Diversity is not tokenism
There is much being written about the age of rapid technological, social, and environmental change, where there is an ever-growing importance to have a diverse team, with the ability to respond and react to threats and challenges quickly to survive. The importance of diversity is equally, if not more important when you get to the boardroom. While most of the current emphasis is on the Boardroom, Former REINZ Chair, Dame Rosanne Meo stresses this is equally important in executive and leadership teams throughout our organisations.
In the real estate profession in New Zealand, there is a high proportion of women, but it’s not always reflected in the executive ranks. But, adds Meo, “This does not make real estate particularly distinctive from many other business communities, such as law, finance or even the service sector, for instance retail and advertising.”
Diversity is not about choosing someone, solely to tick a box and show that you have filled the required quota. It is about ensuring you have equal opportunities, and people of mixed ages, genders, cultures, sexual orientations and abilities on the board and choosing someone because they genuinely fulfill the requirements for skill and experience.
“The key to diversity is diversity of thinking in your leadership roles, not tokenism. You want your leadership to reflect your customers as well as your employees,” stresses Meo.
A diverse board and executive team encourage a diverse working culture and cultivates a workplace with the ability to appeal to staff and customers, and keep them – particularly as the New Zealand population becomes more socially aware.
Diverse backgrounds are the foundation for generating fresh ideas and bringing a variety of perspectives when confronted with negative issues. It ensures that decisions are not made without thinking about the implications from a variety of kickbacks, or that only one world-view is considered when making decisions. The board that serves a company or organisation should reflect the diversity of the people it represents in all ways.
There are further benefits to companies having diversity in the workplace, with the Institute of Directors’ Chief Executive Kirsten Patterson saying, “Companies that prioritise diversity in their leadership are 45% more likely to grow market share and improve shareholder value, compared to publicly traded companies lacking diversity. They’re also 70% more likely to capture new markets.”
It once used to be common sense to have a board of like-minded directors that could easily agree on a solution. However, the realisation has occurred that the best ideas are generated when the status-quo is challenged, and different view-points are discussed. That is not to say that a board should be made-up of clashing personalities and difficult people, cohesion is still important - but directors should feel comfortable bringing up alternative ideas that they know will be discussed and challenged until an ultimate solution has been found.
Boards, directors, and senior leadership teams must evolve to maintain the ability to meet the challenges of an ever-changing world and workplace. The solution to a lot of these issues is that younger directors are needed, from a wider variety of backgrounds (with industry experience) and the ability to adapt to new business culture and the time needed to commit to the heavy workload.
The difficult part of transitioning to a fully diverse board is the change-over period, as increasing diversity is not to dis-count the traditionally older white male candidates that currently hold positions on boards or senior leadership teams. It is understandable that after decades of a power imbalance in favour of one type of candidate, that equality may feel unfair to those previously favoured. However, if the incoming candidates are of equal or higher suitability, then why should they not stand an equal chance. It is not an exclusion of those currently sitting on boards and in leadership positions, but is a cry for fairer representation, one that accurately reflects the population. There is a responsibility placed on the people who recruit and appoint positions on boards and senior teams, to ensure they are doing their due diligence and considering diversity, as they are the ones most likely to be able to facilitate the change.