Why Inclusive Leadership Is Good For Business

Unless you’ve been living under a rock for the last decade, you’ll have heard the term ‘diversity and inclusion (D&I)’ quite a lot. D&I has become an HR buzzword in recent years and for good reason. McKinsey research has shown gender diverse teams are 21% more likely to outperform others. At the same time, those rich in ethnic diversity are 33% more successful.

D&I education isn’t an emerging field; it’s been around since the mid-1980s. In the wake of significant political and social changes, D&I has only recently received the widespread media attention and organisational support it deserves.

Yet progress in the majority of sectors remains limited. Programs and initiatives designed to increase diversity and inclusion in the workplace often fail. So this leads to one natural question: What can you do to create a more diverse and inclusive environment? While there’s no single solution or one-size-fits-all approach, it’s about understanding where the change can happen – and well, it all starts from the top.


As Verna Myers famously said: “Diversity is being invited to the party; inclusion is being asked to dance.”

Diversity and inclusion are seen as two separate concepts with equal significance. While diversity is about differences in people, like age, sex, race, ethnicity, religion, disability etc. Inclusion is about bringing those differences together and empowering them to work collaboratively.

However, the definition of ‘inclusion’ is often up for debate, which makes it difficult to evaluate progress and for leaders to be held accountable. Many perceive inclusive behaviour as ‘tokenistic’ in nature, where the focus is on giving the appearance of diversity rather than embodying it. So it’s important to recognise that inclusion extends beyond diversity quotas, tick boxes and affirmative action.

If we were to look at a more holistic definition, it’s about people feeling as though their authentic self is valued. The term brings about a sense of belonging and connectedness, where everyone is welcome regardless of their differences.


Leadership, albeit authentic or authoritarian, has been around since humans first started interacting. However, the values and capabilities of leaders have developed significantly in tandem with the diversity of talent, customers, markets and ideas. Of course, there are aspects of traditional leadership that are still relevant to today’s context, such as directing and influencing others, but an adjustment is needed for predominantly homogeneous companies or teams.

Businesses nowadays rely on diverse, multidisciplinary teams that leverage the collective capabilities of all genders, all ages and different cultural backgrounds. But merely having that mix of people isn’t enough to guarantee high performance; to make all those voices sing it requires inclusive leadership. This style of leadership ensures all members feel valued and respected, that their uniqueness is celebrated and inspired by others.


A recent Deloitte study highlighted six signature traits of an inclusive leader. Each trait is powerful in its own right, but works best when they feed into one another:

Commitment: Inclusive leaders articulate their commitment to D&I and ensure it’s in line with their own personal values.
Courage: Inclusive leaders are humble by nature, yet not afraid to challenge the status quo. They are willing to admit mistakes and create a safe space for others to contribute.
Aware of bias: Inclusive leaders are aware of personal and organisational blind spots. They continuously self-regulate and work hard to ensure “fair play”.
Curious: Inclusive leaders are open-minded and deeply curious about others. They exercise empathy to understand other world views and experiences while listening without judgement.
Culturally intelligent: Inclusive leaders are attentive to other cultures and are effective in cross-cultural interactions.
Collaborative: Inclusive leaders empower others to leverage and embrace diverse thinking. They focus on team cohesion and encourage collaboration between groups.
It’s clear to see these traits require more than simply paying the idea lip service. It’s about truly embodying what it means to be an inclusive leader and understanding the level of self-reflection and action that’s required.

American research professor – Brené Brown, delves deeper to say leaders are responsible for creating a psychologically safe environment where people feel “safe” to speak up without any fear of retaliation or embarrassment. That way employees are supported and empowered to bring their most authentic selves to work.

Having a trust-based relationship is the foundation upon which inclusive leaders can foster a psychologically safe environment for their teams. Leaders must also learn to adapt and respond to different environments to suit the needs of diverse talent, consumers and markets.


Having diversity in leadership is key. In fact, a recent report by the Bankwest Curtin Economics Centre (BCEC) and the Workplace Gender Equality Agency (WGEA) found female top-tier managers add a huge 6.6% market value to ASX companies, translating to AUD$104.7 million!

As Deloitte argues, D&I is important for a number of reasons. Firstly, it creates a stronger and more inclusive narrative about diversity, one where people feel valued and part of a shared goal. Secondly, it reflects our intersectional complexity as humans, rather than focusing on one specific group or demographic.

Research has found what leaders say and do can make a 70% difference as to whether an employee feels valued and included. The more people feel included, the more likely they are to put in the extra mileage to perform and collaborate with their teams – all of which ultimately enhances your company’s bottom line results.

There are several reasons why D&I is important in leadership. Let’s explore some of these in more detail –


Inclusive leaders, in particular those who are cognitively diverse, play a key role in minimising groupthink and unproductive conflict. They achieve this by bringing together divergent teams that are optimised for creative and innovative thinking.

