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The impact of diversity on the global economy

A more diverse company makes more money, explains Henri Eliot. But, that's not the only reason a company should be diverse.

According to professional services firm EY, the impact of women on the global economy over the next decade will be equivalent to that of China and India combined. 

A recent KPMG survey found companies with females on their boards have achieved higher revenue growth, profitability and shareholder returns than those without. It’s important for boards to understand how to leverage and support this opportunity. 

The advancement of technologies such as smartphones, collaboration using cloud computing tools and artificial intelligence are making flexible workforce mobility possible.  A reality versus a ‘nice thing to have’.  Delivering results versus perceived physical presence myth needs to be shattered!

According to Diversity Works NZ, new research has revealed that 20 percent of businesses have less than 25 percent female representation at governance and leadership/decision-making levels.

The latest Diversity Survey has also revealed that “more than half of New Zealand employers value the experience of their workers over the age of 55 and workplace wellbeing is still the number one diversity issue in our organisations”.

According to the survey, employers are “missing the opportunity to engage with older workers, with more than 70 percent of businesses having no specific strategies to manage employees over 55”.

The survey also shows that “diversity is becoming a bigger consideration for smaller businesses, but many organisations are vulnerable around workplace bullying, with almost half having no policy in place to deal with this important issue”.

But flexible working leads to a range of different outcomes. Polycom’s New Global Survey into the Future of Work research shows almost two thirds (62 percent) of the global workforce can take advantage of flexible working practices. The research showed Australia is one of the most flexible countries, with 90 percent of companies offering flexible work.  New Zealand is probably not much further behind this number but was not part of the survey.

However, it states that 59 percent of Aussies worry that working anywhere might lead to longer hours and 34 percent believe they might be overlooked for a promotion if they work remotely.

According to the Polycom survey, “employee demographics are also facilitating the advancement of flexible working. Employee demographic comprises an individual’s census characteristics, alongside their employment stage, drivers and goals. Examples include millennials, wellbeing warriors, working parents and baby boomers. Each stage shakes up the way they work and shapes their technology requirements and expectations to get the job done and meet KPIs”. 

“Flexible working is also making it easier for parents to return to work sooner after having children. In an era of ageing populations, it not only allows for improved co-parenting, but also for working family members to look after elderly parents or go to other activities to achieve work-life balance”. 

“Today, flexible working has evolved to include the concept of ‘anywhere, anytime working’. It’s about making your working hours as productive as possible, no matter your location of choice – a boardroom, huddle room, local café or airport”.

The Polycom survey also states that “it’s time for the flexible working conversation to extend beyond managing the needs of parents returning to work. It is time to consider flexible working equity for all, regardless of gender, family commitments or career stage”.

It concludes that “Modern workplaces need to empower both men and women to embrace a work anywhere ethos, especially at senior levels of management. When you achieve a workplace culture where it is considered business as usual for employees to balance work with family, further studies, hobbies and other ambitions, it changes the dynamic of work and retention rates for all employees, regardless of gender”. 

Logic dictates that boards should lead the way through management in improving diversity in their companies. Challenge the Status Quo. Diversity of thought includes a combination of varied business/life experiences, gender, age and ethnic diversity.  This ultimately leads to “creative tension” and “diversity of thinking” which provides numerous benefits to society and the company’s financial performance. Shareholders can’t argue with that point.

Henri Eliot is founder and CEO of Board Dynamics.