Thursday, January 24, 2008

Cultural Diversity: A World of Difference

The European Union has declared 2008 the year of intercultural dialogue, so what better time for companies to turn diversity into a business opportunity?

Written by Dr Atul K Shah

Professional bodies are a magnet for minorities of all kinds ­ they provide a way for them to break the class barrier and maximise their skills and potential. In the UK, the accountancy profession attracts the largest number of ethnic minority applicants compared to any other profession. Look at any list of prize winners, and minorities ­ ethnic Indians, Chinese, Africans and others will often be there.

Although actual statistics of membership are not available, anecdotal evidence suggests that at least 40% of the members are non-white. That is a staggering statistic. China, India, Kenya, South Africa, Nigeria, Germany, France, Brazil, Canada, USA ­ and countries from all over the world have sent their ambassadors to the UK ­ to practice accountancy. Every country in the world is represented in the UK profession ­ and that is a staggering accomplishment.

Either working in the profession or in industry, these members are making a huge contribution to the UK economy. There is diversity in the range of involvement and careers pursued. Many of these people are playing critical roles in the globalisation of British enterprise. British diversity has boosted the bottom line of corporations and professional firms for decades.

Plenty to offer

What exactly is it that immigrants bring to British enterprise? Different languages and cultural sensitivities for a start. International contacts and a flexibility of approach and hospitality gives them a leading edge. Hard work and diligence are a given ­ they have had to work very hard to get where they are and are keen to push the ceilings. Also they came with zero so the only way they can go is up.

For many immigrants, risk, enterprise and commerce is in their DNA. This applies particularly to Indians whose membership of the profession is in the tens of thousands. Their success has been proven by their thriving businesses ­ with many in the British Rich List. Their extensive community ties and networks provide them with huge social capital. The next generation has now been born and raised in Britain and having educated parents has made them even stronger.

At a time when countries like India and China are on the rise, people from these cultures with an accounting qualification provide an added bonus for effective international commerce. In professional practice, there is a disproportionately large number who have set up their own practices which are dynamic and growing. This is partly a result of discrimination and lack of opportunity within mainstream firms. They are a primary engine of small business growth in this country and many an entrepreneur would vouch for that.

The law on diversity in employment and services has changed significantly in recent years. It is illegal for firms to discriminate in their employment practices both at time of recruitment, progression and promotion. The consequences of breaking the law are serious in terms of time, embarrassment and cost. Many large firms have set up diversity units which spearhead employee training and ensure equality of opportunity at all levels.

Special employee networks have been established such as the Ernst & Young South Asian Network and the Price Waterhouse Hindu Network. There are also networks for women, gay people, disabled people and other minorities. However, the research evidence suggests that there is still a glass ceiling for minorities of all kinds. The same applies to industry and here again, if we look at the FTSE 100 companies, colour and gender is virtually absent among the board members.

However, there are positive ways of dealing with difference and turning it into an advantage. Human resource departments in firms hold the key to unlocking diversity and enabling change through recruitment, training and progression. Often problems lie in the very middle of large organisations ­ and the top stays mono-cultural as a result.

For teams to be creative, diversity helps in providing different ways of thinking and approaching a problem. Genuine open-mindedness enables learning and growth and avoids marginalisation of any colleague, irrespective of their background.

Studies have shown the huge losses companies incur through employee turnover, and this can be avoided if the right policies and practices are implemented. Empowerment of team members promotes respect and loyalty rather than fear and repression.

A recent study by Vodafone showed that many employees suffer from ‘identity stress’ ­ they feel they have to switch identities between home and the workplace. I like to encourage companies to embrace difference and see difference as an opportunity for growth and prosperity.

Treating employees ‘holistically’, where they are allowed to be themselves, creates loyalty and trust which are critical to lasting success. Mentoring and role models enable minorities to aim high and have hope and aspiration.

Organisational cultures need to change and this requires serious commitment from the senior staff. No longer can these matters be brushed under the carpet.

Professional bodies have to be careful in ensuring their services are accessible to all and that they take account of the needs of minorities and ensure their full participation in the association. Here again, there is a huge challenge as diversity is in policy statements but not observed in practice.

In reality, diversity in the workforce increases creativity and helps tap into new markets nationally and internationally. Organisations who ignore this are losing out.

How to make the most of it

• Difference is an opportunity, not a threat
• Organisations need to treat their employees ‘holistically’– as wholes and not parts
• Open-mindedness needs to be nurtured and encouraged
• Empowerment rather than territorialism will create loyalty and build trust
• Research has shown many employees suffer from identity stress
• Diversity helps creativity and enable firms to develop new products and access new markets
• A diverse workforce helps with global trade and commerce


About the Author

Dr Atul K Shah is chief executive of Diverse Ethics Ltd.

Source : Accountancy Age

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