Will the glass ceiling ever break?
“There were t-shirts printed for little boys and little girls,” said Facebook COO Sheryl Sandberg on stage at the “Women in Economic Decision-Making” debate in Davos this year.
“The ones for boys said ‘smart like daddy,’ the ones for girls said ‘pretty like mommy’. I would love to say that was 1951, but it was last year—in the United States.”
Sandberg has become something of an icon when it comes to equality in the workplace. She is regularly voted as one of the most powerful women in business, she graced the cover of Time Magazine last week for the first time and is about to release her first book, Lean In.
“The goal in writing Lean In is to change the conversation around women from what women can’t do, to what they can do,” says publisher WH Allen. “Women have made so many advances on the road to equality, but the unfortunate fact is that over the past decade, while girls continue to outperform boys in school, there has been no progress for women in leadership roles.”
But it’s not just Sandberg banging the drum for women on boards and in executive positions. The topic has been reignited over the past few months.
Christine Lagarde, arguably one of the most important figures in the economic recovery of the Eurozone, has been heavily quoted of late. She recently complained that women often only get promoted to riskier leadership roles, stating “women generally get the job when it’s … a basket case, a lost cause – and they turn it around,” she said while being interviewed at Davos. The obvious example of her own role, an unmentioned piece of evidence.
She also gave her opinion on the quota debate. While in favor of the European Commission’s quota proposal, Lagarde said that “the suggestion to reach a 40% quota of women on boards by 2020 is a bit too high, considering the current number of women on boards, which is around 11%.”
The quota debate is a fiery one. The Welsh Government recently announced that it is seeking to introduce a 40% quota for women on public sector boards. The idea of enforced quotas has split opinions among the business community but as of yet, Westminster and many of the country’s largest corporations remain opposed to passing a law.
“The introduction of quotas doesn’t address the root cause for the lack of visibility of women in board level positions,” says Yvonne Smyth, director, Hays, the leading recruiting expert.
“Securing more equality in executive board positions requires an organisation and the wider society to address the complex cultural, personal and economic challenges a women typically has to face during the course of her career.
“The focus should be on taking positive action to enable women to take up leadership positions giving them relevant experience but at the same time supporting them to accommodate their personal commitments.”
Giving women the skills they need to go for and be accepted for board positions is an essential element in the struggle to even-up the boardroom balance. Mentore is a new support organisation which aims to work with companies to identify and develop more women into senior leadership roles. With Karren Brady, Sir Charles Dunstone and Sir Roger Carr among the participating mentors, the organisation has given renewed vigour to the wider debate.
“We work with corporates to build a pipeline of suitable women below the executive roles so that they can build on promoting them internally and when it comes to appointing board members there is a pool of female talent ready,” says Emma Avignon, CEO, Mentore.
“We work with the corporates to identify who needs mentoring, carefully match that person with one of our high calibre business mentors and put together a programme of coaching and development.”
Another important programme aiming to bring more women to senior positions is the 30% Club. Founded by Helena Morrissey, CEO of Newton Investment Management in 2010, it also works with businesses to bring about change – aiming for the eponymous “30%” women on boards goal.
Although there is a long way to go to finding the balance, there have been positive changes noted in the corporate world. Women now make up 17.4% of FTSE 100 board positions and 12% of FTSE 250 positions – it might not seem too high but that figure is up by nearly a half since Lord Davies’ report into women on boards was released some 18 months ago. Large corporates are making a concerted effort to address the imbalance.
“Aviva aims to attract and retain the best talent available for our operations around the world. To this end, we are committed to achieving balanced leadership, and our commitment to diversity results in better business decisions and high performance throughout the organisation,” says Marie Sigsworth, corporate responsibility director, Aviva.
“Our Group Executive Committee has four female members, which is 29% representation, and 22% of our top 400 senior managers are women. Aviva has signed up to The 30 Percent Club to help maintain a minimum of 30% female board representation by 2015.”
A report by The Ashton Partnership revealed that companies are accepting non-executive board members with a wider range of experiences than previously therefore widening their pool of potential members. Accepting female non-execs from the public sector, professional services, HR, marketing and the not-for-profit sector as well as the traditionally male-dominated finance is certainly a step in the right direction.
“One of the biggest issues when looking to appoint seniors positions is that unless someone has board level experience they can’t get on a board. Non-exec experience is helpful in giving women the experience they need and we are seeing significant steps in this regard but it will be important to ensure that those non-exec positions go on to full executive appointments,” says Smyth.
The level of attention currently given to finding a gender balance in the boardroom is huge, but why some might ask, is it so important?
Credit Suisse recently carried out a significant research into the topic in a bid to find out if there was a direct link between gender diversity on boards and corporate performance. The answer, according to their research was yes.
The company monitored 2,360 companies globally over six years and found that on average, you were better to invest in companies with women on their management boards than without. It also found that companies with one or more women on the board delivered higher average returns on equity, lower gearing and better average growth over the six years.
Interestingly, it found that the difference in share price between companies with or without women was minimal before the 2008 crash but as the economy deteriorated and volatility increased companies with women on board fared better. Which goes back to Christine Lagarde’s point – women do well in a crisis.
The report suggested seven reasons for companies faring better with women on boards. They were as follows:
1. Companies that are already doing well tend to promote women to boards.
2. Board members where there is gender balance tend to put in greater effort
3. There is a better mix of leadership skills
4. There is access to a wider pool of talent
5. A balanced board better reflects the consumer decision maker
6. There is improved corporate governance
7. There tends to be higher risk aversion
These are all pretty persuasive arguments and the research compounds the opinion that women on boards do have a massive impact on a company’s bottom line, organisations would be mad not to act.
Hopefully we can look towards a future with more Sheryl Sandbergs, an understanding and strong belief in the benefits women can bring to boards and we can wave goodbye to the kind of gender stereotyping Sandberg came across o
n those t-shirts.
Infographic: men vs. women
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