Inclusiveness and psychological safety are mutually interdependent: one cannot exist without the presence of the other.
Both are created when inclusive leadership embodies the mindsets, behaviors and cues that foster psychological safety as a cultural norm for the organization.
Psychological Distress In the Workplace
Exclusive work environments denigrate mental health and cause psychological distress.
Self-reported workplace bullying is a predictor of mental distress two years down the road. 40% of LGBT cis-gender employees and 60% of transgender employees still adopt “covering” behaviors in the workplace to avoid harassment and discrimination. Microaggressions and racial discrimination impact upon stress-related cortisol levels, hinder quality of sleep, and negatively affect mental health, causing symptoms of anxiety and depression. Among black women who report experiencing more incidents of racism, the trauma impact shows up visibly in functional MRI brain scans as greater response activity in the regions associated with vigilance and anticipating an incoming threat, a threat to long term health.
One study showed that while exclusion (or ostracism) is rated as more benign than bullying or harassment, it is both more common and more damaging to physical and mental health. People consistently rated ignoring, excluding and overlooking a co-worker as less egregious than belittling, teasing or gossiping; it’s also easier to claim lack of intent when it comes to excluding others. Yet, exclusion is significantly more likely to lead to job dissatisfaction, health problems and resignations than bullying or harassment. People who experience exclusion have a more diminished sense of workplace belonging, commitment and engagement, and are more likely to quit.
On the other hand, the impact of inclusive leadership on curbing psychological distress and creating psychological safety has been demonstrated even amidst trauma and crisis. A three-wave study was conducted among over 400 nurses across five hospitals in Wuhan during the Covid-19 outbreak period of January - April 2020 - nurses who faced both loss of patients and risk of infection. The researchers found that inclusive leadership contributed significantly to creating psychological safety, and decreased psychological distress - explaining 74% of variance in psychological distress levels.
The Business Case for Psychological Safety
Being psychologically safe is essential for people’s mental health and well-being. Psychological safety is also, as previously highlighted, a performance matter for your organization - impacting individual, team and organizational effectiveness.
When psychological safety is present, employees are free of interpersonal fear and more able to take risks, vocalize opinions, provide challenges to the group consensus, give critical feedback, question the status quo and speak up with novel and unconventional ideas: without anticipating negative consequences to themselves, their team status or their career. Psychological safety creates an organizational learning culture, which supports asking for help, as well as allows the trial and error that often leads to innovation. Improving psychological safety has an even greater impact on employees whose voices have been historically underrepresented - and underweighted - around the brainstorming and decision table.
Google has found that psychological safety is by far the most important predictor of team effectiveness, significantly more so than who is on the team. A strong degree of psychological safety is fundamental to building a network of teams that can be agile in collaborating outside of team silos and tackling complex problems. The Australian HR Institute found that businesses with diverse leadership teams, diverse work forces and psychological safety increases financial results by 35% and revenue by 19%, improve new market entry by 70% and reduce risk by 30%.
When it comes to engagement and motivation, 93% of workers in Australia indicated their physical, emotional and mental well-being was as important as their pay grade. The research found improving an employee’s well-being by 1/2 point on a five-point scale equals $2,500-$3,500 benefits in creativity, collaboration, productivity and retention.
How Inclusive Leaders Set the Tone for a Psychologically Safe Environment
The prerequisite of a psychologically safe environment is that people are able to be their authentic selves without feeling they are put at risk by self-disclosure. Without the culture of inclusion that values and welcomes diverse perspectives, psychological safety is out.
The most important driver for team psychological safety is a positive team environment - where members value each other’s contributions, care about each other’s well-being and are able to input into the way the team conducts itself. Above all, visible role-modeling of inclusive leadership mindsets and behaviors at the very top has the greatest impact on creating psychological safety in an organization: reinforcing expectations and setting a cultural tone of inclusion.
Dr. Timothy Clark writes that psychological safety enables an organization to increase intellectual friction while decreasing social friction. Inclusive leaders can foster psychologically safety by practices such as promoting transparency, creating connection, showing curiosity about individuals, inviting unheard perspectives, actively listening, showing vulnerability, demonstrating learning from your own mistakes, spotlighting the talents of others, adopting a coaching mentality, facilitating candid conversations, encouraging and normalizing constructive tension and differing opinions, giving clear expectations and feedback, asking clarifying questions, showing trust, taking personal accountability, setting supportive work/life boundaries and emphasizing well-being.
McKinsey has found that the traditional authoritative leadership approach, which has become increasingly redundant since the pandemic, is damaging to psychological safety. On the other hand, consultative (consulting team members, soliciting input, considering everyone’s views) and supportive leadership behaviors (showing concern and support for team members as individuals not only employees) encourage psychological safety and cultivate positive team climates; the former directly creates psychological safety; both encourage team members to support each other and indirectly create team psychological safety. When there is firstly a foundation of a positive team environment in place, challenging (but essential) leadership behaviors that ask team members to stretch together and result in enhanced psychological safety.
When senior leaders demonstrate inclusiveness and the leadership behaviors that support psychologically safety, others leaders at various levels in the organization pick up the cues and are more likely to emulate them. It’s recommended that cross-level leadership development focus on developing core skills that contribute to psychological safety: common skills such as facilitating open-dialogue and managing tension and also less commonly taught skills such as sponsorship training, developing situational humility and a growth mindset.
Senior leaders set the tone through embodying the behaviors and cues for leaders and managers in the organization, and then team leaders at all levels echo the cues for team members, creating an expanding interwoven net of psychological safety.