Gender diversity isn't just an equality issue - it can really pay off
The economic case for diversity in the workplace is compelling - it's a financial imperative for firms that want to prosper
Achieving gender balance on boards and in management teams is a financial issue, not a social issue. There is a growing body of evidence to support the argument that more diverse boards and management teams are more effective than "identikit" teams in delivering better decision-making, and that increased diversity at board and management levels helps improve financial performance.
McKinsey's recent research shows that European companies in the top quartile for gender diversity are 15pc more likely to have financial returns above their respective national industry medians; and its Power of Parity report finds that $12trn (€10.9trn) could be added to global GDP by 2025 by advancing women's equality.
So if the economic case for diversity is so compelling and the benefits so numerous - reduction in groupthink, widening of the talent pool, better representation and understanding of customers, workforce and geographic footprint, etc - why are we not seeing accelerated progress? In Ireland, women make up only 12pc of the boards and 22pc of executive directors of listed companies.
The fact is that efforts really need to be broadened out beyond the boardroom to the executive level and the pipeline beneath that. This is important for two reasons: firstly because diversity at board level can only be improved and made sustainable by having a robust pipeline of diverse candidates, and secondly - and perhaps most importantly - because the executive leadership is where organisational culture can most readily be influenced by those in decision-making roles.
There are a number of things companies can do to start driving change within a relatively short time, from being thoughtful about language used (why do we only ever hear about "working mothers"? What about "working fathers"?) and behaviour exhibited within the workplace; to calling out unacceptable conduct; to removing gendered language from job adverts, and stripping CVs of demographic information. Simple techniques which nudge people to behave in a fairer way are critical to removing prejudice in the workplace and bringing unconscious bias training to life.
The bigger challenge for companies is ensuring that they have fair and equitable recruitment and promotion processes. If, for example, 30pc of a company's manager pool is female, then the number of women promoted to the next rank should - all things being equal - match that percentage.
Unfortunately, what often happens in practice is that businesses get derailed by the belief that they have a merit-based system which turns out not to be so meritocratic after all.
Indeed, the concept of "merit" often backfires as managers believe they are selecting the best person for the role but are, in fact, favouring individuals who look and sound like them, where merit translates into the qualities that they personally admire and recognise. In fact, those who shout loudest about operating in a meritocratic way are often the worst offenders, as they are the least likely to challenge their decisions.
We need a shift in the way organisations think about talent management - there is no "normal'" there are many different styles and faces of successful leaders. Good managers know how to develop and encourage all of their team members.
Transparency is another key driver to improving gender balance. The best companies have robust and transparent reporting of gender composition at all levels. They also collect and report on the most relevant data. I know of one large bank that discovered women at vice-president level spent six more years in a role before promotion compared to their male counterparts.
Indeed metrics, as well as voluntary targets, are both valuable tools for creating a disciplined approach to gender balance and cultural change in organisations. A few progressive companies are already leading the way on internal targets - BHP Billiton announced that it's looking for women to make up 50pc of its workforce by 2025, while Legal & General has set itself a target of 50pc women by 2020.
The 30% Club has its own aspirational targets and, here in Ireland, our goal is to have a minimum of 30pc women on the boards of listed companies and at executive management level by 2020. If we are to reach these stretch-targets, we need businesses - as well as men and women themselves - to work together to effect change.
Brenda Trenowden is the Global Chair of The 30% Club and leads ANZ's Financial Institutions Group in Europe. She is the keynote speaker on Wednesday at the Student Managed Fund's Women in Business event at Trinity College Dublin - see www.trinitysmf.com for more details
Sunday Indo Business