The Importance of a Diverse Leadership Team

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Building a diverse workplace starts at the top with a diverse leadership team.

Yes, hiring staff from a range of backgrounds and identities is a great place to start. But if you’re working to make your culture more inclusive (hint: you definitely should be), the first place to look is your leadership team. Because actions speak louder than words – and your employees will always notice who you promote into positions of power.

Let’s talk about why you need a diverse leadership team that represents your diverse workplace.

But first, a disclaimer!

One thing we’re not going to suggest here is that there’s a ‘perfect diversity quota’ you need to achieve for your leadership team, or that you need to start dismissing good people for the sake of diversity. We don’t have a checklist of genders, ethnicities, religions, abilities and sexual orientations for you to tick off. So if that’s what you’re looking for, please move on (and perhaps re-evaluate your approach to this).

Rather, we’re encouraging you to keep an open mind when making decisions about your leadership team. Hire people who can bring new perspectives to your management meetings and relate personally with a wide range of your employees. Remain aware and recognise if/when your top level becomes too homogenous – and then question why that may have happened.

Now let’s get into why having a diverse leadership team is important.

It’s better for business performance​

Diversity In Leadership Teams group of diverse staff

Some studies (including this one by Gallup and this one by McKinsey & Company) have shown that diverse businesses tend to perform better than average. There are a couple of factors that may contribute to this:

  • Diverse leadership teams have a larger pool of experience and unique points of view to draw from, which can help with finding solutions to problems and generating new ideas.

  • Seeing people ‘like me’ in powerful positions can inspire employees to stay longer and strive for promotions themselves (i.e. increasing staff retention and motivation).

  • By having a leadership team that reflects a commitment to diversity, you’ll find it easier to attract great talent because high-performing people will be more eager to work with you.

  • People from different groups and backgrounds often bring unique connections with them, which can lead to more networking opportunities for your company.

If you need a ‘business case’ for building a diverse leadership team, the potential performance boost is your best angle. But from a more people-oriented perspective, you may find the next two reasons more compelling.

It’s better for your staff

Diversity In Leadership Teams group of diverse young staff

Imagine being a female employee and seeing a consistently all-male leadership team. Or being part of an ethnic minority when all the managers are Caucasian. When you don’t have a role model within your company, it’s more difficult to feel motivated or envision a path forward for yourself.

This scenario can also make an employee feel like diversity isn’t really valued by the business’s leaders. Sure, the company has a Diversity and Inclusion Strategy, but does that mean much if it’s not reflected in who the company hires and promotes into senior positions? And what kind of image does it present if a certain category of people are only present in the lower levels of your business’s hierarchy?

You can see why it’s easy to fall into a vicious cycle of only promoting particular people because only those people are inspired to stick around and apply for those promotions.

In contrast, having someone in the leadership team who represents a minority can reinforce to similar employees that:

  • Their presence and contributions are valued

  • Somebody in the management team can relate to them

  • There are opportunities for them to progress in the company

Seeing somebody who shares a crucial part of your identity in a position of power can have a greater impact than you might realise – on staff retention, satisfaction, and productivity.

It’s better for society

Diversity In Leadership Teams group of diverse mature staff

Several groups are under-represented in business. And this is a problem for people and for businesses.

Just look at some of the tone-deaf and downright offensive marketing mishaps that could have been easily avoided by having a more varied group of decision-makers.

By giving senior opportunities to a diverse range of qualified people, you can help open the door for inclusion and representation in other facets of society. Every step towards a diverse leadership team is like a stone in the lake. Those ripples can really reach out.

And who knows? Maybe one day we won’t have female CEOs, gay CEOs, Aboriginal CEOs… we’ll just have CEOs. Because those combinations won’t be so rare that they warrant a special mention.

How can we help?

Chandler Macleod provides a comprehensive suite of tools allowing you to gain accurate people insights, hire with confidence and focus your employee experience to achieve your business goals.

Hiring the right people can significantly enhance productivity and performance and have a positive impact on organisational culture. We’d love to show you how you can use our powerful assessment tools to unleash the potential of your people, teams and organisation. Contact us now.

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