Diversity and Inclusion:
The Path to Achieving Our Full Potential
President & Chief Executive Officer
Royal Bank of Canada
Burlington Economic Development Corporation
September 22, 2011
Join Gord as he shares insights on why diversity matters,
the success behind RBC's activities, how diversity can help
spur growth and innovation and the business imperative that
all Canadian companies should embrace to succeed in today's
fast paced, ever evolving international economy.
Good afternoon. It's a real pleasure to be here and to share
with you my thoughts on Diversity and Inclusion and the contribution
it can make to the growth of our businesses, our cities and
To set the context, let me say a few words about RBC, although
many of you are familiar with us. We have five business segments
- Canadian Banking, Wealth Management, Insurance, International
Banking and Capital Markets. We have approximately 18 million
clients and 77,000 employees in over 50 countries. Our Canadian
workforce is approximately 55,000.
We have been in business for a long time, and over the past
couple of decades our business mix has diversified significantly
and this strategy of diversified businesses is one of our
I'm delighted to be in Burlington. I know your city is recognized
as one of Canada's most dynamic and that you have been ranked
as the best city to live in the Greater Toronto Area and the
third best city in Canada. I also applaud the strong spirit
of collaboration between local companies and the city that
has helped to achieve those results and improve Burlington's
long-term economic prosperity.
In fact, your speaker series is very aptly titled: Connect,
Collaborate, Create and there are some obvious parallels between
my topic today. In many ways, diversity is all about connecting
- and inclusion is all about collaborating across those connections.
As for the create part - that's all about innovation and driving
growth as a result.
I am a firm believer in the power of cities to be engines
of economic growth in this country. Research has shown that
there is not one homogenous "national" or "global"
economy as we often think of it - but rather a common market
of local economies, including urban economies - and that strengthening
these local economies is what will drive the overall economic
success of our country.
But, the process of economic development is not simple. It's
complex and multi-dimensional, and highly dependent on innovative
thinkers. It requires individuals who care not only about
what this region is today but what it could be tomorrow. It
requires long-term vision and planning and it needs leaders
from all areas of the community - business, labour, academia,
social services, NGO's and government - leaders who live here,
work here and build their businesses here, and people who
can actively participate in formulating a shared vision. It
requires a multi-stakeholder approach like the one you have
adopted here in Burlington.
1 in 6 Canadians live in this vast region around Toronto
and it is our country's most important and our flagship in
so many areas - and Burlington is an important part of that
This region - and Burlington - is also a model of diversity,
inclusion and integration. This has been an unparalleled success
in our region. It has brought vitality, culture and economic
growth and RBC has benefitted from all of that.
Diversity and inclusion is something we want to get right.
I say this from my perspective as CEO of RBC, certainly, but
also from the perspective of a resident of southern Ontario,
a community member, a taxpayer and a participant in many of
the cultural and charitable activities that take place in
And so while my interests and experiences extend right across
the social, economic and political fabric of this region,
today I'd like to talk about why diversity matters, its central
role in driving productivity, innovation and growth, and how
embedding diversity in what we do at RBC is helping us achieve
our potential as a company, with our clients and in our communities.
And how it is helping our employees achieve their full career
WHY DIVERSITY MATTERS
I am often asked: Why does diversity matter to business and
to RBC? Simply put, it makes good business sense. It's the
smart thing to do.
Why do I say that? First, talent comes in both genders and
from diverse backgrounds. Attracting, developing and retaining
the best talent is essential to the success of any business.
Reflecting the clients we serve is also a business imperative.
Let me start with newcomers. As you know, the demographics
in this country are changing and Statistics Canada projects
more change will come.
Our diverse population is both a unique strength for this
region and a critical component of our economic success. The
growth in visible minorities and new immigrants is dramatic;
especially in our large cities. For the Greater Toronto Region,
visible minorities are projected to be 63% by the year 2031.
With baby boomers retiring, our workforce is shrinking. Immigration
can offset this, but our success depends on attracting skilled
immigrants and ensuring they find work that utilizes their
expertise, education and experience. We know it's the right
thing to do, but we're also clear on the business potential.
That's why some newly released numbers are troubling when
it comes to relying on immigration to fuel growth. While our
region is the number one destination for immigrants settling
in Canada, we have seen a 17% (17,000 people) decrease in
the number of immigrants it receives over the last decade
due to increased attractiveness of other Canadian regions.
We surpass most city regions in integrating large numbers
of newcomers, but there remain significant opportunities to
help immigrants realize their full potential as a key competitive
advantage for the region.
Immigrants consistently face both higher unemployment and
a greater incidence of underemployment than people Canadian
born. Immigrants with a university degree have twice the unemployment
rate and earn 40% less than Canadian-born people with a university
degree. And, the situation is worsening - more recent cohorts
of immigrants are falling further behind.
