Cultural Diversity in Organizations and the Role of Leadership

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A mature businessman in a wheelchair meets with a diverse group of four co-workers in a small conference room.

Encouraging and embracing cultural diversity in an organizational setting yields many benefits for employees and employers alike, and the practice has become an important topic in society today. According to the U.S. Department of Health and Human Services, “Culturally competent programs maintain a set of attitudes, perspectives, behaviors and policies — both individually and organizationally — that promote positive and effective interactions with diverse cultures.” Leaders looking to effectively run for-profit and nonprofit organizations should understand the important roles that cultural competence and cultural diversity play in reaching long-term goals.

Efficient organizational leaders understand that respecting and emphasizing diversity in the workplace allows different perspectives and experiences to come together. They also demonstrate how the fusion of diverse worldviews, ideas, actions and decisions produces a variety of benefits for their organizations. Implementing strategies — such as developing a strong sense of cultural competency according to current and emerging trends — can help organizational leaders maximize the benefits of cultural diversity and achieve optimal results.

Individuals interested in exploring the role of cultural diversity in organizations and becoming leaders in the workplace may want to consider earning an online Master of Arts in Organizational Leadership.

Why Cultural Diversity Matters for an Organization

Creating a work environment consisting of different cultural, racial and ethnic groups can add perspective and depth to an organization’s mission and goals. A broader perspective can enable an organization to build more comprehensive growth and outreach strategies.

On a large scale, cultural diversity in organizations permits global outreach, as individuals from different countries and cultures can communicate with members of foreign organizations without language or cultural barriers. Having a team of effective cross-cultural communicators can stimulate an ongoing dialogue that works toward improving an organization’s creativity, productivity and public perception.

At its core, cultural diversity consists of celebrating people from diverse backgrounds, as they can each bring essential perspectives and ideas to their organizations. Promoting cultural awareness and cultural competence in the workplace can also boost morale, with each employee understanding that they are valued for their unique identity.

Commitment to cultural diversity can also benefit the relationship between an organization and its target audience. On a basic level, an organization’s employees should be able to relate to and speak the same language as their customers. On a psychological level, the Houston Chronicle explains, “communities and customers typically prefer to do business with companies who employ people from their own backgrounds.”

Studies have shown that when organizations hire employees from similar cultural or racial backgrounds, those employees are less inclined to communicate about both small- and large-scale issues, since most everyone believes they are already on the same page about certain decisions. Conversely, when organizations cultivate a work environment that honors and celebrates the cultural diversity of its employees, co-workers tend to be more open to communicating about issues, topics and decisions, since they do not assume they already know everyone else’s perspective.

Ultimately, leaders who encourage cultural diversity in organizations can be more successful and profitable than their less diverse competitors, as they can leverage this range of perspectives to come up with more complex ideas, innovative products and unique business strategies.

How Leaders Can Promote Cultural Diversity

Leaders can help an organization encourage and embrace cultural diversity and inclusion in the work environment. They set the standard of excellence for their employees and entire organizations. If a leader is not inclusive, their organization will be influenced by their thoughts, actions and decisions, even if some of the employees disagree with them. On the other hand, encouraging cultural diversity in organizations through culturally competent leadership can create a sense of community in a group or institution.

Leaders who possess a thorough understanding of a culture’s customs, traditions and belief systems can build strategies that acknowledge and honor these qualities. Strategies such as active inclusion and leading with empathy can help an organization successfully maintain a culturally diverse focus. Personally exhibiting cultural competencies and enforcing a zero-tolerance policy for discrimination can be a means by which leaders promote cultural diversity. Individuals working at any level of an organization can benefit from cultural diversity, as it creates a safe and comfortable workplace for all.

Trends in Cultural Diversity

As cultural diversity in organizations increasingly becomes a non-negotiable aspect of the workplace, it is essential for leaders to recognize different trends.

Increased support of gender identity and a growing understanding of unconscious bias are both shaping and expanding the perception of cultural diversity in organizations. Leaders should always be aware of the country’s anti-discrimination laws and how they are implemented in the workplace. Equally as important is the recognition of social changes, such as evolving norms regarding sexual orientation and the growing usage of gender-neutral and nonbinary pronouns.

Leaders need to be aware of how their own conscious or unconscious biases may have an impact on whom they hire and how they treat their employees. To be effective, organizational leaders need to recognize the ways they may be discriminating against employees, in their thoughts, actions or decisions, and actively eliminate those intentional or unintentional biases. It is important for leaders to deploy flexible cultural diversity strategies that can incorporate current and future trends, as the concept of cultural diversity continues to evolve.

Earn a Master of Arts in Organizational Leadership

Cultural diversity in organizations is growing in importance and necessity. Individuals do not want to work in environments where they will encounter discrimination, and customers don’t want to do business with culturally incompetent or insensitive organizations. By encouraging cultural diversity and cultural competency, leaders can cultivate comfortable and effective workplaces.

If you are interested in promoting cultural diversity in organizations in a leadership role, consider pursuing Rider University’s online Master of Arts in Organizational Leadership, which offers a Developing People and Organizations concentration. Learn more about how the degree program can help you pursue your professional goals as a leader of a nonprofit or for-profit organization.

Recommended Readings

5 Essential Conflict Management Styles Organizational Leaders Must Know

5 Leadership Strengths to Inspire Your Team and Organization

Employee Training and Development Programs and Methods


American Management Association, “Managing Cultural Diversity”

Business 2 Community, “The Importance of Cultural Diversity in the Workplace”

CIO, “Diversity and Inclusion: 8 Best Practices for Changing Your Culture”

Forbes, “The Benefits of Cultural Diversity in the Workplace”

Houston Chronicle, “The Advantages of Diverse Culture in the Work Force

National Career Development Association, Understanding Bias When Working with Multicultural Populations

NPR, “He, She, They: Workplaces Adjust As Gender Identity Norms Change”

U.S. Department of Health and Human Services, Cultural Competence