Most companies have some type of diversity commitment in their values statements, from inclusive hiring practices to equity-focused employee resource groups.
Despite widespread corporate interest in diversity, equity, inclusion, and belonging (DEIB), many organizations fail to implement these values within leadership roles, with corporate boards being particularly vulnerable to lack of diversity. In the United States, people of color hold just 12.5% of board positions at Fortune 500 companies. Globally, women are on less than 20% of boards, according to a 2022 Deloitte study.
Such lack of leadership inclusivity is a contradiction to organizational DEIB and environmental, social, and governance (ESG) goals, explains Karen Perham-Lippman, co-editor of Inclusive Leadership: Equity and Belonging in Our Communities (Emerald Publishing, 2023) and founding member of Senior Executive’s DEI Think Tank.
Here, Karen outlines how companies can mitigate diversity gaps at the highest levels of corporate leadership so that everyone within an organization can feel like they belong.
1. Tokenism doesn’t elevate DEIB or ESG initiatives
There’s a close link between inclusive leadership and ESG. “The idea of a true ESG report means embedding DEIB into a business strategy rather than promoting tokenism — which only provides an illusion of diversity without substantive inclusion,” explains Karen.
Tokenism is the act of making only a symbolic effort to be inclusive of underrepresented groups. It involves appointing a small number of people from minority backgrounds to leadership roles in order to give the appearance of racial or gender diversity.
However, tokenism does not lead to meaningful change or promote diversity of thought. “Genuine inclusion requires going beyond just representation numbers to empower underrepresented groups and ensure they have a voice at all levels of an organization,” says Karen.
2. Understand your current employees and leadership
The first step to elevating DEIB within a corporation is taking an honest look at employee demographics across all offices and teams. Examine the data to see who is present at each level. If you find that you don’t have diversity data at your organization, consider implementing a voluntary employee self-identification campaign to get a clearer picture.
Then, inspect your leadership programs through a diversity lens. Who actually has access to these programs? Are marginalized groups equitably represented? This analysis will reveal obstacles to inclusion.
“With these insights, you can start dismantling barriers and enacting policies that foster true inclusion and belonging,” says Karen.
3. Learn about Asch’s Conformity Theory
Asch’s Conformity Theory conveys that individuals are influenced by the opinions of the groups they are a part of. In order for groups to reach a decision, there must be a critical mass of similar decisions.
“Asch’s theory is saying that if you only have one minority voice in the room, typically that voice is going to get drowned out,” says Karen.
“It’s why companies need to move beyond tokenism. If there’s a critical mass of an underrepresented group, you can make a shift to normalizing dissent and the sharing of the ideas. That’s true inclusive leadership.”
4. Address current board diversity using “BOARDS”
Explore the practical way Karen and her co-authors Yolanda Caldwell and Tissa Richards developed and recommend to build inclusive leadership for existing board members using the easy-to-remember acronym “BOARDS”.
This strategy is found in their chapter, "Achieving Societal Equality by Building Inclusive Corporate Boards," within Inclusive Leadership: Equity and Belonging in Our Communities.
These tips can also be used in other leadership groups across the organization, including executive and management teams.
B: Board assessments can enable you to understand the current make-up of your board members, and identify gaps, strengths, and peer-mentoring opportunities.
O: Onboarding procedures should include inclusivity training.
A: Awareness and opportunity campaigns related to corporate management.
R: Recruitment for board positions can be widened via peer-mentoring and informational interviews.
S: Succession plans should be annually reviewed and assessed.
The business case for inclusive leadership
Research suggests that companies with greater diversity are more financially successful than their less diverse counterparts.
Diverse teams typically have a greater variety of ideas and perspectives, making them more likely to generate innovative solutions to complex problems. Likewise, executive teams with greater gender parity are more likely to outperform those with fewer women or none at all, according to a 2020 McKinsey report.
Creating an environment for inclusive leadership takes work. But the business case for diverse executives and boards remains clear. Focusing efforts on building a diverse executive team will enable corporations to put their DEIB and ESG values to action.