For a country that prides itself on its diversity, fairness,
and our open door policy, this is a surprise. For a country
whose demographics promises worker shortages in the decades
ahead, this doesn't make sense. Diversity is one of our competitive
A large portion of the region's immigrants comes from rapidly
developing emerging markets. As more of the world's economic
growth shifts to those markets, immigrants will increasingly
be an important asset that differentiates our region from
Newcomers enrich our region's human capital with their international
experience, diverse language skills, access to international
networks and understanding of global markets. Many developed
economies are competing for the same immigrant talent and
being a recognized leader in diversity and inclusion can help
us better compete. Studies have shown that Toronto, Montreal
and Vancouver are among the most attractive places for employers
precisely because of our multilingual workforces, our commitment
to equal opportunity and high literacy.
For business leaders in this region, this is an important
means to succeed and contribute to Canada's future as a player
on the global stage.
If you aren't convinced, let me share a few more numbers
with you. In 2005, RBC Economics found that if all new Canadians
were fully employed at their level of education and experience,
earning equal pay to someone born in Canada, personal income
would increase by $13 billion a year. We are leaving economic
growth - never mind fuller lives and stronger communities
- on the table.
And, as the recent Conference Board Report on Women suggests,
we may be doing the same thing with women. Women make up nearly
half of Canada's labour force, yet as the study's evidence
suggests, women have made very little progress over the past
two decades in reaching senior management levels.
The number for women senior managers has hardly changed for
more than 20 years with men still more than twice as likely
to hold a senior executive position. And, according to the
study, it doesn't look much better in middle management, which
is the critical pipeline for future women executives. The
number of women in those roles has only grown 4 per cent since
1987. Apparently, if you were to extend that rate, it would
take 151 years before the ratio of men and women at the management
level is equal.
Like the underemployment of new immigrants, this paucity
of senior women is troubling. It can prevent younger women
from entering certain professions or finding role models.
A lack of diversity can also impact overall employee engagement,
productivity and innovation. It has been shown that companies
with more women senior managers typically have higher total
returns than those with fewer women. Again, we are leaving
economic growth on the table - never mind demonstrating a
real commitment to the principles of equity and fairness in
Speaking as a business leader, I know that achieving gender
equity is key to the success of our company and our country.
Canada cannot succeed in an increasingly global and knowledge-based
economy without the full and active participation of women.
Fifty per cent of Canadians are women - they obtain the majority
of university degrees and influence over 80% of purchasing
decisions. Women also own or manage over 40% of all businesses
in Canada. We simply cannot afford to waste this human resource.
Over 60% of our 77,000 employees globally are women. It is
abundantly clear to me that it is in our best interest - you
could call it "enlightened self-interest" - to create
the conditions where women can excel. This is why we say it
is the smart thing to do.
At RBC, this means fostering our corporate values of respect
and integrity. This means creating a world where everyone
is respected for who they are and what they bring to the table.
It is a fundamental tenet of a civil and just society. A place
where every woman and man can achieve their full potential.
That's why we also say it's the right thing to do. At RBC,
we support this objective by implementing workplace programs
that enable women to build their confidence, to develop their
skills and talents, and to realize their dreams.
Over the last 30 years or so, RBC has focused on enabling
women to achieve leadership roles. Our first woman vice president
was appointed in 1979. Not a particularly great statistic.
We were already a 110-year-old company at the time. However,
today about 38% of our executives in Canada are women, 54%
of managers and professionals are women, something we are
proud of, but not complacent about. The work must continue.
Women bring unique and valuable perspectives to our social
fabric and tangible bottom line results to our businesses.
Our society needs their contributions and the success of women
is one of our country's greatest strengths.
DIVERSITY AS A DRIVER OF PRODUCTIVITY, INNOVATION AND
Given the numbers, it should be clear that diversity can
also drive winning customers and markets that underpin economic
Today, it is more important than ever to hire the market
you serve - and then unleash the diversity of those employees
- because they are where you learn as a company to understand
every single person you do business with in every corner of
The economic and business imperative is compelling - diversity
has huge potential to drive innovation and productivity for
companies and economies. Recent research shows that highly
skilled newcomers are upping patent applications - a proxy
for innovation - when they are included in the workplace.
Institutions and organizations that actively foster diversity
- that work to get the most out of the mix - will directly
reap the benefits from their actions. We know the benefits
that can flow when we get it right.
Diversity is a strong driver of productivity and a more productive
economy can grow more quickly, create more jobs and offer
better standards of living. We live in a knowledge intensive
economy - having a highly skilled workforce is key.
And, with fewer people working in the future, immigration
can make up the difference. But, the effectiveness of immigration
depends on attracting skilled immigrants and ensuring they
find work that is consistent with their levels of education
and talent. If Canada - and the southern Ontario region -
-is to maintain and improve its standard of living, we must
become the destination of choice for skilled immigrants, scientists,
professionals and entrepreneurs.
Our labour challenges are real and will impede future economic
growth if we do not find a coordinated strategy to leverage
the skills and talents of people who have come here looking
for a chance to succeed.
In fact, recent research from the Toronto Region Immigrant
Employment Council, which I chair, shows that diversity in
leadership in on the rise - which is very promising and we
expect that trend to continue.
DIVERSITY AT RBC
At RBC, our focus is on how to put that diversity to work
for economic benefit. And while I frame it in the economic
imperative, this notion also includes the social imperative.
