DiverseCity Counts 5: Leadership Diversity in the Nonprofit Sector - Baby Steps, Big Strides, and Bold Stances (2012)

This research examines board diversity in the nonprofit sector, as well as the impact of this diversity.

This research finds that visible minorities continue to be underrepresented in nonprofit boards in the Greater Toronto Area (GTA). While visible minorities make up 40% of the GTA’s population, of the 4,254 board positions examined only 15.6% are held by visible minorities. The research also finds that all sub-groups of visible minorities are under-represented.

The good news is that a large number of organizations appear to recognize the importance and value of diversity. Of the more than 420 organizations that responded to our surveys, 77.9% have at least one visible minority on their board. A full 43.8% report having a formal working definition of diversity, and of these, 83.6% include ethnicity, race and colour, 49.4% include country of origin, and 36.3% include immigrant and refugee status in their definition.

More diversity equals better governance

The survey asked organizations to describe the effects that diversity on boards can have on the board’s performance. Overwhelmingly, respondents to the survey – who were primarily executive directors and board chairs – said that a diverse board contributes to overall board effectiveness by, for example, safeguarding and fulfilling the mission of the organization and
enhancing fiduciary oversight. Board diversity also improves stakeholder relationships, increases the organization’s responsiveness to the community and their clients, and brings fresh perspectives to decision-making.

What’s striking is that the more diverse an organization’s board, the more likely they are to report benefits of diversity. This finding suggests there is strength in numbers. Once a critical mass of
30% is reached, there will be an increase in the benefits of diversity experienced by the organization.

Practical recommendations for a more diverse and effective board

The full report includes a number of recommendations for organizations that wish to diversify their board. These include:

• Make diversity a strategic priority and set goals. Track these goals by asking current and potential board members about their ethnic and racial background. Use a third party, such as DiverseCity onBoard, to access new networks whenever possible.
• Align diversity efforts to the organization’s mission and mandate to ensure buy-in from the board and senior staff. Understand and communicate the benefits of diversity in leadership both inside and outside of the organization.
• Diversity on boards does not require compromising on technical or other skills. Recruit from the large and talented pool of immigrants and visible minorities in the region.
• Support the full inclusion of new members through the board’s policies and procedures. Organizations should ask new and diverse board members to sit on or lead special committees and projects that go beyond addressing diversity issues.
• Ensure a critical mass to reap the full benefits of diverse boards.