Empowering diversity on your Board (and Executive)

Diversity, Equity and Inclusion (DEI) have been words ever present when talking about organisational culture and workforce, particularly in the last year. In Australian organisations, initiatives for DEI aim to guarantee representation and inclusive treatment of diverse workforces. These efforts strive against discrimination linked to race, gender, age, sexuality, and other minorities. Australian companies are increasingly embedding DEI into their operational frameworks by adopting detailed policies, conducting training programs, and collaborating with a variety of community groups. This approach is fostering a more inclusive corporate environment nationwide, but what about for our boards? 
 
Celebrating its tenth year, the Board Diversity Index* stands as the exclusive in-depth analysis of Australian boards. It surveys the top 300 ASX listed companies, focusing on gender, cultural background, age, skills/experience, tenure, and independence. While providing no data in relation to the not-for-profit space, we could assume the findings wouldn’t be too dissimilar. 
 
Though there has been some progress, especially in the number of board positions held by women, in many areas there has been no progress made at all, if not a decline. 
 
The average age of a Board Member is still over 60 with a rapid current wane in directors under 50, there is no data on directors who are disabled, racial diversity remains under 10% with even less representation of First Nations Peoples, and the LGBTQIA+ Community had 4 openly identified directors total. 
 
These findings are staggering. In Australia 42% of people who identify as LGBTQIA+* hide their identity at work and community events, 1 in 5 people in Australia have a disability*, 30.7% of the Australian population were born overseas*. When asking the question of their stakeholders, “Do they see themselves represented within our Board and Executive?”, many organisations simply need to answer no.  
 
Corporate, sector and professional skills are fundamental when it comes to looking at a board’s capabilities and being assured the members reflect a make-up of people with strategic oversight in all required responsibilities. When viewing this through a contemporary governance lens - a diverse range of lived experiences, community engagement and societal perspectives are also, unequivocally, essential. 

Recognising the importance and enrichment of individuals from diverse backgrounds and perspectives is crucial, as is ensuring that underrepresented groups have representation at the decision-making table. As further evidence, studies* indicate that organisations with highly diverse boards tend to perform better than their less diverse peers. 
 
So how do organisations prioritise and support the diversity of their board members? 
 
An intentional, inclusive recruitment and appointment process: 

Recruitment* sets the tone for the culture of an organisation. The alignment of an organsation’s culture to their purpose and values is demonstrated through what is considered priority within the recruitment process. Making sure it includes alternative interview formats and accommodations, relevant language and pronoun usage, and reflects the particular skills and lived experiences relevant to the organisation’s stakeholders. Using a Skills Matrix that centers contemporary governance and ESG pillars also validates, through data not personal indictment, the full gamit of who should be on the board. Inclusive of the right questions, identifying corporate, sector, contemporary and ESG requirements, a Skills Matrix provides a map of the board’s individual skills, gaps and diversity. This supports targeted, capability-led appointment. 

Offer governance training: 

Unconscious bias is a good starting point in recognising where some of the artificial barriers stem from, faced by those prospectively joining a board. Age, race, gender and ability are some examples where individuals can face discrimination, implicity, before the recruitment process even starts. When considering what “a good fit” for the board is, there are a myriad of skills, experiences and perspectives required. How can your board be assured about how they and the whole organisation are meeting their roles and responsibilities, if the capabilities of the individual directors are an echo chamber of skills in similar areas with foundational understanding in others. Governance and corporate understanding can be learnt. Jargon can be simplified. Diversity of lived experience, age, perspective and gender can’t be taught, yet they are the foundations of the communities and workforces each of our organisations serve. Creating a mentoring program between board members and supporting individual governance training through institutes such as GovernWith* or Governance Institute of Australia* are some ways to provide accessibility to a wider range of individuals, in promoting board diversity. This isn’t to say that everyone can or should be a director, it’s to simply highlight the importance of analysing the barriers faced by prospective board members and providing an equitable environment embedded in diversity and inclusion.  
 
Embed diversity and inclusion within the organisation’s purpose, values and culture: 

More than ever stakeholders, whether that be investors, consumers or workforce, are looking at how an organisation at every level, reflect and embody their purpose, values and culture. Corporate integrity is being scrutinised, fairly. We are seeing human-centric, environmentally focused shifts within the priorities of our organisations, which naturally are reshaping the governance roles and responsibilities. Contemporary governance requires contemporary governance leaders. Not just limited to the board members, this includes the executive, subcommittees and management all providing harmonious leadership, setting the cultural tone, from the top. Diversity and inclusion ultimately should create safety and belonging. When recent studies still reflected women were holding under 25% of executive roles and racial diversity holding under 5%, with little to no data again for other minorities*, we know there is still a long way to go in the marginalisation* and inequity facing our communities. Leadership roles need to reflect these voices, they need access to a seat at the table and an inclusive, safe environment that encourages their input and strategic thinking. 
 
Diversity for the sake of diversity will not succeed. When striving for inclusivity and belonging there needs to be cultural safety, ongoing supports and practical accommodations. For these to be recognised, prioritised and held accountable, contemporary governing leaders, especially board members and executives, need to be intentional in their recruitment processes and governance training to ensure the right people are included in their leadership teams and governing bodies. That the right people have a seat at the decision-making table. That diversity and inclusion starts at the top, giving oversight to contemporary governance practice and supporting a safe, inclusive workplace. 

*References and studies attached