Half of organisations want regulation to boost gender diversity
Irish executives think more regulation is needed to force greater gender balance at the higher levels of businesses.
According to research carried out by professional services firm EY, just under half of those surveyed were in favour of regulation as a driver for creating more diverse and inclusive organisations.
Over the past 12 months there has been a lack of gender diversity progress on company boards and in senior leadership roles, with the research finding that there was just over a quarter of women on boards, and fewer than one in three women were represented in senior management in 2017, an increase of just 1pc and 2pc respectively in 12 months.
Given this, it is perhaps unsurprising that managers are calling for increased regulation in this area.
It is particularly noteworthy that the research - carried out among more than 150 senior leaders across a range of indigenous, multinational and public sector organisations - found that of the 49pc in favour of regulation to address diversity, almost eight in 10 people said that they favour regulation to address gender diversity of boards.
Meanwhile nine in 10 people in this group said that they favoured legislation to address the gender pay gap.
"With gender pay gap legislation on the government agenda, it's encouraging to see that many Irish businesses are supportive of the move," Olivia McEvoy, director of diversity and inclusion advisory service at EY Ireland, said.
However, in line with the findings of the report, Ms MsEvoy warned that diversity at board levels is an issue that is not improving.
"It is clear from the findings that organisations in Ireland emphatically acknowledge diversity and inclusion as a business imperative. However, actual progress and work practices do not entirely reflect that view," she said.
This, she continued, seemed in part due to a failure to make a connection between diversity and inclusion (D&I) and a company's bottom line.
However, there are signs that organisations are spending more money in the area of diversity and inclusion.
The number of companies investing €1,000 per year or less in diversity and inclusion has decreased to 20pc this year, from 36pc last year, and there has been a jump in the number of businesses investing €50,000 per year in the area, increasing to 15pc in 2018, from 9pc in 2017.
Companies are largely spending their investment in this area in two ways; on events, which accounted for diversity and inclusion spending among just over three in four firms, and sponsorship, which accounted for diversity and inclusion spending in 42pc of firms.
Less than a fifth of companies are investing in strategy development, a similar proportion (19pc) in strategy implementation, and less than a third are spending money in data collection and analysis in respect of gender diversity and inclusion, the report found.
"While it's encouraging to see that investment in D&I is increasing, investing in events and sponsorships alone will simply not drive business performance," Ms MsEvoy said. "An effective diversity and inclusion programme requires governance and executive sponsorship as well as an informed leadership who are held accountable for that success. It is essential to have an evidence base for D&I, setting specific goals and targets and measuring success and progress, achieved through diagnostics and data analytics."
Of the firms that have invested in a diversity and inclusion assessment, they said that they were three times more likely to attribute higher sales revenue and profit margins to diversity and inclusion than those who haven't carried out a diagnostic assessment. The findings reflect the views of C-suite leaders, HR directors, and diversity leads.