million per year; over the decade following the partnership, and the company cut over 300 million pounds of packaging from its supply chain, recycled 1 million tons of corrugated boxes, and achieved a 30% reduction in overall restaurant waste.8

Since this first high-profile corporate partnership, EDF continued collaborating with market-leading companies across many sectors. Whether addressing the environmental impact of shipping operations within UPS and FedEx, or decreasing the waste from to-go cups at Starbucks, EDF continued to work with leading brands to develop best practices that shifted industries leaders toward greater sustainability.9

What is Diversity?

Diversity is based on but is not limited to race, gender, ethnic group, age, sexual orientation, education, personality, cognitive and physical abilities. It not only involves how people perceive themselves, but how they perceive others.10 These perceptions affect people's interactions and motivations, and they shape the workplace environment. Diversity can be seen as a strategic lens on the world of business a bridge between organizational life and the reality of people's lives.

A joint study by Stanford and UCLA that examined the influence of composition of racial and opinion diversity in small groups found that "when we hear dissent from someone who is different than us, it provokes more thought than when it comes from someone who looks like us."11 This conclusion reinforced the impact of diversity, in all of its definitions, on broadening thinking and consideration of alternative ideas.

Why Does Diversity Matter to Organizations?

A 2015 report by McKinsey & Company identified a statistically significant relationship between a more diverse leadership teamii and better financial performance. In the study, companies in the top quartile for gender or racial and ethnic diversity were more likely to have financial returns above their national industry medians. Other studies have shown that more diverse companies are better able to win top talent; improve their customer orientation, employee satisfaction, decision making, and innovation; and enhance the company's image all of which led to increased returns. It was concluded that diversity was mostly likely a competitive differentiator that shifted market share toward more diverse companies over time. Even with this information, 97 percent of U.S. companies have senior-leadership teams that fail to reflect the demographic composition of the country's labor force and population.12 (See Exhibits 3, 4, and 5).

Similarly, an article in Harvard Business Review reported that "...a team with a member who shares a client's ethnicity is 152% likelier than another team to understand that client."13 In addition, having even one team member with traits in common with the end user improved the understanding of the user by the entire team.

A Common Challenge: Diversity in Corporations

Diversity was a challenge in several industries, notably in high profile Internet technology companies. Transparency was an issue, making data hard to come by, but it was recognized that Silicon Valley had a diversity problem. After years of pressuring companies to release information, Jesse Jackson's Rainbow PUSH Coalition began working with tech companies to disclose workforce data, but some in the industry still refused to disclose.14 Facebook reported that in 2014 it had 81 black people employed among its 5,500 U.S. workers.15 A disparity in representation of male and female workers was also common in the tech industry.16 The lack of a diverse workplace may even present a risk, as female engineers from both Facebook and Twitter had filed lawsuits alleging unfair work environments in the companies.17 In addition, data showed that top schools were graduating black and Hispanic graduates with tech degrees at rates significantly higher than those graduates were being hired by leading tech firms.

The challenge was just beginning to be addressed in the tech industry, often with big public shows of support. In 2015, at the Computer Electronics Show, Intel CEO Brian Krzanich pledged $300 million to increase the company's workforce diversity.19Overall, the issue was not just a hiring pipeline issue; it was an issue of recognizing bias, creating value, and shifting culture.

As of 2015, the only countries to track employment by ethnicity were the U.S. and the U.K, but across all industries, companies were struggling to meet targets.20Health, education and hotels had the highest rates of female employment, while more manual labor-intensive sectors had lower female employment rates.21 A survey by Ernst and Young confirmed the same; gender diversity for consumer services and consumer goods industry was better than infrastructure-specific industries, such as telecommunications, oil & gas and mining. Agriculture had the most diverse workforce in terms of age distribution, probably because family- run farms continued to be common; the least age-diverse sectors were utilities and mining.22 The one thing missing, perhaps rather significantly, was that the diversity rankings accounted for the employment levels within minority groups but did not take their job positions into account.23

