Claudia Brind-Woody's presentation from Nykredit's LGBT-conference in Copenhagen August 2013

1. © 2005 IBM Corporation
The Cost
of
Thinking Twice
Claudia Brind-Woody
IBM Vice President & Managing Director
Intellectual Property Licensing

2. © 2005 IBM Corporation
IBM’s Diversity Policy is Based on Corporate Values:
Dedication toDedication to
every client’severy client’s
successsuccess
Innovation that matters – for ourInnovation that matters – for our
company and for the worldcompany and for the world
Trust and personalTrust and personal
responsibility in allresponsibility in all
relationshipsrelationships

3. © 2005 IBM Corporation
Our customers, suppliers and
strategic partners are increasingly global
and multi-cultural
We must position ourselves to communicate with
and market to a diverse population
Global Marketplace
Our customers have diverse needs
We must reflect our clients diverse population to
be responsive to their needs and expectations
If we assume all of our customers are
straight, we will be wrong 5-10% of the time
Meeting Client Needs
The competition to attract and retain
top talent is increasing
We must be employer of choice to attract
develop and retain key skills (inclusive culture,
supporting talent development, flexible working
practices)
Creating a great place to work
Our competitive advantage is through being
a leader in innovation
IBM needs diverse perspectives and talents to
enhance creativity and innovation
Making Diversity our Advantage
Diversity & Inclusion is important to our business:

4. © 2005 IBM Corporation
Updated July 27, 2013
Source: http://en.wikipedia.org/wiki/File:World_homosexuality_laws.svg
Same-sex Marriage:
The Netherlands (2001), Belgium (2003), Canada (2005), Spain (2005), South Africa (2006),
Norway (2009), Sweden (2009), Argentina (2010), Iceland (2010), Portugal (2010), Denmark (2012),
Uruguay (2013), Brazil (2013), France (2013), Uruguay (2013) and New Zealand (2013)
Mexico City and Quintana Roo
US States: MA (2004), CT (2008), IA (2009), VT (2009), NH (2009), Washington DC (2010), NY
(2011), WA (2012), ME (2012), MD (2013), RI (2013), DE (2013), MN (2013), CA (2013).
Brazil (upgrade from civil union)
Death Penalty:
Iran, Saudi Arabia, Yemen, Mauritania, Sudan, United Arab Emirates, Nigeria, Somalia
Globalization looks different for LGBT Employees…

5. © 2005 IBM Corporation
 McKinsey
 Organizational Excellence:
– Those with diverse senior management teams outperformed those with no
diversity on 9 criteria – and score increased significantly when diversity
reached critical mass (a third of the team)
 Financial Excellence: 89 European-listed companies with the highest
diversity in senior leadership positions outperformed the industry averages
of Stoxx Europe 600
– 10% higher return on equity
– 48% higher EBIT
– 1.7 time the stock price growth
 Catalyst – “Why Diversity Matters” August 2011
 Improving Financial Performance
– Catalyst studies since 2004 have shown that companies that achieve diversity
in their management and on their corporate boards attain better financial
results, on average, than other companies
• Return on equity (53% higher)
• Return on sales (42% higher)
• Return on invested capital (66% higher)
The Business Case for Diversity: the “Bottom Line”

6. © 2005 IBM Corporation
LGBT inclusion motivates employees to do their personal best
•Gay staff who are ‘out’ and supported are 20-30% more productive (Harris Interactive, 2006)
•How companies treat LGBT constituencies can be a leading indicator for how other
diverse groups are treated
The Business Case for Diversity: productivity, performance, loyalty
Valuing & accessing diversity are key elements in high performance
• Business is a Team Sport – diverse teams win
LGBT inclusion increases revenue:
New markets and new customers: 78% of LGBT consumers are extremely
likely or very likely to consider brands known to provide equal workplace benefits for their
employees, including LGBT workers.
Cultural relevance sells: Research shows that talking to the diverse consumer
in their language/culture gains and retains customers.
Brand Loyalty high: 94% of gay and lesbian consumers say they are loyal to
brands that advertise in gay media

7. © 2005 IBM Corporation
Why do LGBT employees “Think Twice”?
Why do we hesitate to come out?
 Safety and Bullying
 Lack of Trust
– Fear of job loss
– Fear of damage to promotional opportunities
– Can only see downside in coming out
– Discrimination is hard to prove
 Messages from Families of Origin, Religion, Governments and
Society in general
Percentage of LGBT people – 5% to 10%
What % of your employees are LGBT? Do you know?
What % of women do you have in your company? Do you know?
Percentage with LGBT people in their lives – 80%

