By Andrea Bankier
Diversity means many things to different organisations. Talk to the average firm today about diversity and they’ll more than likely talk to you about the gender diversity (or lack of) on their board. It’s timely that 125 years ago, we were the first country to give women the vote, and it’s still a topic that is hotly debated. Whilst there has been a tremendous amount of media coverage and thought put into this, the actual notion of diversity is far deeper than just gender.
Diversity can encompass ethnicity, disability, religion, sexual orientation, thought diversity, and of course generational. According to the Sheffield Leadership Survey, generational diversity is a given for the modern workplace whether we like it or not. We spoke to many firms who said that they had (in some cases) up to five generations (Builder, Boomer, Gen-X, Millennial/Gen-Y, and Gen-Z) working in the same workplace.
Different types of diversity means taking a new approach to how we recruit and develop staff. But why are we being diverse in the first place? Some think that increasing diversity is simply “PC gone mad”. Regardless, you cannot deny that there are some substantial benefits to having a diverse workplace.
According to HBR, a report on 366 public companies found that those in the top quartile for ethnic and racial diversity in management were 35% more likely to have financial returns above their industry mean. Furthermore, those in the top quartile for gender diversity were 15% more likely to have returns above the industry mean. If that’s not enough, a global analysis of 2,400 companies with at least one female board member yielded higher return on equity and higher net income growth than those that did not have any women on the board.
In another study, researchers concluded that increased cultural diversity is directly proportionate to higher levels of innovation. Of the 7,615 firms that participated in the London Annual Business Survey, results revealed that businesses run by culturally diverse leadership teams were more likely to develop new products than those with homogenous leadership.
The challenge we must overcome is that most of us feel more at ease working with people who share our backgrounds. Hiring individuals who do not look, talk, or think like us, for many can be a challenge and a roadblock. This has to change! The scientific evidence shows that it is increasingly important to do so, lest we discourage innovative thinking.
Finally, if you needed another reason to improve diversity, research shows that a more diverse workplace leads to increased levels of EQ. So for the sake of innovation, culture and ultimately financial return, consider how you can make your workplace more diverse. And remember that diversity is more than just gender. Diverse workplaces lead to diversity of thought, which is beneficial for everyone.