Making Small Talk: The Case for LGBT Diversity and Inclusion

Thank you for that introduction and thank you for inviting me here today to share my experiences—and the experiences of Dow—with Lesbian, Gay, Bisexual, and Transgender issues … the “why” and “how” of creating a successful Employee Resource Group for your LGBT community.

Now, the easiest way to start this conversation would be to share with you the facts and figures … the logic behind why support for LGBT employees is so crucial for your business.

And I’ll get to that in a minute. I’m an engineer, after all; I love data and the data is overwhelming.

But when it comes to THIS issue, it’s not just about the data. So I want us—you and me—to start someplace else. In fact, I want you to rewind the clock to early this morning when you arrived for work.

I imagine millions of employees around the world just like you approached this Monday morning the same way you do every Monday: with equal doses of dread and excitement. Dread because there’s a five-day workweek ahead … excitement because you’re doing work you enjoy and you’re surrounded by good people.

In every office I’ve worked in around the world—Thailand, Japan, Midland, Michigan—it’s the same kind of routine.

We come into the building, we see colleagues and co-workers in the hallway or at the coffee pot, and somebody begins a conversation with a simple question: “How was your weekend?”

Questions like that are a crucial part of team building and trust formation. We share stories, get to know our co-workers, and become invested in them as humans … and not just anonymous cube dwellers.

But … imagine for a moment the closeted LGBT employee who gets this question. The LGBT employee who’s scared of what others might think … who’s scared of being discriminated against … or maybe even losing their job.

What do they do … what do they say … when they get this question?

“How was your weekend?” isn’t small talk for them. It’s a minefield of potential disaster.

They might want to say something like, “My partner and I went to a great concert Saturday night.” Or “My partner and I found a new hiking trail and camped out all weekend.” Or maybe they want to say, “You know, we found out this weekend that my partner is sick … and I’m really scared.”

But they don’t say that. They either avoid the conversation all together or they make up a bland story and keep the real stuff—the human stuff—bottled up. They don’t share because they don’t want to be ostracized, shunned or fired simply because someone discovers they are gay or lesbian.

About four to five percent of employees in the U.S. and Canada self-identify as LGBT. Four percent of PIMCO’s workforce, in other words, has this potential problem not just every Monday … but also on Tuesday, Wednesday, Thursday and Friday. Not all of them, of course. But data suggests that about 75 percent of any organization’s LGBT population remain in the closet … because they’re too scared to come out.

I know this from first-hand experience. I was one of those employees.

For nearly 30 years, there was a part of my life I simply did not bring to work … a part of my real self I kept hidden.

That takes a lot of work and energy, by the way. It’s stressful—physically, emotionally, mentally—to hide who you are day after day.

I finally decided to come out after a serious health scare. Battling through—and surviving—stage 4 cancer has a way of redefining your priorities.

And I made a decision: continuing to hide who I was … was one stress I just didn’t need any more.

That was three years ago. And I can tell you the support I received from my colleagues at Dow was overwhelming. From the CEO and the Board to my peers and direct reports … they stood by me and they continue to stand by me.

By this time in Dow’s history, I suspected they would. After all, Dow had a long history of supporting LGBT issues. We formed our first resource group for LGBT employees in 2000 … 16 years ago. We call it GLAD for Gay, Lesbians and Allies at Dow.

Eighty percent of the GLAD participants aren’t even LGBT. They’re what we call Allies—people who aren’t LGBT but who lend us very visible workplace support.

So even though I was still fearful of what the reaction might be … I knew that I had a greater chance of acceptance at Dow than any other company in the world.

Not every LGBT employee is as fortunate as I was.

It’s amazing to me that—a year after the Supreme Court ruled in favor of same-sex marriages—over half of America’s LGBT population lives in states where private companies can discriminate based on sexual orientation or gender identity.

In other words, LGBT individuals can legally marry in these states … AND private employers in those same states can fire them if their wedding photo ends up in the local newspaper.

