The Sunday Mail
Taurai Changwa Business Forum
SUCCESSFUL businesses usually have a very competent board underpinning their performance. Such boards support the CEO in general and the management in particular to move forward. But the importance of diversity in any given organisation cannot be overemphasised. Diversisty describes the range of visible and non-visible differences that exist among people.
The key ingredient to success remains combining each of their distinct capabilities and skills into a workable force that the company can use to its advantage. Equally, managing diversity involves harnessing these differences to create a productive environment in which everybody feels valued, talents are fully used and organisational goals are met.
The concept of diversity encompasses acceptance and respect. It means understanding that each individual is unique, including recognising individual differences. Differences can manifest themselves through race, ethnicity, gender, socio-economic status, age, physical ability, religious beliefs, political beliefs or ideological orientation.
Generally, boards are comprised of high-profile former executives and corporate leaders with extensive experience in general management and risk. The inclusion of people that do not have any experience in any speficic area, as is the case with some local companies, is suicidal. Morden corporate boards have a variety of skills and experience among directors in order to move a company toward its long-term goals.
Discrimination is counter-productive and poisonous in any business environment. Most successful companies, especially those that are listed on the Zimbabwe Stock Exchange, have well-configured boards through a rich balance of race, gender and ethnicity.
It can be argued that this is the reason they are successful.
Companies that lack diversity sorely miss valuable contributions that a different group of people brings to the table. Boards that are too “cultural” can be oblivious of market trends or internal problems.
Though it is vitally important building a diverse board isn’t easy at all. Diversity brings with it new thinking, insights and perspective. It is unfortunate that there are some people who think that bringing in different ideologies cannot possibly work in the best interests of the company.
In as much as diversity entails bringing together different interest groups, it helps reduce excessive risk taking. Anyone can make a difference in organisations they serve. Remember, former United States president Franklin Roosevelt had polio. He was governor of New York before he was elected president four times.
Differences in view points will always exist but a culture that invites and encourages open, honest feedback and independent opinions in the board is always invaluable.
Ms Juliet de Baubigny, a senior partner at venture capital firm Kleiner Perkins in Silicon Valley, said, “It’s important that boards — which tend to reach for what’s familiar and comfortable – strive for diversity of opinion and push a company’s leadership by challenging conventional wisdom.”
What, however, needs to be emphasised is the need to select board members on merit and competence.
Appointing clueless individuals in the name of diversity also makes absolutely no sense.
People need to do the hard work of looking for qualified and competent individuals within the interest groups highlighted earlier.
Jack Ma, the Chinese bilionaire, once indicated the need for different age groups to work together in organisations. This, again, proves that diverse teams are more efficient.
If people are united by the same thinking and ideology, it is undoubted that they are likely to sink together. Having people who challenge/oppose decisions within the board can be healthy for an organisation.
A “Yes-Man” is dangerous. So, too, are weak men.
As Charles Dickens said, “In a word, I was too cowardly to do what I knew to be right, as I had been too cowardly to avoid doing what I knew to be wrong.”
Companies need to review the way they do business, especially in the way they set up their boards as this can directly impact on how effective the company is in competing on the market.
Failure in some companies can be traced to ineffective boards.
It is the responsibility of people who have the interests of the company at heart to ensure that the organisation functions efficiently and effictively.
And proper companies have to learn the correct way to do business. Our future depends on this.
Taurai Changwa has vast experience in tax, accounting, audit and corporate governance issues. He is MD of SAFIC Consultancy and writes in his personal capacity. Feedback: [email protected], Facebook page SAFIC Consultancy or WhatsApp on +263772374784