According to the Pew Research Center survey, 56% of employed adults in the United States view the emphasis on enhancing workplace diversity, equity, and inclusion (DEI) positively.

Diversity, equity, and inclusion have become central themes in the modern workplace. The need for inclusive leadership, which fosters respect for human diversity across various dimensions, has never been more critical. Employees increasingly demand that leaders embrace DEI concepts and implement them in their daily actions.

For emerging leaders, however, this shift presents a unique set of challenges. This blog explores the intricacies of the third-wave DEI movement and sheds light on emerging leaders’ challenges and real-world hurdles as they navigate their expanding responsibilities. It also provides insights into strategies for cultivating a leadership environment that is both inclusive and supportive.

The Third Wave DEI

The first wave of DEI was characterized by a slow, steady progress in corporate America in the late aughts and decade that followed. The second wave, which followed the events of May 2020, saw an acceleration in DEI efforts, with organizations making substantial commitments, such as hiring Chief Diversity Officers and Chief Inclusion Officers. However, over the last 6 to 9 months, a trend has been witnessed where some organizations started downsizing their DEI budgets and reducing their focus on DEI efforts. This transition signifies the commencement of the third wave, a pivotal moment in advancing diversity, equity, and inclusion.

Key Customer Service Skills

The shift in leadership roles and responsibilities characterizes what some experts call the ‘Third Wave of DEI.’ While the name might not be set in stone, there are five brutal realities worth keeping an eye on:

1. Tighter DEI Budgets

  • Organizations are quietly reducing their budgets for DEI initiatives.
  • These cuts aren’t publicized and often happen when lower-profile roles replace positions like Chief Diversity Officers.

2. Expanded DEI Scope/Mandate

  • DEI leaders are being tasked with broader responsibilities.
  • They’re expected to bring impactful business outcomes but with fewer resources.

3. Tension Between DEI Constituents

  • There’s growing tension among different DEI constituents.
  • As resources are spread thin across various groups and initiatives, individuals feel their specific needs and priorities might be overlooked.

4. DEI Burnout

  • DEI professionals and organizations alike are experiencing signs of burnout.
  • The feeling that they’ve “done enough” and nothing is left to tackle can be demoralizing.

5. DEI Detractors Gain Ground

  • Some are beginning to question the value of DEI efforts.
  • This skepticism arises when leaders can’t demonstrate concrete, measurable business benefits from inclusive approaches.

In the world of DEI, these challenges are indeed very real. However, they also present opportunities for reflection, adaptation, and innovation in our pursuit of a more diverse and equitable world. Addressing these issues head-on and showcasing the tangible business impact of DEI initiatives will be crucial as we navigate this third wave and strive for a more inclusive future.

The positive news is that genuine inclusion is increasingly seen as a crucial aspect of business success. Many organizations set an example by prioritizing inclusivity and making it a significant part of their message and approach.

We hosted a webinar in collaboration with entitled ‘Are You Ready for the Third Wave DEI?’ During this webinar, Dan Rust, the Head of Global Leadership and Organizational Development, explored the Third Wave of DEI. A recording of the webinar is available here.

The Essence of Inclusive Leadership

As per the Harvard Business Review findings, leaders play a pivotal role in nurturing inclusiveness in their organizations. They are responsible for a substantial variation of up to 70 percentage points in how employees perceive their sense of belonging and psychological safety. Furthermore, leaders who give precedence to inclusivity observe a 17% increase in team performance, a 20% elevation in the quality of decision-making, and a 29% enhancement in team collaboration.

While many organizations excel in launching inclusive programs and initiatives, the real litmus test is whether leaders at all levels embrace inclusion in their day-to-day actions. For many, embracing inclusion as a concept and integrating it into the hiring process is easy, but practically implementing it in their daily routines remains challenging. True inclusive leadership goes beyond rhetoric; leaders must live and breathe these principles in their interactions and decision-making.


Inclusive leadership is pivotal to successful DEI initiatives in the modern workplace. As organizations navigate the third wave of DEI, it is crucial to ensure that commitments to diversity, equity, and inclusion are balanced and that leadership at all levels continues to embody these principles. Furthermore, organizations must provide adequate support to emerging leaders, clarifying their roles and offering ongoing coaching and mentoring. Organizations can cultivate a more diverse, fair, and welcoming work environment by tackling these challenges and promoting inclusive leadership, leading to advantages for both their employees and the organization.

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