Blog: To field our best team we need a more diverse squad
Blog by Susan Murray, the David Hume Institute
6th September 2021
Image credit: Photo by Sandro Schuh free from Unsplash 06.09.2021.
As the football transfer deadline day passed last week, many teams made key appointments to their squads. Player’s data and match statistics underpinned transfer decisions. It’s no different in business: data matters and should affect the choices being made.
However, new data from the David Hume Institute shows that business leaders are limiting Scotland’s potential by not prioritising diversity in their top decision makers. Diversity of thought increases resilience, productivity and innovation as well as improving risk management. Scotland’s top team is missing out.
The research investigated investment and angel investment leaders in Scotland. Scotland’s investment companies have less diversity at the top than companies elsewhere in the UK. Although angel investment leaders are more diverse than the bigger companies.
The data on who is, and isn’t securing business investment and who can access the resources to grow is shocking - and again, limiting potential.
The data shows those with resources and connections are more able to reach the top. This limits the pool of top decision makers and risks group-think - a risk Scotland should be aware of after the last financial crisis.
Business and investment leaders lag behind other sectors, and are not responding to the data linking diversity of thought with successful outcomes.
So why isn’t change happening faster?
Studies from around the world show overt and covert bias is limiting the pool - so this is a great opportunity. Awareness is the first step - just like players on a football pitch, knowing your own statistics helps improvement. Leaders have the power to champion and deliver change in Scotland.
Three out of ten of the top 50 business leaders also hold positions on other boards, meaning they can influence change beyond their own companies. Similarly, the power to decide who gets investment is in the hands of the investment leaders.
Why does this matter? Improving gender diversity alone could add up to £250 billion of new value to the UK economy, if women’s new businesses were invested in and scaled up at the same rate as men’s. If women’s participation rates matched men’s there would be the potential of c.35,000 more direct jobs in the Scottish economy.
The leaders have the power to bring change. The country has big challenges ahead and leaders need to rise to those challenges. Scotland needs its top team on the pitch.
The IOD conference last week challenged Scotland’s Directors to think about the IPCC code red: “the costs of inaction on climate change are greater than the cost of action. There needs to be a bias towards change rather than a bias against it.”
The same is true of diversity of thought. The benefits are widely known and there are costs to inaction. It's time for Scotland’s top business and investment leaders to bring more breadth to their squad and champion change.
This piece was originally published in The Times on 6th September.
