If you are like most corporate entities in Australia, you probably have enough “mature” anglo men on your board. While we are grinding forward on gender diversity on Australian boards (reaching 30% in 2020 in the AICD’s most recent survey), there is still a considerable way to go when it comes to Chair and CEO roles. In fact, according to the most recent data from Conrad Liveris, there are only nine women who are ASX200 CEOs in 2020, compared with the 14 Andrews, and 11 Michaels listed (another reason that you don’t need to hire me).
With all that said, my opinion is that intellectual diversity and inclusion should be expanded further to incorporate a broader mix of cultural, generational, and occupational perspectives.
Let’s consider one of the real impacts of low diversity levels on boards and ELTs in a governance and risk sense. For the last 20 years, our firm has been at the coalface of digitisation across almost every industry. We have helped ventures as they build new business models and seek to expand, and we have helped mature and multi-national organisations and the firms that advise them as they have sought to navigate digital transformation and disruption.
Time and again, we have seen boards and leadership teams fail to fully appreciate the impact of new technologies, changing customer behaviors, and market shifts until it was too late.
Part of the reason we don’t see as much diversity is, no doubt, due to successful analog business leaders and stakeholders struggling with the concept of fixing something that isn’t yet broken. Another element, though, is that people who are alike tend to think alike. People who think alike tend to share similar perspectives, and people who share similar perspectives tend not to challenge each other. That’s why intellectual and tech diversity is so crucial – we need to keep challenging existing processes if we are to stay competitive.
Industries such as music, publishing, retail, and media are littered with high profile bankruptcies and failures. In each case, they just didn’t see it coming, even though the trends and evidence seem clear in hindsight, and the wreckage in other geographies and adjacent industries was abundant. Make no mistake, a good chunk of telcos, banks, insurers, utilities, and other industrials will be next (not necessarily in that order).
Now, more than ever, long-horizon thinking and a capacity to weigh risks and perspectives has never been more critical.
Gartner points to the impact of COVID-19, stating it may lead to an unprecedented acceleration of digital investment. The impact they describe is a shortage of skills with more than 58% of workforces reporting skill transformations since the onset of the pandemic – something we believe is already at critical levels in the boardroom and at CXO levels.
The 2018 McKinsey report, Delivering on Diversity, indicated that long-term value creation was as much as 27% higher for organisations with higher levels of executive and board gender and cultural diversity.
As someone who has sat on multiple boards as a Chair and Director, been through the transformation of both media, retail, sport, and broadcasting, I firmly believe that any board that doesn’t have a strong diversity of perspectives and a healthy spread of digital DNA is running the risk of creating terminal blind spots in governance and long-term value creation.
In these times, what is clear is that the very best thinkers in this space are ready, willing, and able to assist. Our networks are alive with incredible, diverse, and inspiring digital talent that will enable your business to prosper when driving digital transformation.
I encourage you to reach out to me directly to look at an effective solution to enhance the composition of your board and future-proof your business.