Defining the Problem: Green 2.0 - The Green Diversity Initiative

A 2014 report, called "The State of Diversity in Environmental Organizations: Mainstream NGOs, Foundations & Government Agencies," gave a sobering assessment of the lack of diversity in the environmental sector. The report was produced by Green 2.0 and written by University of Michigan's Dorceta Taylor.24It was the culmination of two years of surveys (2004-2006) that looked at the gender and racial diversity composition of 191 environmental non-profits, 74 government environmental agencies, and 28 leading environmental grant-making foundations. The surveys revealed that only 4.6% of Boards of Directors in the environmental non-profit sector were comprised of ethnic minorities, and the percentage of ethnic minorities on staff was 12%. Furthermore, ethnic minorities tended to be concentrated in the lower ranks and occupied less than 12% of the leadership positions, even as ethnic minorities and people of multi-racial backgrounds made up about 38% of the U.S. population.25

The report summarized the overall findings as follows:

"The Green Ceiling"

Despite increasing racial diversity in the United States, the racial composition in environmental organizations and agencies had not broken the 12% to 16% 'green ceiling' that had been in place for decades.

Unconscious Bias, Discrimination, and Insular Recruiting

Confidential interviews with environmental professionals and survey data highlighted alienation and "unconscious bias" as factors hampering recruitment and retention of talented people of color.

Lackluster Effort and Disinterest in Addressing Diversity

Efforts to attract and retain talented people of color had been lackluster across the environmental movement.

The Result: An overwhelmingly white "Green Insiders' Club."26

A focus on diversity within environmental organizations was not new, and it had long been tied to the environmental justice movement. For example, a foundational environmental justice report by the United Church of Christ in 1987 implicitly raised the question of whether an affluent, mostly white movement was considering the best interests of people of color and their communities.27 The issue had been in focus for decades, and the modern discourse began on Earth Day in 1990 at the behest of environmental justice organizations. Fred Krupp, then Executive Director of EDF, was quoted in 1990 saying, "The truth is that environmental groups have done a miserable job of reaching out to minorities.''28

The report also painted a picture of steady but slow progress. Among the successes highlighted was the EDF Climate Corps program, launched in 2008, in which graduate students were trained in energy efficiency and management strategies and become fellows within a wide variety of host organizations. The program matched diverse students with host institutions and drew students from minority-serving institutions such as Morgan State University, Howard University, and Clark Atlanta University.29But the results of the report showed that diversity was increasingly scarce when one looked higher on the organizational chart. There was a fundamental question: does a diverse intern program create a pipeline for organizational change? (See Exhibits 6 and 7).

Public Responses and Reactions

The "State of Diversity in Environmental Organizations" report received much public attention. A wide range of news organizations, such as The Guardian, GreenBiz, and NBC News, covered various aspects, including the report's findings, organizational reactions, and opinion pieces. The pressure to improve was real, and the public eye watched. Green 2.0, aka The Green Diversity Initiative, committed to shepherd the issue forward into the future and keep pressure on the groups for progress. Green 2.0 was an initiative dedicated to increasing racial diversity across mainstream environmental NGOs, foundations and government agencies, and it advocated for data transparency, accountability, and increased resources to ensure that these organizations increased their diversity.30

One of the ongoing efforts was to encourage transparency of diversity information within nonprofits and foundations. Green 2.0, D5, and Guidestar, a nonprofit information source, partnered to create a diversity data questionnaire for the Guidestar data transparency platform. A push for transparency occurred not just from Green 2.0, but also from the leaders of prominent foundations.31In a 2015 press release from Green

2.0 and Guidestar, Fred Krupp, President of EDF, was quoted saying "founded by scientists, EDF understands the power of data to inform and catalyze change. The GuideStar survey gives us the opportunity to share progress on EDF's diversity strategy, and helps hold us accountable to our commitments. While we have increased the representation of people of color in our organization, we must continue to work hard to reflect the environmental values of all sectors of society. This is the only way to fully achieve our mission."32

Where the Rubber Meets the Road: Does Diversity Affect Program Implementation and Strategy?

