Much recent attention has been given to the need for more inclusive leadership at the political level in Australia. But do organisations understand the benefits of having inclusive leaders, especially as workplaces become more diverse?
International research clearly shows that organisations need to cultivate an inclusive workplace in order to experience the benefits of diversity. However, Diversity Council Australia (DCA) has found there is room to improve the inclusive leadership capabilities of Australian managers. Through interviews and a review of national and international research, DCA’s new study, Building Inclusion: An Evidence-Based Model of Inclusive Leadership released on 22 October 2015, sheds valuable light on the need for inclusive leadership and what it takes build more inclusive leaders.
Key findings include:
Leaders are critical to the success of D&I initiatives but there is a lack of inclusive leadership capabilities amongst Australian managers:
- Interviewees rated the current level of inclusive leadership capability of senior leaders in their organisation relatively low. The average score out of ten was 5.8 with 26% rating it as either 5 or 6; and 17% rating it as being below 5.
- Earlier DCA research found only 11% of Australian workers strongly agree that their manager actively seeks out information and new ideas from all employees to guide their decision making – a key capability of inclusive leaders. And Australian workers from culturally diverse backgrounds are up to three times less likely to experience their workplaces as inclusive.
This means organisations are missing out on the benefits of inclusive leadership:
- Profit & performance. Inclusive environments are associated with improved job and/or team performance, as well as higher return on income and productivity.
- Innovation. Teams with inclusive climates have higher levels of innovation and profit. Having a flexible rather than fixed view of one’s own and other’s identities – a key attribute of inclusive leadership – is associated with greater creativity and improved innovation.
- Engagement & opportunity. Inclusive leadership is associated with greater team engagement, while individuals working in more inclusive team climates report higher levels of commitment and satisfaction, and demonstrate access to better job opportunities and career advancement.
- Well-being. Inclusion is associated with a higher sense of employee well-being and psychological safety, as well as employees feeling valued and respected. Exclusion is associated with emotional exhaustion, which in turn affects turnover intentions.
- Productive conflict. In inclusive teams, employees are better able to resolve conflict and be more satisfied as a result of having worked through the conflict effectively. Inclusion is linked to effective and productive resolution and integration of differing viewpoints.
- Legal risk. In inclusive climates, individuals from traditionally marginalised groups experience lower levels of harassment and discrimination. More advanced attitudes about social identity – a key attribute of inclusive leadership – are linked to more positive inter-cultural group relations and less cultural bias.
- Talent costs. Inclusion and inclusive leadership are associated with reduced turnover. Indeed, workplaces that encourage employees to voice their opinions and be involved in decision making have on average 33% lower employee turnover.
Australian leaders and organisations can build their capabilities by adopting DCA’s five mindsets of an inclusive leader:
- Identity aware. Believes diversity can significantly improve organisational performance, and so learns about their own and others’ identities (e.g. age, gender)
- Relational. Creates teams and networks in which a diversity of people feel they belong, and are valued and respected
- Open and curious. Is curious about and open to new and different perspectives from a diversity of people
- Flexible and agile. Is flexible about, and responsive to, a diversity of people and perspectives
- Growth-focused. Challenges accepted practices and incorporates different perspectives into how business is done.
Members can access the full report.
Building Inclusion: An Evidence-Based Model of Inclusive Leadership is a partnership research initiative between DCA, Stockland, ANZ, Programmed and Optus.
Want to Use Our Research?
Where you wish to refer to our research publicly, it must be correctly attributed to DCA.
- Formal attribution to DCA is required where references to DCA research material are in a written format.
- Citing DCA as a source will suffice where the reference is made in a verbal format.
The suggested citation for this report is:
Diversity Council Australia (O’Leary, J., Russell, G. and Tilly, J.) Building Inclusion: An Evidence-Based Model of Inclusive Leadership, Sydney, Diversity Council Australia, 2015.