How to improve boardroom performance: Ensuring voices are heard

The corporate governance landscape constantly changes but boardroom inclusion is and will always remain to be the very foundation for effective and innovative decision-making. It enables the growth of more symbiotic and thus sustainable ecosystems. Sustainable and healthy change comes from ensuring that every voice is heard, valued, and empowered to contribute meaningfully. Drawing from the latest behavioural economics and social sciences research, I explore some actionable strategies for fostering an inclusive culture in boardrooms.

Where are we standing in terms of boardroom representation?

Despite increased awareness and initiatives, achieving truly inclusive boardrooms remains a goal tied to creating less homogenous board compositions. Recent studies from institutions in North America, Europe, and Asia indicate that while board diversity has grown, representation based on gender, ethnicity, socioeconomic background, neurodivergence, age and disability still lags far behind the diversity in our communities. This leads to tangible losses for the organisation. The McKinsey & Company 2023 report reveals that companies in the top quartile for ethnic and cultural diversity on executive teams were 36% more likely to outperform on profitability.

However, while representative numbers are important, we cannot forget that diversity shouldn’t follow inclusion but that inclusion is needed to sustain a diverse and productive workforce. A healthy ecosystem that works based on merit, can not exist in a system that doesn’t provide everyone with the same opportunities and rewards. Further emphasising the main point, a report by the Chartered Governance Institute UK & Ireland found that many boardrooms exhibit worryingly low levels of psychological safety, leading to the avoidance of important conversations that involve vulnerability, challenge current ways of working and result in a lack of inclusion. So if the soil of your garden is of poor quality, you can not expect a wide variety of plants to blossom, in fact: very few plants will. What would your next step as the gardener be? Improve the soil before planting.

The impact of low levels of psychological safety on boardroom dynamics

One of the less-discussed barriers to true inclusion in both homogenous and diverse boardrooms is the phenomenon of covering. Covering refers to downplaying or hiding aspects of one’s identity and/or personality traits -such as ethnicity, religion, sexual orientation, disability, health, family composition, language and speech or even personal interests- to conform to perceived norms and avoid drawing attention. Research by Deloitte reveals that 60% of all employees in the United States report covering in the workplace, with even higher rates among underrepresented and underserved identity groups. Individuals with multiple identity aspects that are underserved and underrepresented in our communities often experience a higher incidence of covering, as they navigate the complexities of belonging and acceptance within organisational settings.

In the boardroom, covering can significantly impact decision-making and team dynamics. Board members who feel the need to mask their authentic selves contribute less openly, stifling innovation and reducing the breadth of perspectives considered. Covering also takes a toll on mental health, increasing stress, reducing job satisfaction, and ultimately impairing overall performance and personal development. When board members expend energy on masking their identities instead of fully engaging in discussions, the entire board’s effectiveness suffers and it is important to note that research indicates that leaders often exhibit more covering behaviours than their subordinates, suggesting a discrepancy in openness at different organisational levels. The wellbeing report of Deloitte found that C-suite or other executives and senior manager respondents had the highest rates of covering across organisational roles, at 67%. This data is in line with the report of the Chartered Governance Institute UK & Ireland about the low levels of psychological safety in our board rooms.

The psychology of inclusion

Behavioural economics provides valuable insights into the biases and dynamics that hinder true inclusion. Cognitive biases such as homophily (the tendency to gravitate towards people similar to ourselves) and confirmation bias can lead to homogenous decision-making, even in diverse boards. One recognisable example of how our automated thinking influences decision-making in boardrooms is the anchoring bias. For example, when setting corporate goals or budgets, the initial figure proposed by a senior member often anchors the discussion, even if it’s not optimal. This can lead to a narrow focus and the undervaluation of alternative perspectives, particularly those offered by newer or less experienced board members. Recognising and mitigating such biases is crucial to fostering inclusive and effective decision-making.

Additionally, research by Harvard Business School highlights that diverse groups often experience greater conflict—a natural outcome of varied perspectives. To address this, boards must prioritise creating an environment where all members feel safe and empowered to share their viewpoints. Another point to address is how board members look at conflict, which can be both valuable and necessary yet uncomfortable.

But how do we create an inclusive environment on our board?

