(*The writer is a best-selling author and corporate advisor. His latest book is titled “Wisdom for startups from grownups”. He was Director of Tata Sons and Vice Chairman of Hindustan Unilever).
If company boards or citizens of a nation do not welcome variation, their eventual homogeneity can pose an existential threat. This can be asserted through both corporate experience and history.
In April 2020, Ms Abigail Disney, granddaughter of the legendary Walt Disney, chided the Disney board for reducing the pay of workers while protecting executive pay by saying, “Pay the people who make the magic happen—with respect and dignity.” In March 2021, McKinsey published a report that stated that Hollywood could increase its revenues by $ 10 billion each year if only it would promote more diversity.
I write on diversity with an emphasis on board gender diversity. Boards tend to favor the creation and perpetuation of a homogenous whole. Nominations Committees seek a director “who will fit in.” Through the existing practice, diversity becomes a casualty—by gender, linguistic group, or nationality because diversity means a person who is not like the others.
While there are evolutionary and social factors, I was unaware that there is also a neuro-psychological factor. Psychologist and neuroscientist, Dr Lisa Feldman Barrett, recently wrote in The Guardian that variation places an additional burden on the brain’s neurons by demanding more resources.
Another learning from Dr Barrett is that the principal function of the brain is not to think or to learn new things, but to monitor and keep all the systems of the body working! To do this, the brain tracks resources like glucose, salt and water through a process called allostasis. When confronted with unexpected experiences, the allostasis of the brain alters. The brain discomfort increases further if there is a tense environment, as may happen at a board meeting. The brain and the body do adjust, but discomfort is inevitable as a metabolic response.
Although the brain resists variation, in contrast, variation is at the core of evolution and life forms. Embracing differences is vital for success as a species. Charles Darwin and survival of the fittest confirm that variation is essential, not just desirable, because without variation, a species would become extinct. If company boards or citizens of a nation do not welcome variation, their eventual homogeneity can pose an existential threat. This can be seen through corporate experience and history.
A 2015 McKinsey report stated that companies with more diverse workforces performed better financially. More diversity means more perspectives, thus enriching the organizational responses to unexpected crises and events. I experienced this when I was Chairman, Unilever Arabia, working with sixteen nationalities. Indeed, the energy and vigor of Unilever globally owes a lot to employee diversity. Suresh Narayan, Chairman of Nestle India, recounts how at the peak of the Maggi noodles crisis, his HR head said, “You are doing dipstick opinion surveys and talking to government, how about engaging with our own employees?” Suresh Narayan credits his large and diverse employee base for several ideas.
History too adduces to this fact. The Ottoman empire was dominated by Turks but also included Arabs, Kurds, Greeks, Armenians, and encouraged Christians, Jews, and other religions. The Ming dynasty in China witnessed cultural and economic ties with many nations. Calicut residents can regale you with stories about how Ming ships arrived there, leaving behind to this day a Silk Street. The Mughal empire was characterized by diversity. Cultural diffusion and acceptance became the hallmark of the early Mughals.
For India, diversity must surely be a competitive advantage. So many religions have co-existed harmoniously for centuries. You find Changthang nomads, Animist Santhals, Husseini Brahmins, Black Siddi Kannadigas, Bene Israeli Maharashtrians, Zoroastrian Parsis, all intermingling. In short, diversity is in India’s DNA, diversity powers India’s survival and growth.
For corporate boards, diversity is a strategic advantage. To adapt from a quote of Gandhiji, “I do not want my boards to be walled in on all sides…. As soon as we differ from somebody, instead of meeting and understanding him, we ignore him or take him to task publicly.”
Dr Barrett makes a recommendation on how we can fight the feeling of the “other.” Meet, talk and reflect deeply about why an opposite view is held by someone you regard well. Disentangling their logic from the emotion, you will appreciate their logic even if you do not agree with it. This aligns with my experience with Mumbai’s clubs and building co-operative societies–which sometimes appear like a unique group of non-cooperative people! I find that this approach works. On a larger canvas, it could do wonders!