3 Steps to Help Your Company’s Leadership to Reflect Its Workforce

The focus on diversification of senior leadership and corporate boards is intensifying along with growing acknowledgement that the principles of ESG—environment, social and governance—can impact financial performance.

That said, even as executives across industries assert their good intentions—“We would like more diversity in senior leadership”—they confirm their bias—“But we also have to make sure we get the best people.

The second half of the statement is a cringe-worthy moment for some, a matter of fact assertion for others. Its ill-seeming nature may be attributed to what it implies: that seeking talent beyond white males takes us into sub-standard territory. It assumes there are simply not enough qualified women, people of color, or others from diverse backgrounds from which to select potential candidates.

Regrettably, there is a wealth of research demonstrating that “organizational cultures and practices designed to promote meritocracy actually accomplish the opposite.” This is what is known as the fallacy of meritocracy, which is essentially an attachment to meritocratic ideals. As summed up in this Atlantic article—The False Promise of Meritocracy—“If a company evaluates people on their skills, abilities, and merit, without consideration of their gender, race, sexuality etc., and managers are objective in their assessments then there is no need for diversity policies, the thinking goes.” Further, even those who think they are objectively basing decisions on merit often introduce the most bias in their assessments.

The partial cause for this may be attributed to systemic biases that exist outside of the workplace in our communities, culture, and educational system. These systemic biases reinforce hiring, retention, promotion and pay problems in the workplace.

In his Forbes.com article titled Meritocracy is a Chimera, Paolo Guadiano notes that employers upholding a meritocracy will, “albeit unwittingly, continue to perpetuate the systemic biases that favor those already in the majority.” Additionally, Guadiano, the founder of the center for the Quantitative Studies of Diversity and Inclusion at the City College of New York, notes that “absent a completely inclusive culture in a company that is highly diverse, meritocracy—whether intentionally or unintentionally—is simply a way of perpetuating systemic biases and sanctioning discrimination.”

This assessment is a hard pill for folks to swallow, especially those who believe they are in their positions of power due to their own meritocratic rise. One important way to counter the tendency for assumed meritocracy to exacerbate inequality is by focusing on accountable and transparent practices that lead to more fairness and equity.

For example, we shouldn’t simply hire or promote from our own professional or family networks. This seems obvious, yet nepotism remains a predominant feature of staffing and board placement in many corporate and non-profit organizations. If we were to use more accountable and transparent practices, then our board and staff would better reflect the workforce and the customers we serve. That might happen by reaching outside our collective networks to groups of professionals representing different affinity groups, or by any of a variety of other techniques that build more equity into our recruitment systems.

Following are three simple steps to start building equity into organizations’ executive and governance structures:

  1. Have your senior leaders read The Atlantic article and ask for their ideas at your next senior team meeting. If this suggestion seems “off the mark,” examine whether learning and self-assessment are core elements of your corporate culture.  Learning is a fundamental requirement for achieving more equitable outcomes. If this suggestion seems “on the mark,” begin to include a broader cross-section of staff in business discussions.
  2. Gather information on the diversity profile of your board, senior leadership team, and staff.  If relevant, extend the same assessment to your customer base. How diverse are these groups with respect to race, gender, etc.? Compare the profiles. Is the board less diverse than your senior team, how about your staff or customer base? Some think the constitution of their executive leadership should be different from their staff, their customers. To guard against such fallacious reasoning, examine why this is so. What qualities or characteristics do your leaders represent that you don’t think are present in your staff or customers. Do you have data and facts to help understand the extent to which these qualities might exist in your current or potential staff or customer base?
  3. What are your board recruitment, staff promotion and hiring practices like? If you tend to hire senior leaders from outside the organization, what prevents promotion from within the organization? If you have some departments with greater diversity, learn more about the hiring and promotion practices in those departments. Are there hiring sources you can use that represent a more diverse professional base?

As acceptance of the connection between financial success and adherence to ESG principles increases, attention to the growing inequities in health and wealth is also building. At the employer level, there is a parallel need for the tools necessary for greater transparency and accountability; tools that enable advancement of the governance ideals embodied in the principles of ESG.

We should want senior leaders who aren’t afraid of accountability. They should be able to examine their own potential biases, and hear the viewpoints and perspectives of others. We will not have a more just world, nor more equitable outcomes, until there is rigor applied to the way we learn and make decisions based on what we learn.

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