Diversity isn’t just the good thing to do; it’s the smart thing to do. Diverse teams lead to more productive conversations and better decisions. But how do boards become diverse? Peter Murphy, General Manager, Queensland Davidson Boards & Executive gives his tips for acknowledging bias, embracing diversity and recruiting for stronger boards.
Diversity is the art of thinking independently together
The only way you can achieve true diversity of opinion on boards is if you really embrace it and, importantly, only if you actually want it.
When broaching this subject with boards looking to recruit new talent, the first question I always ask clients is: do you want diversity for the right reasons or is it a ‘tick the box’ exercise?
Usually any conversation on diversity automatically defaults to gender, however in reality it should be much broader and deeper. Diversity covers age, ethnicity, philosophies, life experiences, personalities, backgrounds and competencies, just to name a few.
To achieve diversity it requires us to truly challenge ourselves. To drive change that makes an impact we must question our norms and remove our own unconscious bias and navigate towards what makes us uncomfortable.
Dr Yilmaz Arguden, a Global Leader for Tomorrow at the World Economic Forum, recently said that a well-functioning board of directors needs diversity of experience and perspectives.
“If everybody thinks the same, then there is no need for a board; one individual would suffice,” Dr Arguden said.
“Diversity for its own sake, however, is not an improvement in governance; what matters is the combination of complementary skills and experiences that members bring to the table to better address the challenges the company is likely to face.”
So why should we have diverse thinking boards?
- Diverse boards offer a myriad of opinions. They listen to their executives while challenging when appropriate. They ask questions.
- Progressive, contemporary boards embrace feeling uncomfortable around each other, because they accept the benefits that flow from having healthy, robust discussions before reaching agreements on a course of action.
- Diverse organisations are better positioned to adapt to an ever-changing global environment. Boards should reflect the diverse world in which they operate.
Here is some advice for boards looking to make diversity a priority at the recruitment stage:
1. Don’t seek mirror images
It’s natural to be drawn to candidates that are similar to ourselves and what we know. They may seek candidates who have similar backgrounds, as they feel they will get the most value from this. However, it is important to be conscious of this and to source new board members who compliment what already exists, rather than replicate it. These candidates will test the conventional thinking in the boardroom, allowing bold decisions to be made and for those that make them to thrive. Failing to see the value of a diverse board is a myopic and small-minded view, which will only stifle growth.
2. Processes are your safety net
Boards should establish a clear process when recruiting for new talent and any barriers for diversity should be identified and adjusted before official recruitment begins. You may have a desire for new thinking and a commitment to change, yet if you have poor processes you will fail. Consider the channels by which you will promote the role, and the interview process as a whole. Are you actively seeking to recruit diverse candidates? Provide equal opportunity for all candidates and ensure that your selection procedures are efficient and effective.
3. Recruit outside of your comfort zone
Don’t be constrained by what your own networks have to offer. Today’s directors are well connected – they have to be – but it can sometimes be detrimental, particularly for the diversity of the group, to only look to who you know. Seek candidates from places you would not normally look and step outside of your experiences.
4. Recruiting based on potential is not a bad thing
It is probably safe to say that someone noticed potential in you and provided you your first opportunity to become a director, so why not offer the same to someone else? Hiring someone with potential means that there is room for them to grow into the position and the likelihood of them bringing a fresh perspective to boardroom discussions and decision-making is high – and that is what diversity is all about.
The drive for change is often due to external forces, be it institutional shareholders, the media, regulators or others, yet for change to occur properly and effectively it has to come from within otherwise it is merely a ‘tick the box’ exercise with no substance behind it.
So be brave and accept diversity, you might surprise yourself what you learn and how your board will thrive from your bold decision.
Peter Murphy is the Queensland General Manager for Davidson Executive and Boards. Peter is one of Australia’s leading recruiters in the finance and C-Suite industry. Peter was the former Queensland Chairman of the Institute of Chartered Accountants in Australia and New Zealand.
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