How well are Australian organisations ‘capitalising on culture’ in the senior ranks?
6 December 2011

In its survey of over two thousand executives and their direct reports, a landmark research study conducted by Diversity Council Australia (DCA) and launched today by Senator Kate Lundy, Parliamentary Secretary for Immigration and Multicultural Affairs and writer, broadcaster Waleed Aly, has measured just how culturally diverse the executive ranks and immediate pipeline are in a key part of the professional services sector and ANZ in Australia.

Nareen Young, DCA’s CEO said findings showed an encouraging depth and breadth of cultural and linguistic diversity at the most senior levels and in the leadership pipeline, but also revealed a need to capitalise more on talent who possess a non-English speaking cultural identity:

“Today, Australians come from more than 200 countries, identify with more than 270 ancestries and speak almost 400 languages including 164 Indigenous languages. If Australian organisations are to leverage fully the business opportunities of culturally diverse local, regional and global markets, they need to genuinely value cultural diversity and the inter-cultural capabilities this can bring, and tap into Australia’s culturally diverse talent pool. Our research findings underscore the need for employers to build understanding and engagement around cultural diversity,” said Nareen.

DCA, corporate sponsors Deloitte, ANZ, Mallesons Stephen Jaques and Goldman Sachs, and participating organisations hope this project and its findings will constitute a ‘call to action’ for Australian organisations to better measure and capitalise on cultural diversity in the workplace.

Key survey findings

The survey found some encouraging breadth and depth in cultural and linguistic diversity amongst senior executives and their direct reports:

  • Senior executives and pipeline executives held citizenship of 65 different countries and represented 107 different ancestries. Fifty-seven different languages were spoken across survey participant homes.
  • The percentage of senior executives and pipeline executives who were born overseas was higher than that in the Australian general community (41% versus 27%), and they are variously born in a total of 77 different countries.
  • In general, different cultural and religious groups were represented at levels roughly equivalent to that found in the broader Australian community.
  • When looking at second-generation cultural diversity, the degree and breadth of cultural diversity increased – 54% of participants had parents who were born overseas, representing a total of approximately 90 countries of birth.
  • The leadership pipeline was somewhat more culturally and linguistically diverse than the senior executive workforce, in relation to country of birth, parents’ country of birth and main languages spoken at home.

In terms of inter-cultural or diversity capability, measured through reference to global experience, multilingual ability and multiple cultural identities, the survey found:

  • Forty percent of participants were bi or multilingual, approximately 30% possessed a bicultural or multicultural identity and just over 20% had a high degree of global experience.
  • Senior executives and pipeline executives were proficient in a total of 80 different languages.
  • Over 60% had lived and worked in countries besides Australia and over 50% regularly interacted with clients and colleagues overseas in their current role.
  • Collectively, survey participants had lived and worked in 114 different countries and had regular business interactions with at least 72 different countries.

The survey uncovered the following opportunities for organisations to better capitalise on cultural diversity:

  1. Increase the proportion of senior executives and pipeline executives who originate from non-Main English Speaking Countries (MESC) and who speak a language other than English (the majority of participants were born in either Australia or MESC (86%), these being Canada, New Zealand, the Republic of Ireland, South Africa, the United Kingdom, and the United States of America);
  2. Develop a talent pool of senior executives and pipeline executives who originate from a broader range of countries of birth and ancestries and who speak a broader range of languages (while broad cultural groups were represented at levels roughly equivalent to that found in the Australian community, often only a limited number of countries were represented in each broad group e.g. 94% of overseas participants born in Southern and Central Asia were from either India or Sri Lanka); and
  3. Increase the degree and breadth of cultural diversity in the immediate leadership pipeline.

The CEOs of corporate sponsors Deloitte, ANZ and Mallesons Stephen Jaques explained the importance of the research and why they supported it:

"At Deloitte we believe every person, no matter what their culture or religion, should have the right to aspire to every role. We are creating an environment where valuing diversity in thinking becomes one of our greatest assets,” said Giam Swiegers, CEO of Deloitte.

“‘Capitalising on culture’ is particularly important for ANZ as we seek to grow our business across Australia, New Zealand, Asia and the Pacific – building a truly super regional bank. A vibrant and engaged workforce with people who understand and can connect with our customers, teams and markets wherever we operate and whatever their cultural background, is a critical foundation for the success of our strategy,” said Mike Smith, CEO of ANZ.

“Whilst Australian business is making some encouraging progress in relation to gender diversity, we have yet to replicate this in the area of ethnic and cultural diversity – yet the business case is equally valid. Cultural diversity has a hugely valuable role to play in the generation of diverse thinking and in underpinning our ability to anticipate and exceed client or customer needs and expectations,” said Robert Milliner, Chief Executive Partner of Mallesons Stephen Jaques.

Survey methodology

DCA deemed a focus on cultural diversity amongst executives timely given the longstanding (deserved) attention given to women in leadership in the Australian business context and the need to direct commensurate attention to cultural diversity in leadership.

DCA’s survey tool adopted a contemporary approach to ‘counting culture’ that addressed:

  • Cultural diversity broadly, including ancestry, citizenship, country of birth, ethno-religiosity, faith and language;
  • ‘Intersectionality’, including information on multiple and intersecting dimensions of cultural diversity such as age, care-giving responsibilities, gender, disability status, parental status and sexual orientation;
  • Cultural identity, that is, the ethnic or cultural groups employees felt most strongly affiliated with;
  • Diversity capability, in the form of employees’ multiple cultural identities, multilingual abilities and global experience; and
  • The need to capture information on employees’ cultural diversity in an inclusive and respectful manner.

Five DCA member organisations in the professional services and financial services sectors that have a high level of engagement around cultural diversity in their workplaces participated in the survey. These organisations were Deloitte, Ernst & Young, KPMG, PwC and ANZ. The on-line survey was distributed to all their Australian senior executives and direct reports – 5762 staff – and 2186 responses were received, resulting in a 38% response rate.

For a copy of the full report, DCA members can visit the members-only area of the DCA website at http://dca.org.au/cultural-diversity/read-more-on-research-on-cultural-diversity.html.

DCA thanks ANZ for kindly hosting the launch event.

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