8. © 2005 IBM Corporation
The Business Cost of Thinking Twice:
• 25 to 75% of LGBT employees encounter extensive discrimination in the workplace
• 55% of LGBT employees facing discrimination report direct work impact
According to research from the Center for Work-Life Policy:
• 21% of closeted employees trust their employer vs. 47% of out employees
• 23% of closeted employees are entrepreneurial vs. 35% of out employees
• 52% of closeted employees feel stalled in their career vs. 36% of out employees
• 48% of closeted employees are satisfied with rate of promotion vs. 64% of out employees
• 59% of closeted employees fee “very loyal” to companies vs. 70% of out employees
• 36% of LGBT employees will change careers if they encounter continued discrimination and are
3 times more likely to leave if not satisfied with their rate of advancement than those who are
• An employee who feels “safe” will weigh the additional risks when considering changing
employers
• Lesbians face barriers that are attributable to both their lesbian status and their status as
women. A 2009 Catalyst study reports that Lesbians report “less friendly” workplaces than LGBT
men;
 76% of LGBT women vs.85% of all others reported that their manager was comfortable interacting with them.
 70% of LGBT women reported that their manager evaluated performance fairly vs. 80% of LGBT men
and 77% of non-LGBT women and men.
 On average, LGBT women are “out” to 50% of their workgroup versus LGBT men out to 72% of their workgroup.
• “Out” employees in safe environments earn 50% more and contribute more to the business
than closeted employees in hostile environments

9. © 2005 IBM Corporation
The Individual Cost of Thinking Twice:
The workplace is not a place for your personal life… Or is it?
 Have you ever heard, stated or asked…
“…how was your weekend, vacation, holiday?”
“…how is/are your wife, husband, spouse, children, grandchildren?”
“…congratulations on your engagement, marriage, birth of your child, adoption of a child,
community service award, anniversary etc.”
“…is your spouse, child, sibling, parent feeling better from his/her cold, skiing accident,
other illness, etc.?”
“…I am deeply sorry about your divorce, loss of a parent, in-law, spouse, sibling, child,
grandchild…”
“…you are invited to my child’s confirmation, bar mitzvah/bat mitzvah, graduation,
wedding, ball game…”
“…my family went to our summer cottage for the weekend.”
If so, then the workplace is an appropriate place for employees to discuss their
personal lives… but at what cost to LGBT employees?
The “Invisible Minority” must make choices every day…

10. © 2005 IBM Corporation
“Coming Out”: Takes courage & is not a one-time event
41%
27%
5%
1%
23%
3%
0
50
100
150
Responses
Very comfortable
Slightly comfortable
Undecided
Slightly uncomfortable
Very uncomfortable
No Answer
Comfort with communicating LGBT status
Those “out” at work:
Risk disapproval, violence, discrimination and career derailment.
Can strengthen relationships with co-workers and colleagues as an authentic person
By sharing personal lives and social activities with colleagues, LGBT employees can:
Develop more effective personal connections
Be seen as courageous and trustworthy by professional connections
Are more aligned with the goals of, and more loyal to their organizations
Tend to access their entire skill set for the organization (innovation, creativity)
Are more productive in the workplace, because they do not spend energy hiding

11. © 2005 IBM Corporation
Remaining in the Closet: has both personal and team impacts
30%
20% 19%
12% 11%
8%
0
50
100
150
Responses
Avoid discussing personal life
Refrain from placing partner's photo on desk
Remain silent when others make offensive GLBT comments
Change pronouns when discussing personal life
Avoid, on personal time, areas frequented by other IBMers
Lie about my personal life
In addition, those not out at work:
Constantly and carefully examine each of their thoughts and actions – all day, every day
Tend to be very isolated at work:
Distance themselves from both straight colleagues to avoid personal conversations
Distance themselves from LGBT colleagues to avoid “guilt by association”
Are often seen by peers & supervisors as not authentic or honest people, because they are not
forthcoming about their personal lives.
Compromise their image as trustworthy when people eventually find out they are gay
May see safety, job retention or career advancement an issue

