Bamboo ceiling

Meritocracy: Robert Yue, vice-president for Australia and New Zealand of SuccessFactors, believes in promotion on merit

The transition from the infamous White Australia policy, whose final vestiges were not abolished until 1973, to the creation of one of the world’s most stable and harmonious multicultural societies, is a remarkable achievement. It has not been a seamless path, but successive waves of immigration from every corner of the globe have irrevocably changed the face of our past largely homogeneous nation. Curiously, despite this astonishing transformation from monocultural outpost to multicultural beacon, the face of corporate Australia remains defiantly Anglo-Celtic. To appreciate the dimensions of this paradox, it pays to reflect on just how much the composition of Australia’s population has changed.

According to the Australian Bureau of Statistics, in June 2010 the proportion of the population born in Asia was 9 per cent, on the heels of European-born residents who accounted for 10.8 per cent of the population. In 1947, just 0.3 per cent of the population was born in Asia, but the ABS expects the number of Asian-born Australians to overtake European-born Australians within three years.

In the decade to 2010, the number of Chinese-born people living in Australia more than doubled to 380,000 (1.7 per cent of the population) from 148,000 and the number of Indian-born residents more than trebled to 340,000 (1.5 per cent) from 96,000.

So why do these communities not have a more visible profile in the leadership and governance of companies?

Nareen Young , chief executive of Diversity Council Australia , has been asking the same question. The council believes it’s time cultural diversity in business was given the same prominence as the push for gender diversity.

But first it needs to find out exactly how companies measure up on cultural and ethnic diversity. The council is about to undertake a study with ANZ Banking Group, accountancy giant Deloitte, financial services firm Goldman Sachs and law firm Mallesons Stephen Jaques on the cultural diversity of the boards of S&P/ASX 200 companies.

Young believes Australian companies fall behind the best practice of their counterparts in the United States and Europe.

“I don’t think the senior echelons of leadership will reflect the community at large,” she says. “We believe that there is a lack of cultural representation [at these companies] but until we have the facts to show it we can’t have a proper discussion about it.”

Young hopes the research, which will be completed in 2012, will lead to “an important debate on the issue in the same way that gender imbalance has been discussed” but believes it is premature to canvass the possibility of quotas for women on boards, which has emerged as a distinct possibility. “I don’t think we can talk about quotas at this stage because we don’t even know what we’ve got out there.”

Young says she is more interested in encouraging companies to adopt best practice in cultural diversity policies and practices.

It does seem curious given the intense focus on “gender diversity” – as one wag commented, “just how many genders are there?” – that the demand for it in the executive suites and boardrooms of listed companies should stop at gender. Young believes there is a simple reason: “Women have been more active on the issue of diversity.”

The head of the diversity practice at executive search firm DHR International , Amanda Bowden , agrees that when she speaks to
clients, “diversity” in companies usually refers
to gender “and to a much lesser extent age, ethnic, disability and sexual preference. “We
are clearly not as far along as the US with company programs for ethnic diversity,” Bowden says.

Margaret Byrne , principal consultant of Sydney management consultant UGM Consulting and a specialist in cultural diversity, is critical of the one-diversity-issue-at-a-time approach.

“Many of the large [activist] bodies and the big organisations have taken a piecemeal approach to diversity – for example, gender, culture or indigenous – rather than looking at diversity in a holistic way,” she says.

Byrne is concerned that, as with the push for more women on company boards, mandatory quotas will be advanced as the solution to the lack of cultural diversity.

Byrne says diversity in organisations is already a given; the issue is how to make the best use of the diversity that exists and understanding the biases – often the hidden or unconscious biases of dominant corporate and leadership cultures – that prevent talented employees from progressing in their careers.

An Asian employee caught between cultures explains the tensions that can arise when there is systemic rather than deliberate bias: “I managed my first couple of years OK but recently I missed out on a promotion, so I asked for some feedback. I was told I needed to show more enthusiasm, be more assertive and push my point more in meetings. I felt I was being told to be someone I’m not.”

Byrne calls this the “bamboo ceiling”, which explains why employees with Asian backgrounds are under-represented in senior management roles despite the outstanding university degrees that made them such attractive graduate recruits in the first place.

She warns that surveying our biggest companies to establish their cultural-diversity profiles will only confirm the obvious; it won’t provide the key to the solution and it certainly shouldn’t be the basis for demanding quotas. “You know already what it’s going to say; it’s not going to be a good result,” Byrne says. “Quotas would be the easy way out because you don’t have to resolve the underlying problems. We don’t have a level playing field. There is a lack of cultural insight and sharing of skills. People need to learn how to work with others who are not like them. That should be the focus, rather than targets.”

