The benefits of diversity and inclusion

Among many other things, the COVID-19 pandemic has presented the world with a fascinating real-time experiment in leadership. Although countries across the world face diverse underlying issues, the pandemic has illustrated how a vast array of different governments have sought to respond to the same problem.

An interesting observation has been the correlation between countries led by women and countries that have kept the crisis under control, says Prabashini Moodley, Managing Director, Old Mutual Corporate. “The relative success of women-led countries – Denmark, Finland, Germany, Iceland, New Zealand, Norway and Taiwan — are cited as evidence that women, who make up only 7% of heads of state around the world, are somehow managing the crisis better than their male counterparts.”

This observation has been discussed by major institutions from Forbes to the World Economic Forum, and from the Harvard Business Review to the Boston Consulting Group. Research from McKinsey & Company suggests that this may be due to women rating better than men in key leadership capabilities such as flexibility, empathy, collaboration, and the ability to prioritise collective contribution — all characteristics, the research notes, of “traditionally feminine management”.

However, says Moodley, concluding that women make better leaders than men is committing what philosophers call the fallacy of the single cause. “This thinking assumes that there is a single, simple cause of an outcome when the outcome may in fact have been caused by a number of jointly sufficient causes,” she says.

In Moodley’s view, it’s not a question of women being better than men at leadership, or vice versa, but rather a matter of empowering diverse perspectives. “Having a diverse leadership culture means encouraging plural perspectives, which is the best way of insulating yourself from the potential dangers of a homogenous set of views. Or as McKinsey & Company put it: ‘The participation of everyone’s intelligence becomes the key to success,’ she says.

Moodley sees the benefits of diversity and inclusion first-hand in her role at Old Mutual, which has been driving diversity and inclusion hard over the past few years, and made it one of its official values. For example, she says, almost 50% of Old Mutual’s fully qualified actuaries are black, compared to the national average of around 20%.

According to the World Economic Forum, countries that scored high on gender parity in the Global Gender Gap Report 2020, measured in terms of the participation of men and women in society and the opportunities available to each gender, fought the pandemic most effectively.

Moodley says the report suggests that in these countries, power is enhanced by the complementary nature of different genders contributing. “Countries that scored high in gender parity and are led by women rank high on the list. The report also shows those same countries rank high when it comes to having women on corporate boards. It, therefore, leads us to conclude that more egalitarian societies are better managed,” she says.

Internal research conducted within the Old Mutual Group has also revealed that diversity and inclusion is a major factor underpinning a culture of ‘psychological safety’ for all employees. Moreover, this is a key component when it comes to innovation. “Diversity, in this context, is not limited to gender or skin colour, but is about approaching challenges holistically by considering the full scope of ideas, expertise, and insights from within an organisation,” says Moodley.

From that perspective, Moodley is adamant that a culture that values diversity will be both more productive during ‘normal’ times and more agile during times of crisis. “It isn’t just about quotas,” Moodley states.

“That would be a massive insult to the very notion of diversity. It is about maintaining a mix of individuals at all levels of an organisation or society, where everyone is empowered to contribute their unique insights to innovate and make the whole stronger. By giving diverse people the authority and mandate to make decisions, organisations will undoubtedly benefit from the richness of diversity within their workforce,” she concludes.

“Everybody is subject to unconscious bias, which can deeply hinder progress. The best antidote to this is to ensure that a spectrum of voices is audible throughout your corporate culture – and having women at the helm is often a good indicator of this.”

Prabashini Moodley, Managing Director, Old Mutual Corporate