12. © 2005 IBM Corporation
IBM employee, Peter and his life partner, Andy celebrated 10 years together on
Saturday. Peter gave Andy tickets to the Broadway show he’d wanted to see for years
Can you believe it's been 10 years? Open it!
Wow Broadway tickets!
When are we going?
Tonight, we have a 3:00 flight to New
York and 5th row seats for the 8 o'clock
show!
What really happened this weekend:
Lost Productivity l Reduced Teaming l Decreased Employee Morale
“What did you do this
weekend Peter?”
Have I
opened up to this
person?
"Not much, I saw a
play with a friend."
Share excellent
adventure
Start work feeling
energized and part of the
team
Have they
“got it” yet?
No
Is this
Henry?
No
Is this
Martha?
No
Is this
Pat?
No
Is this
Colleague A?
Is this
Colleague Z?Is this
Colleague A?
Knows I have a partner but for some
reason thinks he's my business partner.
Has heard me refer to my partner, but
still calls him my roommate.
What colleague Z knows and what I think
she thinks.
What colleague A knows and what I think
he thinks is the case.
Lapsed Time: 6 min.
Morale: High
Try to make progress. Be evasive or shut down
depending on energy level and the colleague.
Start work feeling drained, down about lying,
appearing evasive/unfriendly/not part of the team.
Lapsed Time: An
eternity!
Morale: Rock Bottom
The cost of the closet
How Peter thought before talking about it back in the office:
Yes
Yes
"No you don't know
her."
"She's just a friend."
"Oh just friend’s local
small town production”
"SO! Let's talk about
your weekend!"
No
No
No
Lapsed Time: 10 min.
Morale: low
Knows I'm with someone, but keeps telling
me he can't wait to meet her.
Yes
Yes
Yes
Yes
Yes
His colleagues will think he is a snob, because
he never shares any personal things. He will
avoid spending informal time with the
colleagues, be cut off from information,…

13. © 2005 IBM Corporation
Diversity improves decision making:
Irving Janis “Groupthink”
8 symptoms characterized into 3 groups of issues:
• Overestimations of the group—its power and morality
• Closed-mindedness
• Pressures toward uniformity
With the board members lacking expertise in the field and having somewhat similar background,
norms, and values, the pressure to conform became more prominent. Together, these conditions
may have contributed to the poor decision-making process that eventually led to Swissair’s collapse.
Hermann, A., & Rammal, H. G. (2010).
The grounding of the "flying bank". Management Decision, 48(7), 1051.
This paper considers two recent cases of possible groupthink in British corporate management at BA and
Marks & Spencer. During the 1990s both companies released globalization expansion strategies. This
analysis of media press releases reveals that all eight symptoms of groupthink were present . During 1998
- 1999 the price of Marks & Spencer's shares fell from 590 to less than 300 and that of British Airways from
740 to 300.
Eaton, Jack (2001)
Management Communication: The threat of Groupthink.
Corporate Communication, 6.4, 183 – 192

14. © 2005 IBM Corporation
Diversity improves talent acquisition:
LGBT inclusion in your formal recruiting and on-boarding processes will
signal that talent is valued in your company
Diversity improves business culture:
LGBT diversity is the hardest one for corporations:
A high-performance culture of integrity, trust & openness is enhanced
when all employees can be their authentic selves at work
Diversity improves Innovation:
The best ideas for leadership and innovation tend to come from both
having and accessing diversity:
The Medici Effect by Frans Johansson
Open Innovation by Henry Chesbrough
The Difference by Scott E. Page
Putting our Differences to Work by Debbe Kennedy
The Opposable Mind by Roger Martin
The Paradoxes of Diversity in Innovation by Susanne Justesen
The 5 Disciplines of Innovation by Carlson & Wilmot
Weird Ideas that Work by Robert I. Sutton
Tempered Radicals by Debra Meyerson
The Big Sort by Bill Bishop

15. © 2005 IBM Corporation
What you measure matters:
Benchmarking on the Maturity Curve for LGBT Diversity
Level One Level Two Level Three Level Four
Safety for ALL
LGBT Employees
Equality of Benefits for
all LGBT Employees
LGBT Employee
Leadership Development
“Out” employees at
senior exec. level
Global Non-
Discrimination
Policies – framing
the dialog as
Human Rights
Corporate sponsorship
of LGBT NGO initiatives
and programs
Monitoring & changing
discriminatory country-
based internal corporate
practices
Advocacy to change
discriminatory laws in
countries where the
corporation does
business
Mandatory Diversity
Training for
everyone
Workplace Climate
surveys include LGBT
questions
LGBT Supplier Diversity
program
LGBT Diversity
Metrics including # of
“out” executives &
advancement profiles
Senior Executive
Sponsorship of
LGBT Taskforce
Ally Programs and
Reverse mentoring for
“Straight Allies”
Country-level executives
held accountable for
diversity programs
LGBT Diversity
incorporated into
manager & executive
candidate slates
HR focus, and
LGBT Employee
Resource Groups
Intentional LGBT
Recruitment and
Retention Focus
Marketplace Focus, and
Leverage of diversity for
Innovation
Accountability for
diversity at all levels
of management

16. © 2005 IBM Corporation
“They always say time changes things,
but you actually have to change them yourself.”
Andy Warhol (1928 - 1987)

17. © 2005 IBM Corporation
The Cost
of
Thinking Twice
Claudia Brind-Woody
IBM Vice President & Managing Director
Intellectual Property Licensing