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Family Business Report identifies opportunity for improving diversity in Australian family businesses

Grant Thornton’s 2023 Family Business Survey data revealed just under half of all respondents (49 per cent) think gender diversity is a priority or considered important for their business.

This may be a result of the current uncertain economic climate in Australia as it will pull business owners back into the operations, where there is less focus on strategic pillars such as diversity and inclusion initiatives.

Research shows the relationship between diversity on teams and financial outperformance is correlated, with evidence of it strengthening over time (McKinsey, 2020). The businesses who are excelling in the diversity and inclusion space are proactively adopting structured strategies and approaches to reach their gender diversity goals, creating a sustainable inclusion culture.

The Grant Thornton Family Business Survey Report reiterates there are advantages for family businesses who implement diversity. A key differentiator for family businesses is their long-standing values that are integrated through all aspects of their operations, and while diversity targets remain a lower priority in the current economic conditions, the Survey results confirmed family businesses can still identify the top benefits of gender diversity including staff performance, acquisition and retention, and improved decision-making.

The Survey revealed the following groups with the most genuine interest in implementing gender diversity strategies within their business:

  1. Respondents aged between 18 and 24 are interested in developing a diversity strategy (67 per cent).
  2. Women in family businesses recognise the benefits of sustainable strategies (60 per cent).
  3. Businesses who have been operating 71-100 (third or fourth generation) years are developing, embedding or realising a gender diversity strategy (50 per cent).

These benefits do not come without challenges, with the Survey’s respondents also identifying barriers to achieving gender diversity outcomes such as lack of suitable candidates to employ (19 per cent), low strategic priority (14 per cent), and a competitive job market (7 per cent), with a quarter (25 per cent) of respondents noting there are no barriers to diversity within their family business.

Kirsten Taylor-Martin, Partner & National Head of Family Business Consulting at Grant Thornton said: “Creating a diverse team is important, but it doesn’t come without challenges. Industries that have more female and female-identifying participation such as childcare, as well as family business owners who have children all from the same gender working together, may find it more challenging to think outside of the box when it comes to their gender diversity strategies. However, now is the perfect opportunity to try and approach diversity from a new angle, building structures into your business governance frameworks to ensure diversity of thought, even when industry barriers seem present.

“For family businesses to continue to incorporate diversity and gender into their business structures, it’s about identifying what they can – and are most likely already doing through their engrained family values. Family businesses need to go beyond finding diversity opportunities in operational staff and look to non-family employees, Non-Executive Directors, Advisory Boards or Partnerships to showcase diversity. It’s about fostering diversity to ensure quality decision-making, growth and the best outcomes for all people and the business,” continued Kirsten Taylor-Martin.

Diversity strategies can integrate into social and governance pillars, stemming from broader environment, social and governance goals within businesses. Grant Thornton Australia released its Family Business Report on 19 September 2023 in celebration of Family Business Australia Day revealing the key challenges and focal areas for Australian Family Businesses.

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