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Let’s Capitalise on Australia’s Cultural Diversity

6 May 2013 at 1:36 pm
Staff Reporter
Australia needs to provide greater leadership opportunities for people from culturally and linguistically diverse backgrounds and we will reap the rewards, says Nareen Young, from the Diversity Council Australia and writer, Jieh-Yung Lo.

Staff Reporter | 6 May 2013 at 1:36 pm


Let’s Capitalise on Australia’s Cultural Diversity
6 May 2013 at 1:36 pm

Australia needs to provide greater leadership opportunities for people from culturally and linguistically diverse backgrounds and we will reap the rewards, says Nareen Young, from the Diversity Council Australia and writer, Jieh-Yung Lo.

In the past few years, the call for greater representation of women in Australia’s institutional and business sectors has garnered much interest in the public and private sectors, with good reason.

In 2012, women constitute about 35 per cent of directors on Commonwealth Government boards, with the Government’s stated aim to move that towards 40 per cent. The figure for the top ASX 200 companies for many years was 8 per cent of women on private sector boards. By the end of 2012, according to the Institute of Company Directors, that number reached 15 per cent.

The announcement in 2011 by the ASX Corporate Governance Council that listed companies were to comply with reporting guidelines for women’s representation had an immediate impact where 25 per cent of new appointments to ASX boards were women, compared to 10 per cent in 2010.

Of course, we agree that 15 per cent is still simply too low.

But what concerns us just as much is that for people from non-English speaking backgrounds, these numbers are even lower. Australia has made some progress in relation to women’s representation, but we have yet to capitalise in the area of cultural diversity.

Australia is arguably one of the world’s most culturally diverse countries. Today, Australians come from more than 200 countries, identify with more than 270 ancestries and speak almost 400 languages. Like the recent focus on gender diversity we need measures and strategies to further encourage greater cultural diversity representation in leadership positions.

What we would like to see is more diversity in politics, business and community life to ensure leadership positions have a more balanced representation. We need to create more awareness on the strategic benefits of embracing cultural diversity talent in organisations.

Realising the full potential of people from non-English speaking backgrounds in leadership positions will create tremendous cultural, educational and social benefits and fully utilise the talent and skills of Australia's well educated and experienced multicultural communities. We definitely have an important role to play to shape leadership and improve opportunities for people from non-English speaking backgrounds.

Sport in the USA has been a shining example of capitalising on talent from culturally diverse backgrounds. In 2012, one of the biggest success stories globally was the rise of professional basketballer Jeremy Lin. A player who wasn’t even drafted by the NBA, rose through the ranks by showcasing his talents and passion for the game and leading his team to a string of memorable victories that captivated sporting fans around the world. Immediately dubbed ‘Linsanity’, Lin became an instant hit with American audiences and inspired young Asian Americans to take up their interests and talent in basketball. Interest in basketball has also grown in Asia through Lin’s exploits since the departure of Chinese player Yao Ming.

According to international research, there are clear economic benefits for cultural diversity. Companies with high executive and board diversity had ROEs an average of 53 per cent higher than those with low levels and EBIT margins 14 per cent higher. Supporting cultural diversity can also deliver considerable cost savings to employers through minimising the costs associated with unnecessary staff absenteeism and reducing avoidable costs associated with turnover, recruitment and re-training.

Diversity Council Australia’s (DCA’s) Capitalising on Culture pilot research in 2011, surveyed cultural diversity in the executive ranks and immediate pipeline in a key part of the professional services sector and ANZ in Australia. This revealed 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.

Businesses and governments need to introduce policies and practices to increase the proportion of senior executives and leaders who originate from non-English speaking backgrounds through developing a talent pool and increasing the depth of cultural diversity knowledge and experience in the immediate leadership pipeline.

Our cultural diversity remains an untapped resource. Individuals with knowledge of another culture and language have the ability to engage businesses to better understand and service the needs of increasingly diverse local and global clients, opening up new networks in international markets and providing advice to attract domestic consumers from all backgrounds.

With 8.8 million consumers in the domestic market either born overseas or having at least one parent born overseas, businesses cannot afford to ignore such as critical mass of consumers.

DCA intends to conduct its Capitalising on Culture research on a wider group of ASX-listed companies in 2013. Sponsored by PwC and the Department of Immigration Citizenship (and supported by IBM) and endorsed by the Australian Government’s Australian Multicultural Council, the survey results will identify and make it easier for businesses to know how to leverage cultural diversity.

And in the ‘gender diversity’ context, we don’t often see or hear much about diversity among and within Australian women. There are plenty of women out there from culturally diverse Australian backgrounds who have skills and experience that are entirely untapped in the broad community leadership context.

With Australia becoming more culturally diverse, we cannot afford to ignore our growing talent pool. Businesses and governments need to embrace the new generation of diversity thinking and develop understanding on the needs and expectations of an ever changing society and community.

With so much talk about Australia embracing the Asian Century, we have the resources and talent to do just that at our doorstep. We just need to let them in and give them an opportunity.

About the Authors: Nareen Young is the Chief Executive Officer of Diversity Council Australia. Jieh-Yung Lo is a writer and Associate Producer of the upcoming documentary film New Gold Mountain – Your Chinese Australia.

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