In an Australian first, DCA's new research called Capitalising on Culture: A Study of the Cultural Origins of ASX 200 Business Leaders and released on 23 October 2013, reveals the cultural origins of board members and senior executives in our major listed companies. Whilst it found some encouraging breadth and depth in cultural diversity amongst business leaders, it also identified some underrepresentation in key areas, especially when compared with the general population.
Produced in partnership with the federal government’s Australian Multicultural Council, and PwC Australia, the Australian Government and IBM Australia, the research analysed the personal and family names and company, occupation and gender of board members and senior executives of ASX 200 companies. From the research, DCA made a series of recommendations to assist organisations to better measure and capitalise on culture.
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Suggested citation: Diversity Council Australia (O'Leary, J.) Capitalising on Culture: A Study of the Cultural Origins of ASX 200 Business Leaders, Sydney, Diversity Council Australia, 2013.
Capitalising on Culture in Australian Boards: An ASX200 Survey
DCA, in partnership with the Federal Government’s Australian Multicultural Council and sponsors the Department of Immigration and Border Protection and PwC (with supporting sponsor IBM), are conducting a survey which aims to capture the culturally diverse profile of ASX200 Boards. The project aims to deliver industry-driven research, comparable to the EOWA Census of Women in Leadership, in order to generate a greater understanding of and engagement with, cultural diversity in Australian workplaces.
This project has been conceived by DCA, with some of Australia’s leading diversity employers in the industry. It builds on and extends DCA’s innovative Capitalising on Culture: A Study of Cultural Diversity amongst Australian Senior Executives and their Immediate Pipeline. This research project developed a first-of-its-kind survey tool to capture the culturally diverse profile of senior leadership groups in the ‘Big 4’ accounting and business services firms (i.e. Deloitte, Ernst & Young, KPMG, PwC) and ANZ. DCA proposes utilising this rigorously developed and tested survey tool to measure the degree and breadth of culturally diverse talent amongst Australian Board Directors.
Through this project, DCA aims to inspire Australian businesses to value cultural diversity and the inter-cultural capabilities this can bring, and thus source Board and executive talent from culturally diverse local, as well as regional and global settings.
The research found some encouraging breadth and depth in cultural diversity amongst business leaders. But it also identified some underrepresentation in key areas, especially when compared with the general population.
Key findings include:
- Some 22.2% of directors are ‘culturally diverse’ (referring to people from non-Anglo-Celtic cultural origins, i.e. European, Asian, African, Middle Eastern and Pacific Islander origins), 21.9% of CEOs, 19.9% of senior executives and 13.5% of chairs. This compares to 32.2% in the general Australian community;
- When a narrower definition of ‘culturally diverse’ is adopted (i.e. excluding people from North West European cultural origins), the degree of culturally diverse business leaders drops by at least half. The proportion of culturally diverse directors falls to 11.3%, culturally diverse CEOs falls to 11.4%, culturally diverse chairs to 7.0% and culturally diverse senior executive positions to 9.7%. This compares to 24.3% in the general community;
- Most culturally diverse directors have North West European cultural origins (10.9%);
- The proportion of business leaders with Asian cultural origins is relatively low compared to the general community, especially given the importance of the Asian region to Australia’s future economic growth. Only 1.9% of executive managers and 4.15% of directors have Asian cultural origins (versus 9.6% in the general community);
- On a state basis, NSW, WA and VIC have the highest proportion of culturally diverse directors, QLD has the closest match between leader diversity and community diversity, but NSW has the least alignment between leader diversity and community diversity;
- On an industry basis, the commercial & professional services industry has the highest degree of cultural diversity while the transportation industry and the automobiles & components industry have the lowest; and
- Culturally diverse female and male leaders are on par with 22.0% of female directorships culturally diverse and 20.4% of male directorships. However, there is a very small pool of culturally diverse female leaders: 29 female versus 233 male.
The project is officially endorsed by the Federal Government’s Australian Multicultural Council. The Australian Multicultural Council was launched in August 2011 by former Prime Minister the Hon. Julia Gillard MP. Its establishment was one of the key initiatives of Australia’s multicultural policy, The People of Australia, which was announced in February 2011. Its mission is to act as an independent champion of a multicultural Australia and to advise the Australian government on multicultural affairs policy. The ten-member Council is a key partner in the National Anti-Racism Partnership and Strategy and will have a formal role in a strengthened Access and Equity strategy. The Council has also prioritised work on productive diversity, increasing the capacity of Australian industry to capitalise on the benefits diversity brings.