California and New York are two of the more enlightened states when it comes to protecting individuals based on sexual orientation AND gender identity. And Toronto? You are blessed to live in a country and a province with some of the most advanced LGBT rights and workplace protections in the world.

But if you’re an LGBT employee in the 28 states that still sanction discrimination, chances are high that you’re very hesitant to out yourself. To the contrary, you’re often forced to lead two separate lives: the private one and the public one.

No small talk at the water cooler for you. It’s just too risky.

Did you know that the majority of LGBT employees—even in states with non-discrimination laws—and even at forward-thinking companies like PIMCO—still choose to remain in the closet?

Many make a personal choice not to come out—and every individual faces that decision differently. But a lot simply cannot come out without the fear of discrimination.

The cumulative effect on their well-being, on their performance, and on their company’s competitiveness … is staggering.

Thirty percent of these employees feel distracted from their work.

Forty percent are depressed.

And they are 70 percent more likely to leave their jobs in the first three years than other employees.

That’s why employee resource groups like PIMCO PRIDE are so critical. Your LGBT co-workers need—and deserve—the same rights and freedoms as everyone else. The right to bring their whole selves to work every day. The right to be treated fairly. The right to be judged based on merit and not because of their gender orientation.

To do anything else would be in direct contradiction to the most basic, most human, and most universal law of the land: The Golden Rule.

So I salute you—and I thank you—for launching this initiative. As someone who has struggled with coming out for most of my adult life, I can tell you it is the right decision—the morally correct decision—to make.

Now, if you’re still on the fence about this—if you’re not convinced yet—let me add this: It’s also the right business decision to make.

A study just a few years ago found that companies with greater levels of diversity and inclusion showed an 80 percent improvement in business performance over companies with less diversity.

Another study demonstrated that, for every one percent rise in the rate of gender and ethnic diversity in a company, there was a 3-9 percent rise in sales revenue.

Yet another showed that public companies with diversity were 45 percent more likely than those without to have expanded market share year over year.

The reasons why are simple. Employees who feel connected to the workplace—who feel free to speak their mind without fear of being “outed”—and who feel connected to their co-workers—are more engaged and feel more empowerment.

Ideas flow more genuinely. People trust one another more. Collaboration rises.

Did you know, by the way, that natural work groups perform cognitive tasks 32 percent better when LGBT team members are “out” as opposed to when they are closeted?

Call me an old-fashioned engineer if you want—but if you show me a way to increase team performance by 32 percent I’m going to pursue it.

In fact, that’s one of the things we’re doing at Dow right now. We’re working hard to create a kind of liquid network where ideas flow up, down, and sideways naturally. But we can’t do that if part of the network is blocked off … if even one part of our workforce doesn’t contribute.

To say we value diversity at Dow is an understatement. We covet diversity at Dow. Diversity of thought. Diversity of backgrounds and nationality. Diversity of gender and race and orientation.

Dow is a stronger, more capable, more connected company when we tap into the diversity of experiences and knowledge of ALL of our employees.

That will only be more critical moving forward.

Consider this: In ten years, 75 percent of the nation’s workforce will consist of millennials. From a business perspective, if we want to attract, retain and engage those millennials, we must have a culture—not just policies and not just resource groups—but a culture that embraces diversity.

This future workforce supports LGBT employment equality more than any generation in history. Ninety percent, in fact, believe that the idea of NOT treating LGBT employees equally is simply unacceptable.

As a businessman, I cannot afford to lose that future workforce. We need their thoughts … we need their energy … we need all of the diversity they bring. So this is business critical.

And yet, I would also tell you that diversity—by itself—is not enough. This is an important distinction.

Many companies have pursued diversity … but failed to improve performance or employee engagement. In fact, sometimes they create more problems than they hope to solve because they took the Noah’s Ark approach to diversity—you know, bringing in two of each kind and claiming success.

