Change is good – Diverse workforces enable companies to thrive

I joked at our recent annual investors’ conference that some of our workforce was on the whole, a bit stale, pale and male. 

That was in reference to our global operating team, and it wasn’t anything personal — I love those deeply experienced corporate managers because they help our firm in so many ways. I pointed out the lack of diversity in this cohort because 30 years ago, when many of them started their careers, just about all you could find in leadership positions was guys who looked like them. 

We’re glad that’s changing, and we think it needs to change faster for companies looking to stay on the leading edge of our interconnected global market. Diversity is a laudable goal for ethical reasons and a nice differentiator, but we pursue it because we know it makes us better investors.

Diversity is a broad term, and for Riverside, we strive to build a workplace that includes people of all stripes. We have a ways to go, but we’re proud of the large number of women we have in leadership roles. We’d ultimately love to see more gender balance and people in leadership positions and throughout the organization with different ethnicities, religions, sexual orientations, nationalities and social/economic backgrounds. 

We’re working on it because it’s good for business. Studies prove that cognitively diverse teams solve problems faster than homogenous ones do.

New perspectives

A big part of success in investing or any field is looking at and solving problems in new ways. A room full of middle-aged white dudes will miss a lot of trends and possibilities. Some of the world’s fastest-growing companies serve markets and communities that are far more diverse than an average boardroom.

Employees with different backgrounds also add innovative new ideas, increase efficiency and keep companies fresh. This is especially important in leadership positions. 

We simply can’t think creatively if we all look the same, went to similar schools and joined all the same clubs. Companies that are myopic in hiring very often miss out on gritty, determined people who made their own success — the very kind of people who take good companies and make them great ones.

Perception matters

As a global firm that strives to attract investors of all stripes, partner with businesses in all corners of the world and attract the best talent, Riverside needs to be as representative of the world as possible. People want to work with those who can empathize and those who respect their varied experience.

An ongoing effort

Creating a diverse workforce doesn’t happen in a year or even a decade. It has to be a consideration with every hire. It needs to be a goal. And it needs to permeate a company’s culture. At Riverside, it’s not lip service — we’re working on diversity every day, and we recognize that we must do more. This effort doesn’t just apply to Riverside itself. It also is important at our portfolio companies. By looking more like the world, Riverside will operate more successfully in it.

Stewart Kohl is co-CEO at The Riverside Co.