You can’t ignore the stats. Research shows diversity of thought can lead to a 20% increase in creativity and innovation. Not to mention it can help your business reduce risk by up to 30%. ‘How’ might you ask? Well high-performing teams are those that are both cognitively and demographically diverse.

Unique demographic and cognitive differences can be used to encourage out-of-the-box thinking and spot risks others might not have seen otherwise. It’s ultimately down to leaders to create that kind of environment where people feel comfortable challenging the status quo.

The more diverse the team, the more important it is to have a supportive leader who can leverage each person’s unique differences and ensure their voices are heard. Their role is to articulate the “why” and supply dynamic frameworks, guidelines and toolkits that facilitate greater collaboration and diversity of thought.


To bring about change, it’s vital you have your people on board – from senior managers through to your employees. Inclusive leaders recognise how mindsets can serve as barriers to change and that different people view change through various perspectives. Inclusive leaders are capable of reaching out and listening to people’s questions and concerns.

By doing so they are able to provide context and greater understanding as to why changes are being made and how they are important. Simply filling in the blanks ensures everyone feels comfortable with the change and that it is reflective of their own personal values.


Being a leader is no walk in the park and, like any person, leaders are capable of making mistakes. It’s how a leader receives feedback from others and learns from their mistakes which distinguish the good from the bad.

Inclusive leaders recognise the importance of reaching out to their network and teams to ensure they’re on the right track. They’re not afraid to step out of their comfort zone and admit their weaknesses. By doing so, inclusive leaders can inspire others to do the same and build a more psychologically safe environment.



Inclusive leadership needs to be highlighted as a core pillar within a company’s D&I strategy. It’s about crafting a narrative as to why this style of leadership is crucial to business performance and success. D&I must become a core company value that is woven into the DNA of a brand. Publicly committing to D&I can help ensure all members of your business feel valued, seen and heard. Performance goals or KPIs should also reflect the importance of diversity in crafting new ideas, products, services or processes.

Change needs to be driven from the top. While senior executives are where it should start, the middle manager cohort is equally important. Ensure those who are trained and appointed senior or mid-level management positions embody inclusive leadership and are committed to building a highly supportive workplace culture.

It’s also essential to consider how inclusive leadership fits within the scope of an organisation’s innovation strategy. In other words, do your leaders assemble teams that are diverse in nature and dedicated to quashing group biases when brainstorming, ideating or solving problems?


Inclusive leaders must continuously ask themselves if they’re building an environment that encourages and supports diverse groups of people in contributing their ideas. By having their voices heard, it can translate into meaningful organisational performance that provides inspiration and value to others in the diversity talent pipeline.

If leaders only allow contributions from people who think, look and sound alike, regardless of how intelligent they are, then their solutions will lack the innovative thinking diverse thought provides.
Finding new and exciting solutions depends on collective difference. This not only benefits the organisation but also helps to improve employee engagement, productivity, retention and performance.

Start by encouraging different ideas, viewpoints and opinions during team meetings by incorporating them into the meeting agenda. This can be done using interactive technologies like gamification to get the whole team on board. Creating a fun and engaging environment is a surefire way to make your employees feel comfortable speaking their mind.


How can leaders walk the talk? Well, one tactic is to form a personal advisory board (PAB) – a team of people, often influential figures or peers, who serve as trusted advisers to a leader. They’re responsible for providing direct feedback on everyday behaviours and actions that either build or inhibit D&I in the workplace.

Leaders must consider selecting people within their network who have a specific diverse set of skills that can provide feedback from all angles. The beauty is that a strong and diverse PAD can assess whether any changes or initiatives are hitting the mark, and assist leaders in making adjustments where necessary. For example: does the leader use inclusive language in day-to-day operations? Do they provide equal air-time to all meeting participants?


Without strong leadership, employees will most likely do the bare minimum to fulfil their role requirements. Not to mention, a lack of D&I in the workplace can create a dangerously homogenous or toxic work culture with low levels of engagement and retention. The last thing any business wants is to see their top talent walking out the door, into the welcoming arms of their competitors!

With the diversity of talent, customers, markets and ideas driving the need for inclusive leadership, it’s time business leaders learnt how to build these unique capabilities. The goal of inclusive leadership is to bring about change and innovation while balancing the needs of those around them. It’s about breaking down those barriers to entry for people who are most at risk of being excluded.

Emma Jones is the Founder and CEO of Project F,
helping progressive companies achieve gender-balanced technology teams and leadership.

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Further reading

How to build a genuinely diverse and inclusive tech workforce without underestimating women’s abilities and potential.
By prioritizing Diversity and Inclusion, startups can tap into a multitude of benefits that will propel their success. Let’s explore.
Uncover the differences between traditional and progressive HR and how the latter is essential to build diversity and inclusion in the tech industry, especially on the verge of the fifth revolution.