They forgot that it’s not about quotas. It’s not about having policies on the wall and then checking the box on tolerance. It’s about inclusion.

This is an essential point and I want to make sure you understand the difference. Quotas don’t work. Policies are important—but they only get you part of the way.

What does work—and we see it at Dow—is creating an environment—an omnipresent culture—where everyone can bring their whole selves to work.

It’s diversity AND inclusion.

And that is not simply the role of management. It’s not simply the role of your PIMCO PRIDE network. This is job for all of you.

So what can you do moving forward? What can each of you do to ensure PIMCO thrives and it’s a place of inclusion and ideas and energy?

Let me suggest three things based on Dow’s 16 years of experience.

First, remember that this is not a “nice-to-do” initiative … it’s a “must-do” initiative.

PIMCO—like Dow, like the Ford Motor Company, like Johnson & Johnson and every other organization on earth—will either fail or succeed based largely on the efforts of its employees.

Strategy will only take you so far. Eventually you must have engaged employees who can implement the strategy. That means everyone on the team. It means a collaborative, trusting and supportive culture. It means not only respecting one another’s ideas, but also respecting one another as individuals

The best and brightest employees of tomorrow are demanding that kind of environment. The employees of today deserve that environment. And the companies that fail to deliver risk their own futures.

This is not a “nice-to-do” … it’s a “must-do.”

Second … be respectfully patient.

What do I mean by “respectfully patient?”

I mean don’t expect wholesale changes—unmitigated success—or even 100 percent acceptance—overnight. But don’t use that as an excuse to quit trying, either.

Culture change takes a lot of effort and a lot of time.

I told you Dow’s LGBT resource group is 16 years old. The first couple of years were tough. We had a lot of employees who simply did not like what we were doing and they were pretty vocal.

A few said it was “disgusting” and “perverse.” A few said things that aren’t appropriate for public consumption.

We even had some customers who pushed back on us.

We were respectfully patient.

We listened. We responded. We kept the dialogue going. And we persevered.

Even with a constant push and executive support, though, it has truly been a journey. We were a decade into the initiative and internal surveys showed that LGBT employee engagement still lagged significantly behind our workforce as a whole.

So we kept pushing and pushing until, slowly, the culture of acceptance changed. Trust levels went up. The engagement numbers rose. And last year, I’m proud to say, the engagement of our LGBT employees was—for the first time—on par with our entire population.

And the really amazing thing? Over the past four years, total employee engagement has gone up, too. I’d like to think there’s a strong correlation there.

Finally, I would tell you this.

You must live this every day. You—each of you—must live this.

Be a role model.

Be an unapologetic advocate.

Even if you aren’t LGBT, I guarantee you know someone who is.

Be their ally.

Be that steady voice of inclusion.

You’ve all heard the saying by now: If you see something, say something.

If you see behavior or hear language that erodes inclusion, use it as an opportunity to educate … gently.

And lead by example.

Make sure you use inclusive language yourself … and be aware of your own biases and how they might impact your teams.

Be aware that otherwise simple questions—“How was your weekend?”—are not so simple for everyone to answer.

And then carry that new knowledge forward to others.

Become a leader on this issue … for yourself, for your co-workers, and for PIMCO.

Let me close by congratulating you for taking this step.

PIMCO PRIDE can do more to improve your business—and improve employee well-being—than any other single act or initiative.

I’m convinced of that because I’ve seen similar results at Dow.

But I also know it takes courageous personal leadership—an unwavering commitment—and a lot of patience to achieve that goal.

But it’s worth the journey. As someone who stayed in the closet for nearly 30 years, I can tell you it’s worth every bit of effort you put into it and then some.

It will make a difference in the lives of your employees—all of them—and it will make a tremendous difference in the success of PIMCO.

Thank you for inviting me here this morning. Thank you for hearing my story and Dow’s story. And thank you for all you’re doing to promote diversity AND inclusion at this fantastic company.