Let me talk a little bit about the results we see at RBC
from our investment in diversity. As Canada has changed over
the years, so has RBC. While we have been engaged in diversity
efforts since the 1980s - that's when our focus on women started
- the demographic and business trends heightened the need
for a well-defined diversity strategy. For us, diversity is
not a stand alone agenda, but is integrated into our business
strategies and embedded in what we do. And, it is also one
of our five core values.
Blueprint - which you can find on our public web site
- is based on three key pillars: Talent and workplace, marketplace
(or clients) and communities. We want to be a recognized leader
in workforce diversity; to be the financial institution of
choice for diverse clients; and, to help build healthy communities,
which are increasingly diverse.
As you have heard, we have a strong focus on new immigrants,
so let me just talk briefly to how we bring it all together
to drive business value and change in that area.
In our workplace, through Bridging Programs, we provide internships
to new immigrants, many of whom we subsequently hire.
In the Marketplace, we have numerous programs that specifically
address the needs of newcomers - such as our Welcome
to Canada website, help for newcomers wanting to start
or grow a business, fact sheets in 14 languages and telephone
banking services engaging translators who speak over 150 languages.
Last year we launched an unsecured credit card for new immigrants
to help them build a Canadian credit history and also a free
day-to-day banking account for 12 months. And, we are now
piloting a loan program in the GTR to help newcomers get a
loan to go to school to obtain Canadian credentials and get
I know Laura Gainey's team is championing diversity across
the market and that we have many RBC employees helping to
bring our diversity strategy to life.
We are also partnering to drive change in the broader community.
We have established strong partnerships with not-for-profit
organizations. We've chosen organizations that understand
the importance of collaborating with multi stakeholders because
that's what's needed for newcomer success. For example, we
sponsor TRIEC's Immigrant Success Awards, which recognizes
employers who are driving real progress in the integration
of newcomers into our regional economy.
Through this integrated approach, not only have we contributed
to RBC's diversity and ability to serve clients, but raised
this issue to a national level to multiply our impact.
We have also become increasingly diverse inside RBC
and at all levels of the company. For example, of the nine
people on my executive committee - two are women - and they
are both visible minorities. And this diversity in management
and the broader workforce cascades within the organization.
It's because we believe that having diversity brings a plurality
of perspectives, of work experiences and of life experiences,
and this helps us make better and more balanced decisions;
and, it brings cultural competencies and relationships to
win new clients and to better serve them.
Visible senior leadership commitment and clear accountabilities
are critical to the success and sustainability of diversity
efforts. We created our Diversity Leadership Council shortly
after I became CEO in 2001, and I have chaired it since that
time. It has been critical to have senior leaders from all
businesses and functions on the Council. The Council has been
key to keeping us on track. We also invite employees to the
DLC so that we can listen to their experiences and gain a
deeper understanding of their personal experiences at our
company. I personally find that to be very worthwhile.
We find that building a diverse company happens naturally
in the broader workforce, but that at more senior levels that's
not always the case, as the Conference Board report shows.
There are challenges and barriers. Our approach at RBC has
been to establish goals, ambitious goals I might add, for
executive and senior manager staffings.
No question, we focus on talent first. But the definition
of talent isn't quite so black and white. We know it isn't
about hiring in one's own image. It is also about valuing
diverse experiences, about seeing the potential in all candidates.
I believe it is important to invest in people so they develop
the capabilities needed to further their careers. As a leader
one needs to take chances on people - I've had mentors and
sponsors who did that for me. And when I've done it, I have
rarely been disappointed.
Having a broad mix at the table is important, but while representation
is necessary, it isn't sufficient; it must go hand in hand
with inclusion. Inclusion is being valued, respected and supported
- and being enabled to fully participate in the workplace;
where every individual can achieve her or his full potential.
Inclusion needs to be reflected in an organization's culture,
practices and relationships.
At RBC, we have diversity objectives, just as we have objectives
for other important business issues. We report on it, we talk
about it at management meetings, and report on it to the Board.
We are creating a culture where Diversity is an expected measure
of business performance. We also transparently share results
across our businesses to help drive accountability.
Don't get me wrong! We have our challenges and not
everyone buys in to the same degree. For example, we have
challenges in specific businesses -- but we engage the leadership
to help drive the change.
I believe that corporations must see diversity as not
just an add-on or a business opportunity, but a path to excellence
embedding inclusion in your culture will help you get the
most out of the mix and that the benefits will flow when you
get it right.
At RBC, we have learned that when diversity and inclusion
is part of decision-making, we are better positioned to connect
with our customers and provide more meaningful products and
services, driving customer loyalty and an enhanced bottom
line in return.
Meanwhile, ensuring that each and every promising employee
has an opportunity to contribute can pay off exponentially
by driving innovation and growth; strengthening our workforce
and enhancing our profile with potential recruits - not to
mention inspiring other employees to give their best.
Diversity will increasingly be a key driver of economic growth
in the future. It is both the right thing and the smart thing
to do and something that we at RBC are passionate about.