In Canada, despite the fact that Visible Minorities make up 21.9% of the population (much more in some cities) the representation of people from “diverse” backgrounds (as well as female representation) is still abysmal.
Bill C-25 (currently before the Senate) is aimed at changing that. It would require publicly traded companies to report on diversity (the number of women and visible minorities – on boards and in senior management, along with their diversity policies. Failure to do so would require an explanation to shareholders.
The Current Lay of the Land
Ryerson’s DiversityLeads report (2015) states in Montreal, Visible Minorities make up 20.3% of the population and 4.8% of Senior Leadership positions. Statistics for women are much better, but still not representative: 51.3% of the population is female, and women hold only 37.5% of Senior Leadership positions. A new DiversityLeads report is scheduled to be released soon.
So what would Bill C-25 do?
It would create greater transparency. It would hold companies accountable to their stakeholders. And in so doing, it would help to reduce the gap between population and representation. But more than that, we know that diversity (when coupled with inclusion) leads to innovation and greater reach – which translates to dollars. The Toronto Star article quotes Catalyst Canada: “Companies with three or more women directors in at least four of five years significantly outperformed those with sustained low representation by an astonishing 84% on return on sales, 60% on return on invested capital and 46% on return on equity.
This should come as no surprise. Diverse representation in an inclusive environment means new ideas, perspectives and markets. It doesn’t come without challenges, but when leadership has a D&I mindset, these are outweighed by the benefits.
But despite the known and documented benefits of increased representation at all levels, companies remain slow to increase their diversity, and slower to adopt practices and policies that support inclusion. Bill C-25 will help – because as we know, “what gets measured, gets done.”