Workplace diversity delivers real business benefits, according to a joint CBI and TUC report.

The Talent not Tokenism report highlights advantages of employing people based on their ability rather than their gender, race or age, for example. It says companies benefit from increased morale and productivity, improved retention and a greater understanding of customers' needs.

The report identifies vital components for a successful diversity programme, including senior management leadership and employee engagement. But it refrains from labelling positive discrimination as a helpful way to achieve diversity.

"Employers who encourage a more diverse workforce notice huge benefits from doing so," says Richard Lambert, director-general of the CBI. "It does not have to be hard work or legally complex either - simply make the effort to work out your precise needs, reach out as widely as you can, then hire, train or promote the best person on merit."