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Seminar summary: “Building sustainable organizations – The role of diversity in sustainable decision–making”

How can diversity help build sustainable organizations? That was one question raised at a seminar arranged by Stockholm School of Economics in cooperation with PAUSE Foundation on November 11. The seminar triggered uneasy reflection and caused many of us to revisit our personal opinions.

Two SSE students who have received PAUSE Foundation scholarships to the Global Village for Future Leaders presented their research. In a presentation titled “If Lehman brothers had been Lehman sisters,” Alexandra Johansen showed that the commonly held assumption that women bring something different to the workplace is not supported by research. In her study, she examined women’s attitudes toward risk. Many people believe, and some research shows, that women tend to be more risk-averse than men. Could more women on corporate boards and in management positions lead to more sustainable decision-making? Johansen’s examination of the literature on women and risk suggests the answer is No. Under the same conditions as men, women act similar to men. Given those findings, what conditions would make women more risk-adverse? Why do women not see (or gain) the same benefits as men do when they take risks?

 In contrast to Johansen’s narrowly defined question, an open inquiry into diversity was the aim of Jesper Bernhardsson, the other SSE student to receive a PAUSE scholarship. To investigate the effects of diversity on sustainable group performance, Bernhardsson considered many forms of diversity – not only gender but also professional diversity, age, ethnic origin, national culture, and others. He explored their effects on teams – both positive and negative effects – and reviewed what the literature has to say. Among other results, Bernhardsson found that diversity may not be an advantage in routine activities and very specific and strictly limited tasks. Again, the findings ran counter to current received wisdom. Don’t we find the greatest diversity in teams with specific and limited routine tasks? This is what we see on the shop floor, on the production line, and in settings with standardized operating procedures (such as at fast-food chain restaurants). If diversity does not benefit that work, is it because the advantages of diversity are neutralized by standardization? Does that mean that positions often seen as entries into working life for members of disadvantaged groups might in fact be positions where such workers learn to stifle their own distinct characteristics?

 Representing the business world, Martin Tivéus, CEO of Avanza Bank, shared his ideas on diversity. According to Tivéus, an explicit rule at Avanza is NOT to actively strive for gender diversity. The organization prefers to look at differences on an individual level, that is, personality type, ways of addressing and solving problems, and attitudes toward risk. As for gender diversity among employees, he claimed Avanza had done well, proudly noting that the Bank’s 46 managers are evenly divided between men and women. He also said that he had pushed a female executive to hire more men to better balance gender in her department, so some guidance does take place. The most puzzling aspect of Tivéus’s presentation was his focus on the diversity of personalities. If diverse personalities are most important, then such diversity can be found in a group with members coming from a single neighborhood, social class, and generation, having the same ethnic background and national culture. So, why all the fuss about diversity and inclusion if personality is all that matters?

In contrast to Tivéus’s comments, SSE Associate Professor Laurence Romani’s presentation of recent research did not mention personality at all. According to Romani, the way to achieve diversity is a conscious and well-defined recruitment and management process. She asked questions that suggested different approaches to diversity and sustainability: What traits or characteristics are attached to each difference (such as gender)? Does diversity inherently create systematic advantages? What leads to differences and discrimination? How do we relate to differences in organizations? Her conclusion was that giving advice on diversity is simple as well as difficult. The core of the challenge is to see the differences that are relevant (rather than assigning differences a priori) and then to understand them. Only then is it possible to bridge the differences and finally value them. Romani called this approach “respectful management of diversity.”

All presenters elicited many comments and questions from the audience, who showed intense interest and knowledge of the topic. The discussion added to the perception that much remains to be explored in the field of diversity and sustainability.

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