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Australia needs to fix management pipeline to get female CEOs

By Annalisa Haskell | April 30th, 2015

We keep lamenting and wringing our hands about Australia’s appalling progress on gender equality in the senior leadership of our companies’ boardrooms, business tables, small businesses, academic institutions and, even in my own local government industry, which is proudly focused on community representation.

No one debates that it seems odd there is a dearth of female talent at the top when we have, for quite a while, educated our girls at what appears to be an even faster rate than the boys. But one thing’s overlooked and it’s not rocket science.

In Australia today (and for some time) there is not anywhere near an equivalent pipeline of female managers, ie people responsible for operational line management decisions such as budgets, projects and people. There are a twice as many male managers than female managers.

It’s a fact that if there is less in the bottom, then there must be less at the top.

This is true even in local government, where we are committed to having community representation, diversity and supportive flexible work practices (under a hugely generous industrial relations framework). Our recent local government workforce results from what has been probably a world-first collaboration with my organisation, PwC and 80 NSW councils, quantitatively reinforces this picture. We already knew women were missing as councillors (23 per cent of all mayors and 30 per cent of all councillors nationally) – they are also missing from management.

You don’t get to the senior leadership heights if you have not travelled through lower and middle-management ranks first. That means getting the best talent into a first-time manager role and then promoting on merit into upper management. This requires focus and confidence in the skilled individual and commitment from organisations.

So why are Australia’s gender pipelines very different sizes?

INDUSTRY FOCUS

Goldman Sachs and JB Were’s 2009 report, Australia’s Hidden Resource: The Economic Case for Female Participation, quantified startling realities and it has little to do with the fact many women become parents at a time their careers take off. Women all around the world have children and a lot more of them are leading international business and government when compared with Australia.

The facts are: Australian women are overly concentrated in very specific industries – education and training, health and social assistance, and retail, and are only half as likely to become managers (despite them being equally likely to be in full-time roles in a professional capacity).

Management skills are a fundamental stepping stone to leadership. It builds confidence and competency in: decision-making, resource management, self-accountability. It’s also competitive and requires effective communication skills and emotional intelligence. Managing and motivating others different to you, builds personal and professional resilience. So if women are not there to start with, then they miss this critical development and will continue to be relegated to “support roles”.

This is the unspoken issue of the talent debate missing.

In NSW local government, not only do we see mirror images of low female managers (31 per cent), it’s lower again in the larger, complex and asset-intensive councils (28 per cent). Precisely where there should be more opportunity, there is less, which seems counter-intuitive.

FACTORS

What’s going wrong and when? The answer may lie in a combination of environmental factors.

Children live up to expectations. Are we setting equally high expectations of our daughters as our sons? It’s clear it is the girls that are not completing the foundation subjects such as year 12 maths, which is in worrying relative decline.

Are we ensuring girls are making highly strategic, as opposed to convenient or safe, career choices? Are they being set to build transferable skills for the longer term? Are they properly being informed and considering the risks and trade-offs of industry choices (high vs low paid) and subjects (breadth vs specialist)? And why are we so keen to: a) push the merits of fitting careers around having families, rather than force the adult discussion (finally!) as to how childcare system is a necessary support for everyone’s careers or b) sell the populist “work part time” mantra. Anyone with business experience knows its career suicide unless you are in enviable positions of having built some professional power (for example, an experienced lawyer) or you are lucky to work for a large, enlightened, Australian company or multinational. Both are rare.

Serious career-planning to build transferable skills over the long term needs to be the focus. Continuing to pat ourselves on the back about how well we educate our women is just not addressing the absence of skilled women across our varied industries. But the most worrying thing, regardless, is the alarming, continued over-representation of our working, skilled women in support functions and not line management.

Let’s stop lamenting and get cracking. Parents, schools, universities, business and government need take responsibility to plug the gap together for the future economic and social health of our girls and our economic and social future.

Annalisa Haskell is chief executive officer of the Local Government Professionals Australia, NSW, and a director of YMCA NSW.

