The slow pace of change in gender diversity at a leadership level indicates there needs to be a shift in NZ’s business culture.
We may have a young, female Prime Minister, but in business there is a lack of gender balance in senior leadership. Grant Thornton International’s 2018 Women in Business Report revealed that the female proportion of senior management teams in New Zealand has hit an all time low of 18% since the report began in 2004 (31%), compared to 20% in 2017. What is more discouraging is the marked increase in the number of businesses with no women in senior management roles at 56%, compared to 37% last year and a general sense of complacency creeping in. The public sector has achieved nearly 46% of gender balance, it’s time the private sector upped its game.
Although many businesses adopt gender balancing policies and practices, this does not always lead to or motivate significant change. This month, Minister for Women, Julie Anne Genter, laid down a challenge for the private sector to make progress, indicating that the Government may need to introduce incentives if things don’t improve. For change to happen it needs to be driven from the top; business leaders need to focus on creating an inclusive culture where everyone feels that they are valued and where their voices can be heard.
Some of the major benefits of gender balance in businesses are they can handle the disruption facing every industry, make better decisions and are more resilient. Research Grant Thornton conducted in 2016 revealed that companies with diverse executive Boards offer higher returns on investment compared with those run solely by all-males. The study covered listed companies in India, UK and US and estimates the opportunity cost for companies with male-only executive Boards (in terms of lower returns on assets) at a staggering US$655 billion in 2014.
So how can you increase gender diversity? Here’s 10 recommendations business leaders can adopt:
- Champion the cause: this is the foundation to making inroads to gender diversity. Senior leadership need to take the issue seriously and lead from the top.
- Make diversity and inclusion a core value: organisational values drive behaviour, so it’s important the whole business is signed up to diversity and inclusion. Translating good intentions into practice is an ongoing challenge for businesses.
- Set goals: making gender diversity a core value is not enough in itself; business leaders should set clear goals by which they will measure progress.
- Set up balanced scorecards: they say that what gets measured gets managed, so business leaders should make diversity and inclusion goals part of the leadership team’s compensation packages to encourage change.
- Avoid tokenism: simply putting one woman in the senior management team is not enough to ensure a range of voices is heard, and for the business to reap the rewards of diversity.
- Reduce ‘mini me’ recruitment and promotion: it’s easy for both men and women to inadvertently recruit and promote other men and women. It takes courage from leaders to choose diversity. Providing support to understand why this happens and how it can be avoided will forge a better process. Unconscious bias training can help people at all levels of the business avoid the temptation to hire and promote employees who look, speak and think in the same ways.
- Introduce sponsorship: sponsorship can have a significantly greater impact on gender diversity in leadership than simple mentoring schemes.
- Investigate the benefits: evidence of the commercial gains brought by gender diversity will help convince sceptics of the need for change and provide justification for investment in new initiatives.
- Be comfortable with discomfort: creating an inclusive business environment that supports gender diversity in leadership will not be easy, so leaders need to be in it for the long haul. A key to this is a change in attitudes, then real progress will be seen. A willingness to talk about gender diversity will help drive any change; good leaders will spend time with their employees listening and interacting with them to try and dismantle the barriers to openness and honesty.
- Share your story: business leaders should be open about what is driving change in their own companies and encourage others and help them overcome the complexity of turning theory into action. It can be challenging for business leaders to feel like they can be transparent about internal ways of working, and particularly about mistakes they’ve made. But without this, we are unlikely to see widespread progress.
If in doubt, it always helps to get a fresh perspective about your organisation’s culture by seeking independent expert business advice; a balanced approach is key to exploring opportunities that foster diverse teams that are resilient and collaborative. From exploring your strategic growth options and understanding how to manage risk and opportunity, to getting the best from talent, specialist support can help you thrive in a fast changing business environment.