Diversity in Organisations and Risk Management Capability

“We need a diversity of thoughts in the world to face new challenges. A diverse and inclusive workforce is critical for success”. – Tim Berners-Less

“We need to give each other the space to grow, to be ourselves, to exercise our diversity. We need to give each other space so that we may both give and receive such beautiful things as ideas, openness, dignity, joy, healing, and inclusion”. – Max de Pree

In politics, diversity refers to the political and social policy of encouraging tolerance for people of different backgrounds. It is the state or fact of being diverse, different, and unlikeness, the inclusion of individuals representing more than one national origin, colour, religion, and socio-economic stratum.

This is recognised as the condition of having or being composed of differing elements, variety especially the taking of different types of people in a group or organization. According to Merriam Webster Dictionary, this is the instance of being diverse.

The concept of diversity encompasses acceptance and respect, which means understanding that each is unique and recognising our differences. This can be along the dimensions of race, ethnicity, gender, socio-economic status, age, physical abilities, religious beliefs, political beliefs, and other ideologies. It is the exploration of these differences in a safe, positive, and nurturing environment.

It is about understanding each other and moving beyond simple tolerance to embracing and celebrating the rich dimensions of diversity contained within each individual. According to the Cambridge Dictionary, diversity is the phenomenon where there are different ideas or opinions about something. A diverse mix of voices leads to better discussions and outcomes for everyone.

The business case for diversity stems from the progression of the models of diversity within the workplace since the 1960s. The original model for diversity was situated around affirmable action drawing strength from the law and the need to comply with equal opportunity employment objectives. This compliance-based model gave rise to the idea that tokenism was the reason an individual was hired into the company when they differed from the dominant group.

The social justice model evolved next and extended the idea that individuals outside the dominant group should be given opportunities within the workplace, not because it was the law, but because it was the right thing to do. This model still revolved around tokenism, but it also brought in the notion of hiring based on a “good fit”.

In the deficit model, it is believed that organisations that do not have a strong diversity inclusion culture will suffer lower productivity, higher absenteeism, and higher turnover which will result in higher costs to the company.

“Diversity means all the way individuals differ in the company. Some of these differences individuals are born with and cannot change. Anything that makes an individual employee unique is part of this definition of diversity”.

There are three organization types that focus on the development of cultural diversity. These three types are the monolithic organisation, the plural organisation, and the multicultural organisation.

In the monolithic organisation, the amount of structural integration (the presence of persons from different cultural groups in the organisation) is minimal. This type of organisation may have minority members within the workforce, but not in the positions of leadership and power. .

The plural organization has more heterogeneous membership than the monolithic organisation and takes steps to be more inclusive of persons from cultures that differ from a dominant group. This type of organisation seeks to empower those from a marginalised standpoint to encourage room for upward movement in the organisation ladder and the positions of leadership.

The multicultural organisation on the other hand, not only does it accommodate many diverse cultural groups but also values this diversity. It encourages healthy conflicts as an enabler of avoiding groupthink.

Diversity means all the way individuals differ in the company. Some of these differences individuals are born with and cannot change. Anything that makes an individual employee unique is part of this definition of diversity, and diversity is logically linked to inclusion.

Inclusion involves bringing together and harnessing these diverse forces and resources, in a manner that is beneficial in terms of value creation. Inclusion puts the concept and practice of diversity into action by creating an environment of involvement, respect, and connection, where the richness of ideas, backgrounds, and perspectives are harnessed to create business value. Companies need both diversity and inclusion to be successful.

“Cross-functional teams composed of men and women who are intergenerational and deeply and broadly diverse stimulate thinking, which leads to greater possibilities”.

Many companies do struggle and do not realise the full potential of a diverse and inclusive workforce. These companies might still be focused on numbers and lack a complete understanding of the business imperative. While diversity in companies is increasingly respected as a fundamental characteristic, neither its acceptance nor appreciation equates to an inclusive workplace where unique vantage points of diverse people are valued.

Inclusion enhances the company’s ability to achieve better business results by engaging employees from diverse backgrounds and perspectives through participatory decision making. Every company leader, executives, and board of directors aspiring for success by way of value creation for shareholders and the other stakeholders ought to begin with a critical but simple inquiry; What actions is my company taking to foster an inclusive work culture where the uniqueness of beliefs, background, talents, capabilities, and ways of living are welcome and leveraged for learning and informing better business decisions?

This inventory of actions must begin with a macro view of diversity, considering workforce, supplier diversity, philanthropy, and communication company systems must be assessed to determine the extent to which equitable access is provided to all. Achieving an inclusive work environment is a cultural change initiative, but it does require a lot of undertakings.

by Amani Mbuja Tuntufye ERMCP, CERG
Part 2