Change at the top

Visible minorities make up more than half of Toronto’s population. But you wouldn’t know it if you stepped into corporate boardrooms in this city. There they are almost invisible. Indeed, a new report from Ryerson University’s Diversity Institute points out that visible minorities make up a scant 3.3 per cent of corporate boards.

Put another way, only 3 per cent of companies have 20 per cent racialized minorities on their boards and 90 per cent have none.

Those stark statistics should be a wakeup call to corporate leaders. They are lagging behind profound demographic changes in Canadian society and risk becoming increasingly out of touch with their customers and their staff.

There’s both a moral and a business case for greater diversity at the top. It helps to build stronger communities and inspires young people to aim high. As Donna Walwyn, past president of the Association of Black Lawyers, says, “Diverse representation in leadership signals who belongs and shapes the aspirations of young people.”

The Ryerson study also points to growing evidence about the economic and financial importance of diversity that business leaders would do well to consider.

With a declining birthrate immigration will be the key to replacing a retiring workforce. Companies with diverse boards and leadership are better positioned to attract, retain and develop the best business talent.

They are also better positioned to respond to the needs and aspirations of markets that include more and more people from many backgrounds.

Diverse teams are also more likely to think in creative ways and develop innovative solutions to challenges, offering a competitive advantage.

Happily, there are government efforts in the works to encourage diversity on boards.

The federal government’s Bill C-25, for example, which is currently before the Senate, will require publicly traded corporations to report on diversity data and policies.

That should make a difference. “We know that legislation, tracking and transparency make a difference in encouraging companies to set targets and policies,” says Wendy Cukier, founder of the Diversity Institute.

Corporate leaders would do well to take the message from the Ryerson study to heart. Customer loyalty, staff engagement and social cohesion are all good for business.