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Why diversity matters to your
Organisations are increasingly recognising the tangible benefits of workplace diversity,
as Nareen Young highlights, but there’s still more to do.
Attracting and retaining talent is a critical
issue for businesses across the globe.
Traditional responses to workforce planning
and development are shifting rapidly in
response to an ageing workforce, competitive
global labour market and skill shortages.
Organisations are also increasingly finding
that the capabilities required to respond to
fast-changing technologies and emerging
markets are not reflected in their talent
pipeline. Harnessing diverse talent in all its
forms is going to be essential to generate the
innovation and performance needed to meet
these challenges.
Organisations are
increasingly understanding
the need for their
workforce to reflect their
customer base.
Organisations are also facing greater
requirements for transparency by reporting
progress on diversity, from regulators such
as the Australian Securities Exchange or the
Workplace Gender Equality Agency, but
also in relation to government tenders, and
from increasingly discerning employees
and customers.
Smart organisations are already seeing the
benefits that flow from effective management
of workplace diversity. Both industry
experience and research indicate that
workplace diversity and inclusion are clearly
linked to improvements in organisational
performance, effectiveness, profitability and
revenue generation. Leading practice diversity
organisations continue to see the evidence
that effective diversity management leads to
significant business benefits. For example:
• global businesses ranked in the top quartile
of executive board diversity received a
return on equity that averages 53 per cent
higher than businesses in the bottom
quartile (McKinsey 2012)
• Fortune 500 companies with the highest
representation of women board directors
attained significantly higher financial
performance, on average, than those with
the lowest representations of women board
directors (Catalyst 2007)
• a survey of Australian employers found
that best practice organisations reported
significant business benefits of work-life
initiatives including a reduction in staff
turnover of 15 per cent, a reduction in staff
absenteeism of 16 per cent, a positive
impact on productivity and an increase in
the parental leave return rate of 40 per cent
(Managing Work-Life Balance
Survey 2007).
Business progress on diversity
Gender diversity is currently the focus of a
lot of energy and attention in corporate
Australia. The main impetus has been the
introduction in 2010 by the ASX Corporate
Governance Council of a requirement that
listed companies adopt and disclose a
diversity policy that includes measurable
objectives relating to gender. The
introduction of the new Workplace Gender
Equality Act 2012 last December has also
sharpened the focus on gender, as all private
sector employers with 100 or more staff
grapple with changed reporting requirements.
With the Australian Bureau of Statistics
showing a persistent pay gap between men
and women – currently 21 per cent (Nov.
2012) – and women comprising less than
11 per cent of directors on ASX 200 Boards,
this attention continues to be warranted.
Progress on key equality indicators such as
the pay gap and women in leadership has
virtually stalled. Women still face significant
barriers to their inclusion in employment
because of discrimination and particularly as
a consequence of the way employment often
fails to support women’s responsibilities
for family care.
However, flexible working and careers are not
only important for women, but for a range of
employees. People caring for small children,
elderly parents or family members with a
disability; employees facing an illness or
managing a disability; mature-age workers
and workers involved as community
volunteers may all need flexibility at work.
The Get Flexible! research conducted by
Diversity Council Australia (DCA)
() has found
that greater efforts need to be made by
employers to mainstream flexible working so
that it is the norm, rather than the exception.
Building relationships with Aboriginal and
Torres Strait Islander communities has been a
focus for corporate Australia. It has, however,
not yet translated into significant or
sustainable employment outcomes for
Indigenous people in this sector. We are
conducting research called Closing the
Work Gap in Corporate Australia in
partnership with Reconciliation Australia and
Lend Lease that shines a light on how
corporates can put in place more effective
engagement strategies.
Organisations are increasingly understanding
the need for their workforce to reflect their
customer base, recognising that there’s much
to be gained in terms of reputation,
recruitment, retention, productivity and
market share. Ensuring your workplace is
welcoming and inclusive of lesbian, gay,
bi-sexual and transgender (LGBT)
employees, clients and customers is
important to many businesses. In partnership
with ACON and Stonewall UK, DCA has
established the Pride in Diversity program
(). It is the
first Australian not-for-profit employer
support program to focus exclusively on
supporting Australian employers with every
aspect of LGBT inclusion.
In contrast to progress in these areas, cultural
diversity is less well understood by business
– apart from a progressive minority of
organisations who are well advanced in their
diversity strategies. There seems to be a lack
of understanding of the business case for
cultural diversity. And many organisations
fail to make the link between the cultural
diversity of their staff and broader business
goals such as accessing new markets, building
customer relationships and innovation. The
rising economic power of Asia is making the
20 accounting technician April 2013