Importance of Inclusive Boards
4th October 2023
Marshalls have recently expanded our course library with a new advanced diversity skills range. Within this suite of courses, we explore the significance of diversity, equity and inclusion (DEI) across organisations at every level, including board level. To delve deeper into the value of inclusive boards, we consulted Teresa Norman, a diversity and inclusion consultant, writer, analyst and facilitator with a strong background in HR. She has worked closely with Marshalls on a number of projects, and most recently her work was featured within our Leading Diversity, Equity and Inclusion for Boards and Senior Teams micro-learning course.
To determine how to lead DEI effectively, Teresa sat down with Meg, our graduate eLearning content writer, to discuss the importance of diversity and inclusivity across boards. Here’s what we learned:
“Inclusive boards aren’t just a nice thing for an organisation to have – they are critical.”
Teresa, you’ve recently written a white paper on Inclusive Board Leadership, highlighting the links between the lack of inclusion and diversity at the most senior levels with corporate disasters. What led you to write on that topic?
I was reading books like Shredded, which is about how the Royal Bank of Scotland’s hubris led to a significant financial collapse – and listening to a podcast investigating the British Post Office scandal, the story of how sub-postmasters were wrongly targeted and some sent to prison for supposed crimes they had never committed. As I work as a Diversity Consultant, I was making connections through a diversity and inclusion lens. Had the corporations involved in these disasters focussed more on diversity and inclusion, perhaps these incidents wouldn’t have happened. If we can learn from these disasters we can try to prevent history from repeating itself.
Board diversity has become increasingly important to organisations, with non-diverse boards being held accountable. What is behind the push for diverse boards?
There has been a push for diverse boards because of the need for equity and different perspectives. There’s lots of research from major consultancies that shows that more women and more ethnic minorities on boards leads to better decisions and better financial outcomes. There have also been reports setting targets for FTSE companies: The Hampton-Alexander report set a target of 33% of women on Boards in the FTSE by 2020, the Parker Review of 1 ethnic minority on Boards by 2024.
Few have approached diversity and inclusion from the same lens as I have, which is examining corporate disasters and identifying the lack of DEI initiatives. The primary approach to diversity and inclusion is to focus on the positives, ie the benefits that come from focusing on DEI, including stronger performance or greater employee satisfaction. Making a positive case for diversity and inclusion is essential, you don’t have to focus on the disasters that happen in its absence for it to be a worthwhile focus.
Despite the newfound appreciation of diverse boards, change is slow. Why do you think that is?
Change related to diversity and inclusion always take a long time because it’s society wide. For example, consider the fact that it took 100 years for the idea of the Museum of African American History in Washington, DC in the United States to become a reality. Another instance is that there was a 60-year gap between the first female MP in the 1920s and the first female Prime Minister in the 80s. You need to be patient with diversity and inclusion – positive change often takes time and you also have to fight for it, be activists, find role models and challenge the status quo.
We know board diversity often focusses on gender and ethnicity. Are other aspects or dimensions of diversity important to have on a board? Should the focus be on the equality protected characteristics, such as age or disability, or does it go wider than that?
I think it’s most important that there is diversity of thought – it should be about whose voice you need to hear. Sometimes that will be the voice of staff members. For example, on an NHS board you’d expect a clinician to be present; for a migration and refugee charity, it would be important to have someone with lived experience.
I think it’s not so much about protected characteristics, but more about making sure that different voices in your organisation are heard.
What are some of the challenges faced in terms of increasing diversity of board membership? And how can they be addressed?
It starts with recruitment and succession planning. Boards can be upfront that they are looking for people from diverse backgrounds and communities when advertising for a role.
It’s also important to demystify the board’s role. To do this, depending on where you work, you can consider inviting people into board meetings to gain insight into how they function. Some organisations create shadow boards, which are essentially ‘mock boards’ where people can practice contributing to discussions, while others offer mentorship to potential candidates so that they have relevant skills and experience when they are ready to apply to fill a vacancy.
Inclusivity is important not just during the recruitment process, but also once the new hire is made. If you recruit someone to the board and they feel marginalised, they will not be able to make their full contribution.
We’ve discussed board representation regarding diversity, but that’s only one aspect of the larger conversation. What about leading inclusively? What does it look like and why is it important?
Leading inclusively is about setting high standards for behaviour, challenging discriminatory behaviour, managing debates effectively and sometimes giving difficult feedback.
It is also about being helpful and considerate in your everyday actions. It’s about appreciating efforts, acknowledging different voices and being curious about other views and taking them into account before making decisions.
There’s a brilliant blog post about decision-making by Barack Obama which I use as a guide – particularly his point that you should hear from everyone in the room, but not rush to make a decision. The pressure to make an immediate choice can lead to decisions made from bias and top of the head thinking but decisions can’t be left hanging either – you must judge how much time you need to reflect well and be transparent about when your decision will be made.
What questions do boards need to reflect on as a group to ensure that they are operating inclusively?
Have we had a range of opinions? Are there different voices we should listen to? Have we dismissed anyone’s views because of who they are and not because of their argument? Are we so fixed on something that we cannot hear another view? Are we prioritising the short term over the longer term? Have we had enough time to reflect?
Consider the Shredded case mentioned earlier. The board was pressured into making a really important decision that went on to wreck the UK economy on a Sunday. They didn’t have enough time to reflect on all the risks and many people suffered as a result.
What are your hopes for the future in relation to inclusive boards?
I hope that we can learn from what’s gone wrong, and that boards can have respectful debates and welcome people who address problems from different angles with alternative perspectives. I also hope that boards become more reflective of our diverse society. Inclusive boards aren’t just a nice thing for an organisation to have – they are critical.
How to lead inclusively with Marshalls
As part of our new diversity microlearning suite, Marshalls have a designated course on this topic titled Leading Diversity, Equity and Inclusion for Boards and Senior Teams. This engaging, accessible, and informative e-learning course equips board members and senior professionals with a thorough understanding of how to lead inclusively and foster a diverse culture. Be sure to check out our most popular diversity in the workplace eLearning course.
We were delighted to have had the opportunity to discuss the significance of diverse and inclusive boards with Teresa. You can find her LinkedIn profile here.
For a demo of our Leading DEI for Boards and Senior Teams course, or any of the five courses from our new diversity microlearning suite, please contact David Marshall at dmarshall@marshallacm.co.uk or enquire here.
