Five Ways CEOs Can Model Inclusiveness

In mid-June 2020, Google Inc. CEO Sundar Pichai announced a corporate initiative aimed at increasing “leadership representation of underrepresented groups” by 30 percent by 2025. The announcement came as many other high profile companies, including Carlyle Group, Nike and JP Morgan, made similar moves to reconcile a historical pattern of past inequalities with a genuine effort to increase diversity in management ranks.

The implementation of inclusiveness initiatives is supported by a prolific and growing body of evidence showing significant benefits to the organization and the team. Research group Catalyst recently summarized findings from dozens of sources and concluded recruitment, maximizing talent, productivity, innovation, decision-making, team performance and ethical behavior are all benefits linked to an organization with greater inclusion.

Inclusive organizations also experience bottom-line benefits. A just-released study from management consulting firm McKinsey shows ethnically- and culturally-diverse companies are 36 percent more likely to be profitable than the least diverse companies. The study goes on to say, “there is a widening (financial) gap between leaders and companies that have yet to embrace diversity and their more inclusive competitors.”

Evidence in favor of inclusiveness and diversity is indisputable. The challenge for CEOs is how to best move forward in promoting the practice in a board setting and among the executive team. Here are five ways CEOs can model inclusiveness:

1. Teach collaborative inclusiveness. In classrooms, The Center of Innovative Teaching at Cornell University promotes collaborative learning approaches to achieve higher-level thinking, oral communication, self-management and leadership skills. Similarly, in corporate settings inclusive learning models leverage skills, knowledge, expertise and needs that otherwise would remain undiscovered. CEOs should seize the opportunity to introduce collaborative models that address the complexities of class and race and make it standard operating procedure.

2. Encourage discussions about inclusiveness. Especially when facing uncertain and complex challenges, CEOs who engage in inclusive communication open new ways of thinking and resource sharing that help the participants reach individual goals that benefit the organization. Travis Motaque, CEO and founder of technology firm Holler, has made it a priority “to facilitate ongoing discussions about what equality means.” His approach encourages opportunities for communication between departments, seniority levels and colleagues in order to maximize the enormous competitive advantage from a diverse workforce. CEOs should introduce and lean in on conversations about inclusiveness.

3. Root out and address exclusionary behavior. CEOs should promote the concept and value of inclusiveness and, at the same time, root out exclusionary behavior. I recall, in a past boardroom setting, executives were intensely discussing an important matter. The CEO noticed one of the members sitting silently with his arms crossed. The CEO paused to call on him for his observations. By taking the time to foster an open environment and make sure he had a chance to offer his perspective, the outsider became an insider. He ended up being a key player and identified a solution to the problem at hand.

4. Eradicate office politics. Similar to exclusionary behavior, power plays in a work environment are poison to inclusiveness. In an environment in which executives engage in manipulative behaviors to advance personal gain (in the place of hard work), other workers go into shutdown or survival mode. Professionals from diverse backgrounds are even more likely to retreat than to “play the game.” At all costs, CEOs must extinguish office politics, which is often disguised racism, by shutting down backhanded comments and sugar-coated hostility.

5. Establish a reputation mindset. According to the Catalyst study, organizations with inclusive business cultures and practices are 58 percent more likely to improve their reputations. There are countless examples of how “bad boy” reputations tanked stock prices and caused mass exodus of employees. CEOs should express their personal framework of right and wrong because reputation is directly linked to ethical behavior. With an ethical CEO, an inclusive board will advocate on behalf of the company and reputation soars.

Like the time-honored principle of compounding interest, encouraging inclusiveness and diversity can produce miraculous dividends. In our Presidential and Key Executive (PKE) MBA program, I have seen time and time again how CEOs focus on fixing one circumstance and others become easier. As a small amount of money can grow into a large amount of cash, so too can a small amount of trust grow into a performance bonanza. When world class companies increasingly seek to enhance inclusiveness, world class CEOs will be instrumental in putting the principles into practice.