Building a truly inclusive boardroom requires intentional efforts to amplify and value all voices. Here are practical strategies supported by research and expert recommendations:

Establish clear communication protocols:

Use structured agendas and moderated discussions to ensure equitable speaking opportunities. Techniques such as round-robin discussions can help quieter members contribute without being overshadowed by dominant voices. A study from MIT Sloan highlights that structured conversations lead to more balanced participation and better decision-making.

Encourage active listening:

Foster a culture where members actively listen rather than wait to speak. Tools like reflective listening or summarising others’ points before responding can ensure ideas are genuinely considered. Research from the University of Michigan shows that active listening strengthens team cohesion and enhances problem-solving.

Rotate roles and responsibilities:

Assign rotating roles for tasks such as meeting facilitation, which allows different members to guide discussions and ensures balanced participation. Studies by Deloitte suggest that role rotation helps break hierarchical patterns and empowers diverse members to take leadership roles.

Recognise and address biases:

Train board members to identify and mitigate biases that may cause certain voices to be undervalued. Unconscious bias training and regular self-assessments can be instrumental. For example, a 2022 report by Catalyst found that bias training improved inclusion metrics by 25% in organisations that implemented it effectively.

Leverage technology:

Digital tools, such as anonymous voting or idea-sharing platforms, can help surface contributions from members who may feel hesitant to speak up directly. Research by Gartner demonstrates that technology-enabled decision-making can increase participation by 30%.

The Business Case

Ensuring that every voice is heard in your board is simple advice but it also remains one of the elements plenty of boards have yet to accomplish. Here’s how valuing all perspectives drives success:

Enhanced decision-making:

Boards that prioritise inclusive dialogue make more informed decisions. Diverse viewpoints challenge assumptions and reduce blind spots, leading to better outcomes. Research from McKinsey highlights that companies with highly diverse boards outperform their peers by 36% in profitability.

Stronger team dynamics:

When members feel their contributions are valued, trust and collaboration improve. This fosters a cohesive board culture that can navigate challenges effectively. A study from the Journal of Business Ethics reveals that inclusive practices enhance trust and reduce conflict in board settings.

Improved stakeholder engagement:

Inclusive boards are better equipped to understand and address the needs of diverse stakeholders, enhancing corporate reputation and loyalty. According to PwC’s Annual Corporate Directors Survey, 85% of directors believe that board diversity improves stakeholder engagement.

Building an inclusive culture

Achieving inclusion is an ongoing process that requires systemic change. Boards can take the following steps:

Foster psychological safety:

Create an environment where members feel safe to express dissenting opinions without fear of judgment or retribution. Google’s Project Aristotle found that psychological safety is the most critical factor in high-performing teams.

Seek continuous and actionable feedback:

Regularly solicit feedback from board members on meeting dynamics and inclusion efforts. Use this input to make adjustments and improvements. Feedback loops, as demonstrated by studies at Stanford, help organisations refine practices and sustain inclusion efforts.

Invest in development:

Provide ongoing education on inclusive leadership, communication skills, and cultural intelligence to empower members to contribute effectively. Harvard Business Review suggests that inclusive leadership training boosts team innovation by 17%.

Celebrate contributions:

Recognise and highlight the unique value each member brings to the table, reinforcing the importance of diverse perspectives. Public recognition of contributions has been shown to increase engagement and satisfaction, according to a Gallup workplace study.

Walk in operational shoes every year

It is equally important as a board member to understand the daily operations and identify with the people in the organisation itself. That is why it is incredibly valuable to reward yourself with the experience of walking in the shoes of front-line staff. It allows you to learn how your decisions impact the lives and work of your employees and listen in on the issues and topics that are top of mind amongst your workforce. This practice can keep you both grounded ánd connected.

Use an intersectional lens

An intersectional approach is crucial for understanding how overlapping identities influence boardroom dynamics. For example, the challenges faced by a Black woman may differ significantly from those faced by a white woman or a Black man. Boards must adopt nuanced strategies to ensure inclusivity across all dimensions of identity.

(read more about how to build your intersectional awareness here)

Take a step forward

Inclusion in the boardroom begins with a commitment to listening and valuing every voice. As global markets grow more interconnected and diverse, boards that fail to adapt risk obsolescence. By fostering an environment where all members feel empowered to contribute, boards can unlock new opportunities, enhance resilience, and drive sustainable success.

To all board members out there, this is your moment to lead with foresight, empathy, and determination. You can help build boardrooms that not only look diverse but also function inclusively, ensuring that every voice shapes the future of corporate governance.