8 March was International Women’s Day and in this issue we concentrate on how increasing gender diversity in organisations can boost performance. Let us as a community target 8 March 2020 as a cut-off date to bring about meaningful change for gender diversity in the organisations in which we work. We should start planning ahead and form work groups and communities to execute and showcase the efforts our organizations are putting into this agenda. This 2020 target is 1 of 5 changes ACCA is calling for; the others being (i) closing the pay gap between men and women, (ii) eliminating gender inequality by measuring and reporting on gender stats, (iii) committing to training and development to create equality in the pipeline and (iv) looking at and mirroring the success stories of societies that are benefiting from gender equality.
There are two studies one can cite here; the first is the study by the Credit Suisse Research Institute (2014) considered the gender mix in over 3,000 companies across the key senior management roles of CEO, CFO, Operations and Shared Services. It shows that companies where women accounted for more than 15% of senior management achieved average return on equity of 14.7% in 2013, compared with 9.7% achieved by companies where women constituted fewer than 10% of senior managers. The second study by McKinsey shows that companies with the highest share of women on their executive committees outperform companies with all-male committees by 41% in terms of return on equity, and by 56% in their operating results (EBIT margin1) (McKinsey & Company 2010). McKinsey suggests that this could be because they exhibit some different leadership behaviors that complement those of men.
Gender data is easily the most readily available data that can be collected in organizations. Both HR and Finance can collaborate to develop and report on metrics that show how men and women in the workplace are performing in a meaningful way. These exercises can then be built upon to show how diversity can add to shareholder and stakeholder value. These are not just words when one views people as a fundamental value adding capital that is able to add to the net financial capital as well as the firm’s social and relationship stock.
A look at the World Bank gender portal
tells us that for MENA the percentage of women in the labour force has been between 20% and 30% for the last 14 years, unemployment amongst the women labor force is 20.4% compared to 8.8% in men in 2014. These figures speak for themselves of the task ahead. In South Asia the picture is better with percentage of women in the labour force fairly constant at 40% over the last 14 years, a best of 45% in 2005 and in 2014 closing at 38.9% again we need to urgently adopt gender diversity policies and practices.
Let me end with a quote from the above website:
“No country, community, or economy can achieve its potential or meet the challenges of the 21st century without the full and equal participation of women and men, girls and boys. Failure to fully unleash women’s productive potential represents a major missed opportunity with significant consequences for individuals, families, and economies.”