Diversity is gaining ground in the corporate world, but not uniformly.
Companies have made progress and invested resources in hiring diverse talent at the entry level. But there is still a lack of diversity in senior leadership positions. As per a Fortune report, just 41 women are serving as a CEO of a Fortune 500 company. That figure broke last year's record, but still only represents 8.2 per cent -- way distant from parity.
In order for HR leaders to recruit, support, and sponsor senior diverse talent, there is a need to move away from the ‘process of elimination mindset’ that many of them have when looking for senior talent. Instead, the HR leaders need to be more constructive and focus on how to scout out great talent and seek out diverse perspectives that bring value to the company, say experts.
Tina Shah Paikeday, Global Head of the Diversity, Equity & Inclusion Practice at Russell Reynolds Associates, says having balanced representation at the top also, directly and indirectly, impacts morale for employees who are motivated by role models who look like them. This also helps position an organisation more favourably to an external audience of prospective talent who are increasingly attentive to diversity.
In an exclusive interaction with People Matters, Shah, who has 25 years of industry experience and ran the Talent Advisory Board, a boutique research and management consulting firm she founded to advise clients on managing a diverse workforce, before joining Russell Reynolds Associates, talks about the benefits of a more diverse leadership team, challenges to achieving diversity in senior leadership and role of HR in advancing diversity and inclusion in leadership.
Here are some excerpts from the interview.
Diversity gap in leadership
It is a fact that the world around us continues to diversify, across gender, generational, racial, ethnic, and multiple other demographic lines. Yet, when we look at leadership teams across the world's leading organisations, despite continued well-meaning efforts, we continue to see the disparity.
For women of colour in Corporate America, they experience a decline large decline from entry-level (17%) to C-suite (4%) representation. The story is also discouraging for men of colour, who make up 17% of entry-level roles, and only 13% of C-suite roles. At a macro level, the effects of Covid have meant we have taken a few steps back, with women being more likely to lose or leave their jobs as a result of burnout, which will likely impact the gender pipeline.
Challenges to achieving diversity in senior leadership
When looking at barriers to diversity, we must take a holistic lens and appreciate that multiple factors are at play.
For example, we know that personal bias creates limitations across the hiring, development, promotion process, which, in turn, has a knock-on effect on pipeline development and succession, now commonly referred to as the 'broken rung'. Personal bias also influences a leader's tendency to support others, with affinity or 'similar to me' bias shaping preferences around who gets mentored or sponsored, both of which are considered important for progression to the top. This can be a particular disadvantage for diverse talent groups who largely lack representation at the top.
If we turn our attention to systems, processes, and practices, we know that job specifications and highly specific criteria can prevent hiring teams from being able to source and assess great talent with relevant skill sets from diverse industries and backgrounds.
For example, having rigid criteria around P&L experience can limit exposure to highly qualified women or people of colour, who are often overlooked for the opportunity to develop this type of critical experience in the first place. Similarly, sourcing candidates from a select set of industries or organisations can prevent equally viable candidates from being seen.
Benefits of a diverse leadership team
The benefits of diversity on leadership teams and beyond have now been well documented.
In summary, greater diversity of thinking limits the tendency for groupthink, which can stifle innovation and creative problem solving - both of which are critical in today's dynamic world.
Also in a global world, missing representation on leadership teams can create barriers in the way of customer, community, and stakeholder connectivity.
If you don't have leaders in your organisation who can effectively represent and connect to the needs of your broader client and community base, then you miss those critical opportunities to design with an accurate understanding of your end-user in mind.
Having balanced representation at the top also, directly and indirectly, impacts morale for your internal employees who are motivated by role models who look like them. This also helps position an organisation more favourably to an external audience of prospective talent who are increasingly attentive to diversity.
Role of HR in advancing diversity & inclusion in leadership
HR can play a critical role in building and maintaining processes for capturing and reporting on diversity data. This approach to data collection fuels transparency, drives accountability, and enables leaders to take action that is informed by data. Maintaining diversity data also enables organisations to track and report on progress against their stated objectives to ensure continued growth in the right direction.
HR can also support audit initiatives designed to go beneath the surface of talent practices to ensure equitable processes and outcomes for all employees.
Finally, in their capacity as trusted business partners, HR can act as vocal ambassadors of diversity during key talent discussions, such as selection, promotion, development decisions to ensure that objectivity is being maintained.
Ways to improve diversity recruitment strategy for leadership roles
Equity needs to truly be at the heart of every recruitment strategy. Ensuring equity as part of executive hiring is one critical step, but we mustn't undermine the importance of succession too, and broader consideration for the start to end talent lifecycle.
Baking in specific equitable practices at every stage can ensure that we are truly scooping the best talent in, nurturing, and developing that talent, to improve representation at the top.
Taking a strategic approach includes identifying gaps in your current recruitment: who are you missing? Which groups are falling off during the process? Where does your 'broken rung' start or end? What perspectives and backgrounds are you missing? Being clear on the what and the why, can then enable organisations to be more selective in the actions they wish to take to rectify and improve their executive hiring.
Equity in the recruitment of senior leaders can include sourcing from affinity groups, creating and conducting inclusive job specifications and assessment, and being thoughtful about onboarding.
How leadership can promote diversity in an organisation
Leaders can drive change with diversity by taking a multipronged approach:
Taking action - understanding the current gaps, setting aspirations to bridge those identified gaps, and working backward from that ideal state to target the specific actions, initiatives, or efforts that will get them closer to those aspirations.
Changing systems/processes that shape or limit diversity - leaders should invest resources and time to conduct appropriate audits across core talent processes (such as attraction, hiring, onboarding, development etc.) and systems of recognition (such as performance, promotions, succession etc.) to determine where a lack of equity, due to the presence of bias, may be limiting opportunities for diversity.
Role modelling/leading by example - at a personal level, leaders can send important messages about the value and commitment to diversity through their own behaviours and actions. The initiatives they choose to champion, the emerging talent they choose to sponsor or mentor, the decisions they make about who gets recognition and promotion, all signal that diversity and inclusion matter, and in turn influences the rest of the organisation.