Supporting Diversity In The Boardroom
Many big companies worldwide are switching from the traditional boardroom strategy to the modern boardroom, which involves diversity. As business organizations continue to expand worldwide, setting up new office premises in different parts of the world, it is, therefore, necessary to implement a strategy that allows various people of diverse backgrounds to be part of the governing team of the organization. The board of directors must be able to execute its responsibilities effectively. For example, creating dividend policies, creating options policies, establishing compensation for executives, setting general company goals, and maintaining company resources must comprise people with different experiences and philosophies.
What is Boardroom Diversity?
Diversity on the board is when companies or organizations decide to bring different kinds of people on board based on the following factors,
● Age
● Religion
● Ethnicity
● Race
● Gender
● Skills
● Experiences
● Disability
● Thoughts and Philosophies
Why Boardroom Diversity?
Diversity comes with the following benefits, both to the company and the customers.
1. Making wise decisions
The diverse boardroom displays a range of choices used to address complex business problems. The different minds with different experiences and talents on the board enhance proper decision-making that helps the organization to grow.
2. The performance factor
In the modern business world, where companies need to apply modern ways of working, boardroom diversity is one of those ways we must stress to have efficient connectivity among the employees. In many organizations, where employees feel unrepresented because they don’t have anyone they can identify with on the board, it can hinder their performance at work. But on the other hand, diversity in the boardroom develops a special attachment and bond with the different employee groups in the organization and improves their performance.
3. Building a reputable brand
The inclusion of different communities on the board is a part of building a solid reputation and trust for the organization. Because of that trust, the local community’s bond with the brand becomes unbreakable. In addition, bidding for business from the state becomes easier because your brand is known and fully represented in the community.
4. Influencing gender diversity
The question of women in the boardroom is dealt with when companies apply diversity in the boardroom. Traditionally, most women are usually left out of the boardroom for cultural reasons, yet they have great importance if they are allowed to be part of the board.
How to support diversity in the boardroom?
Considering the benefits listed above, an organization should support diversity in the boardroom in the ways listed below.
The recruitment process
Recruitment is one of the practices that the organization should reconsider to implement diversity in the boardroom. There are mainly men in most boardrooms in various organizations, and this affects decision-making, which could favor, for example, women or young men. Therefore, directors must draft ways how to include them.
Recruiting people of different religions, genders, colors, ages, races, and experiences keeps the boardroom lit with heterogeneity.
Inclusion of people with Interpersonal skills
Most boardrooms usually have people with technical skills, but diversity requires people with interpersonal skills too.
Interpersonal skills are required to communicate effectively, interact, and work with individuals and groups.
It allows the boardroom to have people with different views because of their personal experiences and skills.
Conclusion
Boardroom diversity is a modern business practice that different companies are currently adopting. According to a study conducted in France two years ago, there was an increase in the number of female representatives on the board compared to the previous years. As the future holds, the traditional boardroom where primarily men were the majority is gradually vanishing to allow all types of people and colors to sit in the boardroom for effective modern business governance and management.
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