Ignoring diversity issues is costing businesses, the Chartered Institute of Personnel and Development (CIPD) has said.

But according to the CIPD, it’s not the cost of failing to meet legislation that is pulling at the purse strings but the failure of businesses to reap the benefits of effective diversity management that include:
* tackling skills shortages
* helping organisations retain knowledge and experience
* attracting more customers
* enhancing profits

Badly managed, the CIPD says that diversity can also cause tensions between people and have a negative impact on the business by triggering poor performance and lack of motivation.

The challenge, it says, is to ‘create a culture in which everyone feels valued so they give their best in their jobs.’

Dianah Worman, CIPD diversity adviser said: "In today's competitive markets organisations cannot afford to ignore possible sources of competitive advantage. Fairness and ethical behaviour in relationships with employees, customers and clients are important to maintain corporate standing and reputation.

“It also helps to maintain and increase market share. Employers must seek to understand diversity fully and how it relates to business performance in order to raise their game and compete successfully. Sticking to basic legal requirements won't be enough."

Hilary Wiseman, head of diversity for UK and Europe for HSBC commented: “We believe the world is a rich and diverse place in which cultures and peoples should be treated with respect and from which there is a great deal to learn.”

A new CIPD guide, Managing Diversity: People make the difference at work-but everyone is different,, is available free on the CIPD’s website.