The Diversity Council Australia’s Young says diversity’s best friends in Australia are international companies because of their established commitment to the concept and the influence they exert in local markets.

Information technology company IBM Australia – with a US-based parent that employs 430,000 people in 170-plus countries – is considered an exemplar of diversity best practice. It has a diversity council that oversees a multi-pronged program that incorporates women, people with a disability, cross-generational and cultural factors, sexuality and work-life balance.

IBM Australia’s director of human resources, Robert Orth , says the company “looks like the community we operate in”. Orth says the strategy ensures that IBM reflects the needs and values of its customers, enables him to recruit the best people, provides an environment in which “everybody can thrive” and is an important source of innovation – “diversity of thought comes from a diversity of backgrounds”.

One of IBM’s cultural diversity initiatives is the Cultural Diversity Networking Group for Asian-background employees, which has 60 members nationally, from backgrounds including south- east Asian nations, China and India.

Technical solutions manager Ingrid van Uden , who was born here with an Indonesian-Chinese heritage, is the group’s leader. She says the group aims to create greater awareness of Asian cultures as well as provide members with professional development and networking opportunities.

“Whether you’re first, second or third generation, you come with something from your background, even though you’re an Aussie,” says Sydney-based van Uden, who joined IBM as a business graduate in 2000. “My passion is creating awareness of Asian culture.”

Initiatives to spring from the group include a mentoring program and a “floating cultural holiday” program, which allows employees to swap designated public holidays for holidays of personal cultural significance.

The group has also become a valuable training and information resource for Asian and non-Asian staff that do business with Asia or manage remote teams in the region.

Orth says starting the program has been rewarding for the individuals involved and IBM in ways not originally envisaged.

“I would encourage other companies to think beyond the square on the issue of diversity – if you really let go, you’d be surprised where it takes you.”

Such a broad approach to diversity in business, anecdotally at least, would seem not to be the norm in Australia. Most listed companies are focused on lifting the representation of women on their boards – because the Australian Securities Exchange is watching.

Since 2010, the Australian Securities Exchange has required listed companies to report annually on the gender composition at board and senior management level, which has been credited with increasing the proportion of women on S&P/ASX 200 boards from 8.3 per cent in 2010 to 12.9 per cent in August.

Even so, companies are still under fire for being too slow and calls for mandatory quotas persist. But is this single-minded emphasis on gender diversity overshadowing the equally important quest in a multicultural society for cultural and ethnic diversity?

“Sometimes it does,” says cultural anthropologist and author Barbara West , a founding partner of Melbourne consulting firm Culture Works and a director of gender diversity advocacy group The 100% Project .

“Gender is the flavour of the day in corporate Australia.”

West stresses that The 100% Project considers its mission of achieving more women in corporate leadership a cultural issue – dependent on changing “cultural constructs” of gender and concepts of family and work responsibilities. “What we’re trying to achieve is cultural change,” she says.

Its approach includes involving men as key partners in the cultural shifts it desires. Accordingly, it wants organisations to “fully realise the leadership potential of both women and men”.

Although less ideologically strident than some gender lobby groups, The 100% Project is subject to the same single-mindedness.

“We can’t be all things to all people; we’ve targeted this one piece of the diversity jigsaw,” she says.

So, despite its sensitivity to the issue of diversity, the group’s 10-person board, while including two men, is exclusively European.

“I’ve raised it so many times,” she sighs. “Almost everybody on the board has blue eyes – but it’s not an issue we’ve been ignoring.

“We must have men involved in this conversation: so if we have an opportunity to appoint a woman of Indian background or a man to the board – what do we do?”

Robert Yue , the vice-president for Australia and New Zealand of US-based business software company SuccessFactors , was born in Melbourne of Chinese immigrant parents. The affable executive has enjoyed a successful career in the competitive information technology industry and is a former general manager of Hewlett-Packard Australia. But it causes him disquiet that “I don’t see a lot of Asian people on the boards of our major Australian companies”. However, while he believes that companies should “do more to leverage the resources they have”, he is not a fan of quotas.

He believes the key to a culturally diverse organisation is to appoint and promote on merit.

“At SuccessFactors we have a big push on meritocracy – regardless of race, regardless of gender, everyone is given an equal opportunity,” he says.

“If you evaluate people on performance, skills and experience, if you allow as an organisation for that culture to come through so that everyone understands and believes it, that’s a much more transparent way to work on diversity.”

BRW

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