Forward-looking multinational corporations understand that they need to create inclusive work environments in order to recruit and retain top talent, and stay competitive in the global marketplace. But they face a significant hurdle to doing so globally: Many countries still host significant levels of societal discrimination against LGBT people.
Discrimination creates hugely significant negative impacts on economies. Professor Lee Badgett of UMass Amherst estimated in a study commissioned by the Williams Institute of UCLA that economic discrimination against LGBT people in India could cost the country 1.7% of their total GDP – a jaw-dropping US$30.8 billion a year.
The economic damage caused by societal animus towards LGBT people is not unique to developing economies. Last year, a study found that the United Kingdom could be losing £11.2 billion ($17 billion/€15.6 billion) in annual GDP due to the pressures and stresses lesbian, gay, bisexual and transgender engineers encounter in the workplace.
When LGBT employees do not feel comfortable being themselves at work, innovation and productivity suffer. At the recent World Economic Forum’s Annual Meeting in Davos, Kenji Yoshino and Sylvia Ann Hewlett introduced an important new study sponsored by Out Leadership and several Out Leadership member companies. According to “Out in the World,” one in five closeted LGBT workers say that hiding their identity reduced their ambition and caused them to work less. And almost 30% of closeted respondents said that hiding their identity kept them from speaking up or sharing innovative ideas at work.
The study was based on a multinational survey of 12,206 respondents from 10 countries (Brazil, China, Hong Kong, India, Russia, Singapore, South Africa, Turkey, the United Kingdom, and the United States); its global reach makes it one of the most comprehensive pieces of market research into LGBT inclusion in the workplace.
42% of LGBT employees around the world reported that they had experienced discrimination in the last five years because of their identity. Given the prevalence of such negative experiences, it’s no surprise that a huge number of the LGBT respondents – 64% – said they were in the closet at work. The study found that 80% of LGBT workers in Russia are not out at work. But even in an economy that is usually thought to be relatively accepting of LGBT people, such as the United Kingdom, 53% of respondents say they’re in the closet at work.
Increasingly, smart business leaders are recognizing that the enormous productivity toll created by such discrimination represents an opportunity for competitive differentiation – that letting LGBT people be themselves at work unlocks a tremendous resource. As a result, the private sector is leading the way in creating safe, inclusive workplaces in many countries. Nevertheless, many openly-LGBT employees at major financial services and legal services companies, including very senior business leaders, have indicated to Out Leadership that they would have serious concerns about relocating to countries with anti-LGBT laws. When highly qualified candidates turn down assignments abroad because of concerns about the legal environment, it’s bad for everyone.
Out Leadership seeks to empower the leaders of our member companies to begin to persuade LGBT-unfriendly countries to adopt inclusive laws and policies. We produce Business Briefs for CEOs who travel to countries such as India, Singapore and Japan, providing succinct overviews of the national landscape for LGBT people in each country, as well as crisp, economic- and business-focused talking points about how the current situation for LGBT people in each country shapes their business decisions.
Even in the West, there is still work to be done to make sure LGBT employees feel comfortable in the workplace. In the United States, 46% of LGBT people are in the closet at work. Of course, workers can still be fired for being gay in 29 states – or for being transgender in 30. Indeed, 43% of LGBT workers report having been fired, harassed, or denied promotion at work because of their sexual orientation or gender identity. Unfortunately, a large majority of Americans incorrectly believe that LGBT people are already protected from employment discrimination nationwide – all of which are reasons why we’re also producing an Out Leadership CEO Business Brief for the United States.
At our OutNEXT Summit for emerging LGBT leaders last summer, David Mixner noted that although the work continues for LGBT people to achieve true equality under the law in the United States, it is also now incumbent upon LGBT people in places like the US and Western Europe to work to help LGBT people who are in real, mortal danger in places like Saudi Arabia, Nigeria, and Indonesia. We look forward to continuing to partner with the world’s most influential businesses to do so.
Todd Sears is the Founder and Principal of Out Leadership, a global strategic advisory firm that connects leaders across the world’s most influential industries to create business opportunities, cultivate talent, and drive LGBT equality forward.