#blacklivesmatter

On December 4, 2014, The Sierra Club posted the following message on its Facebook page:

"The Sierra Club stands with the public good. We believe in a society that is first and foremost just, fair and rational - one that abhors brutality and favors equality. Whether it's the planet itself or the people who inhabit it, we hold the ideals of respect and reverence in the highest regard. For these reasons, we stand in solidarity with the organizations who are protesting and demanding justice in the deaths of Eric Garner, Michael Brown and every other victim of injustice. #blacklivesmatter"33

The post received 6,528 likes and prompted 634 comments, as of December 2, 2015, displaying a wide range of reactions, including questions of why an environmental group would get involved in a political movement about race and police violence. Sierra Club Executive Director Michael Brune wrote a blog post to respond to this question, in which he stated that the environmental movement has had a less-than perfect record when it comes to race, that communities of color were often the ones affected by pollution, and that it was not enough for an organization to become racially diverse, but it must understand its employees' experiences in the workplace, and that the fight against injustice fundamentally relates to environmentalism.34

Similarly, the Natural Resources Defense Council published blogs discussing the Black Lives Matter movement and its relation to environmental organizations.35 But while other major environmental organizations discussed the issue, EDF chose to remain at a distance, even though some in the organization thought it would be worthwhile to comment publicly.36This raised many important questions for an organization that was striving to improve diversity. Should embracing the value of diversity extend beyond the boundaries of talent and organizational management? Is it worthwhile to become involved in the public discourse of issues beyond traditional areas of competency? Does the organization's approach line up with the fundamental aim of incorporating diverse perspectives? Do these public statements put nonprofits at risk of losing donors?

California Cap and Trade Policy and Environmental Justice Organizations

In 2006, California enacted the Global Warming Solutions Act (AB 32), which aimed to reduce California's greenhouse gas (GHG) emissions to 1990 levels by 2020.

To accomplish this, AB 32 authorized the establishment of a market-based cap-and-trade regulation alongside complementary emissions reduction measures, and the enforceable cap-and-trade program officially began on January 1, 2013.37 EDF co-sponsored the legislation and defended it in court and at the polls.38 The cap-and-trade system aligned with EDF's mission and philosophy to use market-based approaches to achieve environmental results.

Not every environmental group saw the AB 32 cap-and-trade regulation as a win, though. For example, the Center on Race, Poverty, and the Environment stated that cap-and-trade "has a disproportionate negative impact on communities of color because those communities do not receive the benefits of on-site reductions when major polluters buy pollution reductions from somewhere else."39 The Center fought for alternatives to AB 32 and was joined by other environmental justice organizations in California voicing similar concerns.

EDF was not an environmental justice organization; it partnered with businesses and work on market- based approaches. There was a sense of some lack of trust from groups that saw EDF as compromising and not taking a hard enough approach. EDF also recognized that it wanted to be more connected and relatable to a broader swath of society.40These conflicting views and strategies highlighted several questions for EDF as it considered implementing its Diversity Strategy. Given that environmental justice leaders brought the diversity issue to light, was there a problem with pursuing strategies that conflict with active environmental justice organizations? What should be the strategic approach going forward and how would it relate to EDF's work? Was EDF including diverse stakeholders in its programs, or was it unintentionally excluding some?

Diversity in Peer Environmental Organizations

EDF's efforts were in step with a developing focus on diversity and inclusive partnerships by peer organizations. Leading environmental nonprofit organizations such as the The Nature Conservancy (TNC), National Resource Defense Council (NRDC), and The Sierra Club were making public moves to bring diversity into acute focus within their mission and workforce.

TNC commitments to diversity were written into its core values, called the Voices of The Conservancy. Its Executive Team's Diversity and Inclusion Steering Committee led an internally focused strategy that cut across the spectrum of underrepresented groups.41 The two different internship programs were successful in bringing individuals with diverse backgrounds into the organization, allowing exposure to the issues and helping build environmental leaders.

Newly elected leaders at NRDC and The Sierra Club had made public their commitments to diversity and the environmental challenges faced by underserved populations. Rhea Suh, the daughter of Korean immigrants and a former assistant secretary of the Department of Interior, started her tenure at NRDC calling on the need to, "broaden the environmental movement and ensure it reflects the great diversity of our nation."42 Similarly, Aaron Mair, as the first African-American president of Sierra Club, bolstered the organization's commitments to environmental justice and partnerships. The Multi-Year Diversity, Equity, & Inclusion Organizational Plan preceded Mair's appointment as president and laid the groundwork for how The Sierra Club would operationalize its goals.43 Strategic plans and commitments to diversity could be found in action across the spectrum of environmental organizations.

