The Blindspot of ESG-Led Diversity: America’s Veterans

The rise of Environmental, Social and Governance (ESG) initiatives is a potent force across virtually all sectors, and many focus on the 'diversity' subset of DEI. Unfortunately, veterans are largely missing from these targeted programs.

Danny Francisco is a WWII veteran who flew 50 successful missions over Europe as a tail-gunner in a B-17 warplane. Eric Ward/Unsplash

As major corporations champion efforts in Diversity, Equity and Inclusion (DEI), America’s veterans are often excluded from the national conversation. Sure, these individuals have voluntarily chosen to join a minority group, but that doesn’t mean the mental and physical tolls veterans endure are less traumatic than those suffered by other marginalized groups. Veterans are 57 percent more likely to commit suicide than those who have not served. They give years—decades, even—of their lives to a greater cause, yet many are offered little consideration for the challenges they face as they transition out of military service.

Assuming veterans find employment post-service, they are rarely offered the resources or opportunities touted in the name of DEI. A staggering 69 percent of veterans cite finding a job as their biggest challenge once they leave the structure and discipline of military service. This should be unsurprising.

America’s active duty volunteers represent less than 1 percent of all U.S. adults, a fraction compared to involvement a generation ago. In 1980, retired and active veterans represented 18 percent of the population. Today, they represent less than 10 percent. Veterans are one of the most diverse groups and should be considered a population, a culture and a subculture, enhancing socioeconomic, racial and gender diversity. With two million service members expected to leave the military for the private sector this decade, the need for DEI efforts in the name of veterans is greater than ever.

“I felt lost,” 32-year-old Chris Stanley told Observer. Before joining the Department of Energy under the Veteran’s Preference for Federal Hiring, Stanley was an avionic mechanic in the Army. As he tells it, every job interview focused on the responsibilities and was measured in pay—not impact. 

Transitioning service members like Stanley are hindered by the uniquely challenging position of articulating their valuable transferrable skills to often rigid job descriptions and criteria. Because of this, the average initial job search takes more than six months and includes frequent early job switching, given the struggle to blend an identity with a job. The rise of Environmental, Social and Governance (ESG) initiatives is a potent force across virtually all sectors, and many focus on the ‘diversity’ subset of DEI. Unfortunately, veterans are largely missing from these targeted programs. An estimated 80 percent of civilian organizations lack veteran-specific recruiting programs, and less than 40 percent offer onboarding or transition support. Institutional investors express broad eagerness to support and invest in ESG and minorities, yet with DEI and ESG omitting veterans in reporting and inclusion, they still remain overlooked.  

“We were taught to tough it out,” veteran and Okta team leader Patrick Ainsworth told Observer. Veterans often under-index for the demonstrable characteristic of personal advocacy—call it the squeaky wheel of stringent persuasion—which may inadvertently diminish their visibility and broader standing among more vocal DEI-championed efforts.

The current focus on improving DEI programs provides the perfect foundation for growing ESG initiatives to widen their reach to include veterans. There needs to be a national dialogue on the absence of veterans from current diversity-related conversations. DEI and ESG reports need to represent all minority groups transparently and consistently. With a recent survey from CNBC found that GenZlaces a particular interest in a commitment to equity, putting this initiative into practice is a natural next step. 

The transformation needed across industries begins with transparency. Of Fortune’s 2022 ranking of the top 10 Diversity & Inclusion (D&I) companies in the Fortune 500, only three publish veteran statistics in ESG, DEI/D&I or Corporate Responsibility reports (and one is in their first year of disclosure). Just five have committed to hiring more veterans and only three have reported donations to veteran organizations. The term “veteran” is missing altogether from one company’s corporate filings. As is evident, traditional DEI methodologies overlook and underappreciate veterans, inviting more scrutiny and cynicism about ESG metrics. 

In contrast, Future Union’s inaugural ranking report grades the top 25 employers for veterans, based on a quantitative methodology and replicable framework. Out of more than 1,000 companies reviewed, only a fraction of the publicly available information had a separate, comprehensive breakout of veteran statistics. On the other hand, the best veterans’ programs have shown that companies can boost visibility and engagement through employee-resource groups (ERGs), which often act as affinity groups and offer an informal conduit for group-specific issues—creating new mentorship and leadership opportunities and increasing awareness, support and advocacy for rising stars.

Standout companies like Verizon and JPMorgan Chase (JPM) have shown that actively embracing veterans’ skills can enhance the bottom line ith more engaged, loyal employees. Research proves that we strengthen our institutions, companies and government with greater diversity in viewpoints, races, cultures, experiences and thoughts. This is not merely hopeful rhetoric; success is already demonstrated. Starbucks has excelled in elevating and supporting veterans through new recruiting conduits, transition training, onboarding and mentoring. After committing to 10,000 veteran hires in 2013, Starbucks hired 30,000 veterans and spouses. Nonprofits like HireBridge and publicly sponsored conduits like DoDSkillbridge aid veterans and their spouses as they search for and transition into new roles.

Since real change comes with repetition and continuity, emphasizing veterans in existing DEI conversations is a start. Companies can institute key best practices for hiring and mentoring to retain, upskill, and grow this marginalized group.

Future Union is advocating for the transparency of details, including veterans as a percentage of total employees; direct veteran benefits; funding to veteran groups as a percentage of total funding in DEI; and whether such funding originates with the corporate parent or the nonprofit foundation. The existence of such beneficial programs and admirable action should not continue to remain shielded from public view, which is the overwhelming reality. Such data should be publicly disclosed in a standardized format to facilitate transparent tracking and assessment for audiences ranging from other veterans to investors. To that end, Future Union will continue to rank and hold companies accountable for their work on behalf of veterans. Like all inclusion initiatives, change comes with transparency, detailing funding activities, benefit programs and outcome metrics, and that action needs to occur with greater urgency and go further.

Andrew King is the executive director of @FutureUnion, an advocacy and trade association supporting veterans and focused on democratic capitalism, and an early-stage venture capital investor @BastilleVentures, investing in geopolitical democracy while supporting veterans. Previously, he was the general counsel of the Dallas Stars NHL team, a venture capital lawyer, and a hedge fund investor and investment banker.

The Blindspot of ESG-Led Diversity: America’s Veterans