Why Leadership Is Critical to Building an Inclusive Workplace

By SHRM Editorial Staff

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In an era where workplace culture shapes organizational success, creating an inclusive environment is more critical than ever. "Our internal culture is our external brand," said Shaw Industries CHRO Mike Fromm on a recent episode of SHRM's People and Strategy podcast. Fromm's insights, paired with SHRM's The State of Global Workplace Culture in 2024 report, underscore the importance of fostering inclusion, empathy, and authentic engagement.

At its core, inclusivity ensures every individual feels valued, respected and has a sense of belonging. According to Fromm, Shaw Industries centers its culture on five principles: inclusion, empowerment, accountability, authenticity and support. "We recognize the uniqueness that every individual brings, but the power is when they come together and form teams," he explained.

This resonates with findings from SHRM's 2024 workplace culture report, which identifies empathy, open communication, and unbiased management as key drivers of a positive organizational culture. Empathy, for instance, is linked to improved employee satisfaction and loyalty, with 83 percent of employees in empathetic environments reporting high engagement.

Empathy and communication are essential, but their impact is amplified when leadership actively embodies these values. Leadership sets the tone for inclusivity relational excellence, where leaders frequently connect with team members to build trust. "When you establish trust, people are more likely to share their honest opinions," Fromm noted. SHRM's data supports this, showing that transparent, supportive leadership can significantly impact retention. Employees in positive cultures are four times more likely to stay with their employer compared to those in toxic environments.

Creating an inclusive workplace isn't without hurdles. Fear of failure or rejection can inhibit authenticity. Fromm suggested leaders build deep relationships with employees to understand their motivations and help them overcome such fears. "If you want people to be authentic, you must show vulnerability as a leader," he said.

Another challenge is managing high performers who disrupt culture. Fromm stressed the need for balance: "If someone works against our culture, there's not a place for them, but high achievers pushing boundaries should be understood and leveraged," he said.

Managing high performers who disrupt workplace culture presents a unique challenge. While such individuals often push boundaries and drive innovation, their behavior can sometimes undermine team cohesion. Fromm emphasized the need for balance, stating, "If someone works against our culture, there's not a place for them, but high achievers pushing boundaries should be understood and leveraged."

This perspective aligns with SHRM's 2024 workplace culture report, which highlights civil behavior and empathetic leadership as key to maintaining a positive culture. High performers who challenge the status quo can be valuable assets, but unchecked disruptive behavior risks creating a toxic environment. According to the report, toxic cultures have significant consequences, with 57 percent of employees in such environments actively seeking new opportunities.

Organizations can navigate this challenge by fostering open communication and ensuring that high achievers find meaningful work opportunities. These strategies help channel their energy productively while aligning their behavior with organizational values. By striking this balance, companies can harness the strengths of high performers without compromising team dynamics, ultimately fostering both innovation and inclusivity.

"People are the value creators. They are the power," said Fromm. By embracing inclusion as a strategic imperative, organizations can unlock their teams' full potential while driving long-term success.

Watch Fromm's full comments on People and Strategy:

Building an Inclusive Culture, with Shaw Industries' Mike Fromm

This article has been paid for by a third party. The views and opinions expressed are not those of Newsweek and are not an endorsement of the products, services or persons mentioned.