Diversity quotas encourage businesses to meet certain targets around more inclusive workplaces – but they can be polarising. One argument suggests they can be an effective way to ensure finance teams include people with many different views. Another perspective is that they can make it difficult for people to be promoted on merit alone.
There is no one-size-fits-all approach to the right diversity strategy in a finance team. But the foundation generally starts with an appropriate culture, a CFO who is a genuine leader, and talent development.
The Diversity Council of Australia's Suncorp-DCA Inclusion@work index found a groundswell of encouragement for more diverse workplaces.
According to the research, 75 per cent of Australian workers support or strongly-support their place of work pursuing a diversity strategy.
The study also found working in an inclusive team means staff are ten times more likely to be highly effective than people who don't work in diverse groups.
“CFOs need to lead from the front with a people-oriented and inclusive culture that supports differences, makes employees feel valued and respected and rewards people on merit," says David Cawley, regional director for recruitment firm Hays Accountancy and Finance.
“With real commitment, encouragement and leading by example, an organisation's top executives can enable progress by supporting programs to encourage diversity. CFOs also need to look at the flexible working options the organisation offers," he advises.
Finance teams normally have operational targets in place. Therefore, it should be theoretically an easy process to extend targets to workplace diversity. But quotas and targets can be a challenge to manage.
“If you are thinking of quotas, our suggestion is to explore voluntary team-specific gender, mature-age, disability, multicultural and indigenous representation targets for each job vacancy shortlist," says Cawley.
The type of target can depend on the business. Large teams may aim for at least two candidates for each group. For smaller organisations, one candidate might be more appropriate.
Realising the advantages of diversity
Whether or not the business has targets, Cawley says CFOs need to appreciate the benefits of recruiting a diverse workforce.
“Start with a diverse shortlist. Unconscious bias is often present before an interview starts. CFOs need to know how to recruit based on a set of criteria and how to recognise their own unconscious bias. This needs to be brought to managers' attention because it cannot be changed unless we are aware of it," he says.
As an example, unconscious bias happens when people unwittingly assume the gender for roles such as surgeon, nurse or electrician.
“As CFO, when hiring staff, you should focus on attributes, skills and experience. Some finance teams and organisations also provide training for staff on diversity and development programs aimed specifically at minority groups," says Cawley.
Diversity increases potential
Greater innovation and heightened creativity are two potential benefits of a more diverse finance function.
Cawley says that a diverse team could deliver huge creative potential to an organisation. He points out that a workforce that can embrace difference might unlock creativity and innovation in problem-solving because of the variety of different viewpoints, backgrounds and experiences available within the team.
The DCA-Suncorp Diversity@Work index found diverse teams are nine times more likely to innovate than teams that are not inclusive.
By having a diverse team, there should be a greater number of ideas and suggestions put forward which might help the team arrive at the best possible outcome.
Cawley acknowledges that this might lead to some lively workplace debates. However, he suggests that it can also offer new ideas and approaches compared with a workplace that only employs the same type of person. He adds that a team that continues to deliver the same attitudes and solutions to address problems is not a team likely to bring about much innovation.
Improved attraction and talent retention is another potential advantage of a more diverse team.
The Inclusion@work index showed people in diverse teams are 19 times more likely to be very satisfied with their job than workers in non-inclusive teams. They are also four times more likely to stay with their employer and twice as likely to be offered professional development opportunities.
Cawley believes that employers who limit diversity parameters might be limiting the number of candidates they can consider and thereby not finding the very best person for the job. “You're more likely to identify the most suitable skills and experience when you actively target a diverse pool of candidates for job vacancies," he says.
A fully diverse workforce sends a strong message to employees and candidates that the team is accepting of all and helps businesses become known as an employer of choice.
Says Cawley: “This can be a very strong differentiator in the candidate market. And when you're accepting of all and value people, you gain a very solid staff retention benefit."
Another benefit of diversity is that it creates an environment in which employees are encouraged to be the best they can be regardless of gender, age, disability, or ethnic background.
A meritocratic business could potentially build a high-performance culture as employees have equal opportunity to progress based on proven measurable results. Because employees are rewarded and promoted based on their performance alone, they will themselves be driven to achieve high workplace standards and results.
In a workplace that functions as a meritocracy, the best workers are promoted based on their performance alone and the best ideas are implemented. “The people who are respected, rewarded, and promoted have put in the work, gained results, and proven themselves and the results are celebrated. Other factors do not figure in promotion decision making," Cawley argues.
“This means you always get your best team on the playing field, not the team who has served the longest," he adds.
Whichever approach CFOs take, it's important that they lead by example and foster an inclusive workplace where people are encouraged to express different points of view.
Building a finance team that embraces diversity and is collectively focused on finding new ways to achieve great outcomes will help it drive innovation and results both now and into the future.
Key Takeaways
- More diverse teams foster creativity and innovation.
- Inclusive teams improve staff retention.
- Finance chiefs considering introducing diversity quotas could start with voluntary targets.