Why diversity matters

by 21 Aug 2007

History is littered with examples of pioneering women who have exercised leadership at times when societies excluded them from exerting their influence within the prevailing power structures.

But how far have we really come in harnessing that spirit and giving it a voice in our contemporary society’s power structures?

Judging by statistics released in last year’s Australian Census of Women in Leadership, we still have some way to go. The statistics show that 129 directors’ seats out of 1,487 are filled by women, while 50 per cent of ASX200 companies have at least one woman board director, almost unchanged from two years ago. The number of female chief executives has not increased since 2003, with just six companies of the top 200 led by women.

What’s more, when the Forbes magazine published its 100 most powerful women’s list late last year, there were no Australians on the list.

These statistics do not paint a pretty picture for Australian women aspiring to leadership roles and they raise questions about gender representation specifically and diversity more generally.

As a nation where resources are increasingly scarce and with an ageing population, we need to find ways to ensure the participation of all members of our society if our much-loved, long-lived economic prosperity is to continue.

Why has the glass ceiling been so hard to break through in Australia compared to other Western democracies?

It just isn’t realistic to suggest that things can stay this way – with such an under-representation of women in leadership roles - at a time of record low unemployment, increasingly tight labour markets and growing skill shortages.

Of course, gender representation is only one aspect of diversity.

Charles Darwin observed about the survival of the species, that the race goes not to the strongest or the smartest, “but the ones most adaptable to change.”

Like the survival of the species, it is also widely acknowledged that the companies that succeed are the ones that can learn and adapt the fastest.

Companies that reflect the populations they serve, that value collaboration and that embrace diversity of thought, style and culture are likely to be far more adaptable than those that don’t.

For diversity to flourish, people need to see people like themselves in leadership roles, in the senior management teams, and on the boards of the companies they work for.

Without such role models it is unlikely that women, and other marginalised groups of people, will aspire to positions that can create the kind of diversity we need at a leadership level.

Now, adding to these challenges is the fact that most organisations have up to four generations represented in their workforce.

In her study of leadership and generational diversity, Avril Henry found that each generation has its own values and views of career, learning and development, family, sense of loyalty, and expectations of leaders and the work environment.

For example, her studies into generation Y show that they are looking for inspiring leadership, an environment that respects skills, creativity and entrepreneurial flair, access to the most up-to-date technology and training, and a balance of work and life.

Rather than fight the system, this generation of young people simply dismisses it, and if they cannot find the kind of company they want to work for, they build it themselves.

In fact, in Australia in 2004, more than 50,000 small- to medium-sized enterprises were owned and run by generation Y.

Personally, it is very important for me to work in an environment where diversity is valued and promoted.

Our CEO at Telstra, Sol Trujillo, is committed to diversity. There was only one woman on Telstra’s senior leadership team before Sol arrived, and he’s since appointed three other women, including me.

We recognise that promoting diversity will become even more important as we see the impacts of the ageing population and like every other modern company compete for scarce labour resources.

Companies need people from different backgrounds, different genders, different generations and people with different life experiences. This kind of diversity brings creativity, innovation, and fresh thinking.

While it is a real temptation to surround yourself with people just like you – because it’s safe and comfortable – it actually doesn’t create a strong foundation for the future.

It’s important to remember that diversity matters not just for its own sake but because the continued success of our businesses depends on it.

By Kate McKenzie, group managing director, Telstra Wholesale