EDF's Strategy

According the EDF's Strategic Plan, to remain a global leader in creating innovative solutions to the world's most pressing environmental problems, EDF needed to adapt to rapidly changing demographics in the

U.S.and to shifting socio-economics around the world.44 EDF realized that to achieve durable environmental outcomes, it needed to include the broader society and actively engage groups that cared as deeply about the environment as EDF did. Diversity had been integral to EDF's strategy, but the need for a more inclusive environment became more pronounced in 2014, due to increased emphasis within various departments. In 2014, EDF's five year Diversity Strategic Plan included goals and milestones to be achieved by 2020, and specifically called attention to Diversity. (See Exhibit 8).

The EDF Diversity Committee was composed of 70 members, and it had several sub-committees dedicated to increasing diversity initiatives and awareness throughout the organization.45 EDF divided its goals into internal and external components. Internal objectives had the twofold agenda to attain inclusive mindsets to strengthen the organization and cultivate capabilities toward becoming a more culturally competent organization. External focus lay on forging diverse, inclusive, and collaborative partnerships rooted in common aspirations and values, aimed at collectively tackling the world's most serious environmental problems.46

Organizational Strength

The new Diversity Strategy aimed to first establish an organizational baseline and define diversity metrics to evaluate progress. Initial focus areas included age, race, and gender, while a dedicated staff would work with human resources to integrate diversity in recruiting and retention. The recruitment procedure was to be modified to hire from a more diverse pool of candidates by expanding recruitment beyond elite universities47 and retaining younger candidates by fostering career advancement opportunities. To ensure accountability, department and program goals were incorporated into the performance evaluation for managers.48Furthermore, the plan aimed to diversify the board.

Cultural Competency

Tracking employee attitudes and experiences over different time spans was planned, to help elucidate the areas in which EDF's staff needed support. Developing an onboarding program in diversity and inclusion for new staff and providing training to promote engagement for existing staff members were the primary methods to develop cultural competency. Needs-based training was planned to include program-specific and country-specific trainings for international staff and staff working with international partners. Incorporating an equity framework to assess social equity outcomes aimed to embed inclusion into planning and decision making for all major projects and policy initiatives. Some previous and new incentives for capacity building included initiatives such as a one-year fellowship focused on minority applicants, the Constituency Engagement Award, and internal environmental justice grants.49

Partnerships

EDF had formal and informal partnerships with various organizations supporting its environmental missions across all programs. Identifying and developing relations with grassroots and grasstops organizations were planned to help create an ecosystem of diverse partnerships. Under the diversity strategy, the constituent partners would share joint goals based on diversity metrics to ensure long-term collaborations and trust. Individual programs were free to choose program-specific partnerships, but they would be responsible for training their constituent partners. Incentivized programs for working groups were aimed at relationship building with Latino and Hispanic Americans, African Americans, Asian Americans, Native Americans, EJ communities, more diverse socio-economic communities, and youth.50

Looking Forward

The boardroom started to fill up. Reyna watched a homogeneous but gradually diversifying group pour over a full agenda on which her presentation was just one line. She looked once more at the presentation and reflected on the key challenges and questions that might come up at the board meeting:

Could EDF implement its Diversity Strategy in a genuine way without changing its approach?

EDF's donor base responded well to directly tangible projects. How would it respond to these strategic changes?

How should EDF create new diverse partnerships with groups that it had not worked with before? How should it choose new organizations with whom to partner? What if those organizations did not agree with a market-based strategy?

How should EDF balance internal and external goals and build a pipeline to attract and retain diverse new networks?

Would a focus on diversity impact EDF's mission? What were the blind spots?

Should EDF stick with the current strategy of working with powerful organizations and influencers, or should it seek a broader range of partners in the future?

Reyna closed her laptop, and the meeting started. She knew her work had just begun.