Diversity is an issue that has raised its head countless times in recent years and no sector has been left unquestioned. Each industry we serve at Carmichael Fisher – from transport to life sciences, finance to technology – has been under scrutiny for their seemingly one-track approaches to executive appointments.
This has been particularly evident in the real estate sector, which can be viewed as a microcosm of the wider business world. While the industry’s biggest names are beginning to make the necessary changes, although in many cases this is as a result of pressure rather than any kind of altruism, it is smaller organisations – the SMEs and the partnership-style organisations – at which the stereotypical profile of a real estate professional has remained the same for decades, either through a lack of awareness, or lack of resources to change.
I have worked in the real estate industry since 2005, and since then I have seen organisations start to try and change, and ultimately miss the mark. Business leaders are still, for the most part, white middle-aged men. This is in spite of the fact that more diverse organisations are proven to be more successful – by bringing a wider range of ideas and experiences to the table, different ideas and approaches will emerge and, as a result, better business offerings will be shaped.
As with any legacy problem, solving it is far from a straightforward task, nor can it be rushed. Although the average tenure of CEOs is decreasing, it remains at more than five years at leading companies and is even longer at smaller businesses. The good news is that diversity is now a topic being discussed at the top table, with leaders aware of how important it is to continuing success and growth in a modern market.
But as highlighted by Amanda Clack, Head of Strategic Advisory at CBRE, we need to stop only talking around the problem, and start taking steps towards achieving equality as well. Having said that, it’s high time we stop seeing diversity as a ‘problem’ as such, and instead begin looking at it as an opportunity to revolutionise the workforce in order to better represent the people it serves. After all, real estate is all about people.
Plan for the future and judge a candidate’s potential
Making executive appointments can only truly be judged on ability to succeed in the role. There should be nothing else that comes into consideration, and yet research by Harvard Business School proves that businesses still favour male executives over their female counterparts. In the hiring process, it is worth paying attention to and assessing what the candidate has overcome in order to get to this stage of the process. Shortlisting candidates based purely on merit and previous achievement denies those who have previously not been given the opportunity to finally succeed. Plan for the future and judge a candidate’s potential.
While the long-term solution involves attracting diverse talent into entry level positions before nurturing these employees to become the leaders of tomorrow, the opportunity will continue to be missed for years, and perhaps even decades, to come because progessing to the c-suite takes 24 years on average. Immediate action needs to be taken to attract women and BAME candidates into senior positions to kickstart change within real estate – but how do you find the right talent when the pipeline is faulty?
You will have heard transferable skills be talked about endlessly and it’s not without good reason. The right person for the role isn’t going to appear right in front of you, and the employers of the industry’s top talent are going to be doing everything they can to keep hold of their staff, so it’s our job to go in search of your next executive hire. As clients begin wanting more diverse shortlists, attracting candidates from other verticals may hold the answer.
As an example, one of my clients, a global real estate firm, recently appointed a new executive to head up a key division, despite them not coming from a core real estate background. What they have done, however, is successfully grown business divisions at exponential rates in other sectors by knowing how to lead teams, develop strategies and manage people in the right way. That is experience they are now bringing into the sector, as well as being able to approach the challenge at hand with a fresh and innovative outlook.
It can be difficult for legacy leaders to understand why you would appoint someone with no industry experience into management positions, but the proof is in the pudding – it works, and it helps to build more diverse teams quickly, subsequently leading to success. Other industries are demonstrating that they are able to do it, and while real estate has enjoyed its success over the years, the longer that it continues to stutter in the push for diversity then the longer it will be before the industry reaches its full potential.
About Rob Johnston
Rob is a Consultant within the Real Estate Division at Carmichael Fisher. Having worked in the real estate sector since 2005, Rob joined the CF search team in 2015 to help our national and international clients with their executive hiring challenges.
For a confidential conversation about how Rob and the team can help with your executive appointments in the Real Estate industry, feel free to connect with him directly here.