The late author Stephen Covey </strong>famously said: “Strength lies in differences, not in similarities.”</p> In the aftermath of the financial crisis, lessons have been learnt and companies around the world are waking up to the fact that fostering a diverse talent pipeline is crucial to success.</p> It is also important that they realise that the issue goes beyond the more visible aspects of diversity, such as gender and race, and encompasses aspects such as background, experience and thought.</p> In the build up to the new Diversity stream at Sibos 2015 Singapore, two of the leading global thinkers in this crucial area shared their thoughts on the subject.</p> Harvard academic and social psychologist Mahzarin Banaji </strong>aligns the argument for a diverse workforce with best practice in the investment world.</p> “To those who are the most naïve about financial investing, we give one piece of basic advice: diversify your portfolio; don’t invest all your money in only gold, or real estate, or stocks, or bonds. Why? Given the complexity of financial markets, it is obvious that to diversify is to protect our investments from the vagaries of the market.”</p> Banaji continues: “We seem well aware of the importance of diversity in so many spheres. So it is also when it comes to diversity in the workplace. A presence of diversity of both kinds – what has been termed “inherent diversity” such as gender, race, age, class, as well as “acquired diversity” such as different tastes and views and experiences – protects an organisation from the uncertainties of a changing world. It is no different than the value of diversity in all aspects of life: it’s adaptive.”</p> James Sun</strong>, a successful entrepreneur and leading authority on diversity and inclusion in the workplace</strong>, believes that the topic is more relevant due to the forces of globalisation.</p> “As globalisation becomes more prevalent,” he says, “financial companies are dealing with increased cultural diversity within the workforce. Differences in work ethics and religious differences are hot-button topics worldwide.”</p> There are a number of benefits associated with this wider cultural diversity, as Sun outlines: “Globalisation has reinvented the notion of the ‘global knowledge worker’. These are people with broad vision coupled with local insights who are optimally positioned to bring the latest innovations and international best practice to their customers. They know the local business landscape and connections between companies, the opportunities and constraints, and above all what makes people tick in the local culture and language.”</p> As companies realise that they can gain new insights, from both a management and a marketing standpoint, Sun accepts that things are getting better, but highlights that there is still a lot to do.</p> “The industry has embraced the ‘awareness’ part of diversity and it’s made large strides in this area. The next step is to go from awareness to action, and I think there needs to be a movement or call to action for global leaders to go beyond the ‘race’ topic and move towards embracing and encouraging the ‘unique individual’ as a strength.”</p> “Diversity needs to be seen as an inherent piece of every human being in the world, and to understand diversity is to appreciate this uniqueness in each person. We need to do some surgery - identify and reconstruct the hidden biases that all of us have.”</p> The threat of hidden bias</h3> When it comes to professional decision-making, the evidence suggests that our actions are often inconsistent with our values. Banaji gives an explanation for this, and elaborates on the concept of unconscious – or implicit – bias.</p> “Like many people, I have a strong value that I should always hire the best candidate available, irrespective of the person’s social group or social connections.”</p> “In any given instance, when I must choose between two candidates, say a woman and a man, I may feel that the superior of two candidates is a man. This may indeed be the case, and in that case I should most definitely choose the male candidate. I should do so because it is consistent with my values and it is best for my organisation.”</p> “But let’s say that I work in a field where the pool of candidates reflects a gender distribution that is 50:50. Now let’s say that I look at my own decisions over a 30 year period and I find that in 90% of the cases, when confronted with two choices, one male one female, I chose the male candidate. That should make no sense, given the base rates and given the large sample of decisions over many years.”</p> So why does this happen?</p> Banaji explains: “It happens, we now know, because of implicit bias. Implicit biases are nothing more than assumptions we carry around in our minds - such as men are more competent than women, that they are deserving of higher compensation and investment on our part, and that they have greater potential to succeed.”</p> “These biases are only able to influence our behavior because we are not aware of them. We believe, in any given instance, that we are making the “right” judgment when in fact it may well be a bias that induces that feeling. Leaders need to be aware of the role that implicit bias plays in order to do what is right by their organisations and also by their own internal moral code.”</p> “The most damaging aspect of implicit bias is that it can lead the best talent to ‘leak’ out of the pipeline, and it robs the world of competence and even extraordinary talent because we fail to recognise it.”</p> What of the regional differences regarding the issue of diversity? James Sun has some interesting insights.</p> “First, we have to realise that every country has their own biases in favour, or lack of favour, of certain nationalities and countries.”</p> “These hidden biases come from very long histories of war, conflict, and stories that have been passed down from generation to generation. In the United States, the biases are a bit younger due to the country’s relatively young history. However, when you look at regions in Asia, we are talking about centuries of inter-country history and biases.”</p> He adds: “On the one hand, many Asians identify with other Asians in the United States, however in Asian countries, there is a very clear distinction between factions of Asian races. The progress of diversity will need to deal with ‘Asia-to-Asia’ biases as we recognise our differences and come to a shared understanding that each culture has its place in a Greater Asia.”</p> The road to improvement</h3> What advice do Banaji and Sun have for business leaders looking to tackle this pressing issue?</p> “To seek out and be comfortable with diversity is not a natural taste,” says Banaji. “Human beings are attracted to others who are like themselves. Such attraction serves many functions, like creating harmony through shared assumptions and the pleasant feeling of agreement. But diversity is necessary because through honest disagreement come great advances.”</p> “Solutions to hard problems come from disruptive thinking and that’s more likely with diversity. As clients and customers become more varied, the presence of diversity in the workforce allows quicker recognition of what is being demanded and an ability to provide it.”</p> Sun concludes: “First, financial leaders will need to improve their ability to foster and support cross-cultural business ventures (even in a domestic market). Second, they will need to develop leaders who are passionate about communicating and managing across cultures, and interested in unleashing the creativity and innovation potential of a culturally-diverse workforce. And last, they will need to integrate and develop a diverse workforce, particularly in terms of culture and age differences.”</p> We invite you to join us on 13 and 14 October</a> in Singapore as we explore these issues in depth during Sibos week. Watch our video for a preview of the sessions.</p> </p>