Workforce diversity isn’t just about adding women. Boards need to make sure their current employment strategies have an Asia focus too, according to a national strategy developed by the Asialink taskforce at the University of Melbourne.
In the 1950s, Asia’s share of the world output was around 20%. In 2010 it was 40%. Despite the growth hiccup that the region is currently experiencing, there is no doubt that Asia will feature heavily in the globe’s and Australia’s future.
One of the things that could hinder the growth of trade in this area is the lack of Asian-savvy talent in Australian companies, especially at the Board and senior executive level. The taskforce identified six key capabilities for individuals that it considered as being critical to business success in and with Asia:
- Sophisticated knowledge of Asian markets/environments (business, cultural, political, ethical, regulatory)
- Extensive experience operating in Asia (Over two years in diverse Asian markets)
- Possession and ability to maintain and develop Asian networks
- Ability to adapt to Asian culture
- Capacity to deal with government
- A useful level of language proficiency
Without this kind of Asian know-how at a senior level, advocacy will be weak for creating Asian-capable employees and strategies that will allow Australia to capture the benefits of Asian growth.
The taskforce recommended that Boards recruit Asia-based Australian university alumni into Board and executive positions, introduce just-in-time cultural classes for senior executives and directors, promote and provide incentives to Asia-capable employees, enable employees to spend time working in Asia through study tours or new markets and invest in Asian language training.
Egan Associates sees the importance of diversity and Asian competence, but believes that Boards will have to prioritise this skill set alongside others on their already full wish lists. For example, a recent survey by the Financial Reporting Council highlighted how important it is that directors maintain the currency of their financial knowledge, so they can confidently sign off on accounts. The 2012 Board of Directors Global Survey (PDF) compiled by WomenCorporateDirectors, Heidrick and Struggles and the Harvard Business School, found that directors thought Boards were lacking in various areas of expertise, including technology, sales and marketing, succession planning, risk management, industry knowledge and HR and talent management.
What is critical to one company will not necessarily be so for another. For this reason, it is important to know the company’s strategy and the skills the company requires to achieve this strategy. Tools exist to help Boards map out these requirements. Scenario Planning can help outline alternate future competitive situations in which companies will find themselves. Board Evaluations and Board Capability Assessments pinpoint how Boards and their members can develop both the existing membership and plan for renewal to fulfil those skill requirements.
However Boards decide to tackle their skill requirements, it is crucial they get the right mix of capabilities to drive their company forward.