This article was originally published at the AFR here.

Sectors: Business

Quotas will put women of merit in top jobs

By Carol Schwartz AM | January 16th, 2015

Once again, we are treated to the oft-repeated views of Australia’s captains of industry that we don’t need quotas to lift the number of women in senior roles in Australia.

“Optional targets”, “encouragement”, “strong support” will achieve the same result. (Chanticleer CEO survey, AFR, January 6).

It’s puzzling that our business leaders are still so hesitant about following the vast array of evidence which points to the higher performance ratings and positive business outcomes of diversity.

“We see workforce diversity as essential to sustaining Optus’ competitive advantage,” CEO Allen Lew says.

So why the ambivalence? It’s not like our captains of industry don’t recognise there’s a problem. In fact, a number of those interviewed are members of Liz Broderick’s Male Champions of Change, a group absolutely convinced of the business imperative to include more women in senior roles and who ask themselves, “50/50, if not, why not?”

“We need to start treating this like any other business critical issue where you would develop a strategy to fix the problem,” says Mike Smith, CEO of ANZ.

Well, here’s a strategy that’s proven to work – quotas. In fact, it can be argued that they are the single strategy that does work in creating the desperately needed paradigm shift to increase diversity.

They worked in Norway, where quotas lifted the number of women on company boards from 7 per cent in 2003 to 40.5 per cent today.

They worked in the Australian Labor Party, where adoption of an affirmative action quota saw the numbers of women soar from 14.5 per cent in 1994 to 35.6 per cent 17 years later. This enabled Julia Gillard as prime minister to choose her record eight women ministers (five in Cabinet) from a pool of well-experienced women. Under Tony Abbott’s Liberal Party – no quotas – we are expected to celebrate the doubling of the number of women in Cabinet from one to two.

So why is there this vehement opposition to quotas when they so obviously work?

Perhaps the word “quota” has various connotations of unqualified minority groups being thrust undeservedly into positions of power? Well, nothing could be further from the truth. Women are not a minority in our modern Western societies. We are equal partners and contributors within our communities. Nor are we a minority when it comes to academic qualification, with women now outnumbering men “from bachelor degrees to the top doctoral peaks” (Geoff Maslen, SMH, Nov 25, 2013).

If it is the terminology, then let’s be creative about finding alternatives.

Of course, beyond just words, we also have to deal with the pervasive assumption that quotas are inherently “anti-merit”.

“We strongly support merit-based promotion”, says David Thodey, CEO of Telstra.

Who doesn’t?

The issue of male dominance in senior roles, be it in business or politics, is not one of lack of talent or merit on the part of women. This was the very clear experience of Martin Parkinson, past head of Treasury, when he introduced his “Progressing Women Initiative” to ensure equality of opportunity for leadership roles in Treasury. A firm target of 35 per cent women in leadership was set. Parkinson knew that it was most certainly no lack of ability or merit that was holding women back. It was the systemic influences within the department that needed radical change. His program has been an undeniable success.

Many of those interviewed by The Australian Financial Review also pointed to societal issues, particularly family and caring responsibilities, as playing a big part in creating the gender gap problem. But what better way to confront a problem and force a solution than to mandate change?

So yes, let’s do all the other things – let’s look at childcare and caring responsibilities, the pipeline, the mentoring, the unconscious bias, our employment practices. Let’s report on how we’re all doing.

But, fundamentally, we must all come to terms with the fact that quotas and merit are not mutually exclusive concepts. Which CEO is going to appoint an inappropriate or unqualified applicant to a role? As business leaders, we all want to bask in the success of the people we work with – they make us look good.

All the research over the past two decades tells us that diverse teams produce the best outcomes for business.

So let’s change the language. Let’s deal with the structures. But let’s hold ourselves to account – let’s give quotas a go.

Carol Schwartz is a director on the boards of Stockland and the Bank of Melbourne.

This article was originally published at the AFR: http://t.co/9lgkiKB4By

 

Sectors: Business