Why gender diversity matters
In 2017 Boston Consulting Group (BCG) produced a report that stressed the following findings:
1. There is a positive relationship between management diversity and innovation, which is statistically significant, meaning that companies with higher levels of diversity get more revenue from new products and services.
2. Management diversity seems to have a particularly positive effect on innovation at complex companies—those that have multiple product lines or that operate in multiple industry segments.
3. To reach its potential, gender diversity needs to go beyond tokenism. The BCG study stressed that innovation performance only increased significantly when the workforce included a nontrivial percentage of women (more than 20%) in management positions. What is key here is that the study states that having a high percentage of female employees doesn’t do anything for innovation if only a small number of women are managers.
This work supports a 2012 research study by Mckinsey and Co. which found that of companies ranking in the top quartile of executive board diversity, ROEs were 53 percent higher, on average, than they were for those in the bottom quartile. At the same time, EBIT margins at the most diverse companies were 14 percent higher, on average, than those of the least diverse companies. Further A study by the global non-for-profit Catalyst found that companies with the most women board directors outperformed those with the least on return on sales (ROS) by 16 percent and return on invested capital (ROIC) by 26 percent.
Finally, research by Professor Scott E.Page from the University of Michigan challenges traditional assumptions about decision-making by demonstrating how the power of difference can help organisation’s to avoid the pitfalls of Groupthink and learn how to innovate and grow through utilising an organisation’s collective wisdom. What this research also highlights is that it is ‘diversity of thought’, enabled partly by gender that facilitates these benefits.
The nature of gender bias at work
Psychologists refer to unconscious biases as our unintentional people preferences that result from the processes of socialisation and social categorisation. Research has demonstrated that when the unconscious brain sees two things occurring together (for example, women and child caring roles) it begins to wire these associations together neurally. Constant exposure to images and stories of women in child caring roles via the media, home situations, personal encounters and work environments re-enforce these neuro connections resulting in what is often referred to as ‘soft-wired’ bias.
The issue of gender diversity, is complex, although when we examine the issues closer a number of themes that hinder women’s progression do emerge. In a Harvard Business Review paper entitled Women Rising: The Unseen Barriers Herminia Ibarra and colleagues identify the often subtle ‘second-generation’ forms of workplace gender bias. Amongst the most prevalent forms of second-generation gender bias are:
- A paucity of role models for women: Women simply do not have the number of senior role models in the same way as their male colleagues moving up the organisational pipeline do. The lack of visible role models sends negative messages to both male and female talent about the roles and positions of women in organisations.
- Gendered career paths: Despite efforts through flexible and agile working practices, current organisational structures and working patterns continue to fit more easily around men’s lives. The idea of a (female) supporting spouse is prevalent in many work sectors from legal, professional services and sales.
- Women’s lack of access to networks and sponsors: Men in positions of power tend to provide direct development opportunities to junior men, often through direct sponsorship. Junior men are also more likely to have access to informal mentors and thus women’s connections tend to be less efficacious.
- Double binds: The types of attributes we ascribe to the ideal leader in most organisations are closely linked to positive male characteristics: decisive, assertive and independent. A number of research studies have shown that women who excel in traditional male domains may be viewed as competent, but when they demonstrate similar leadership traits, they are seen as less likeable to their male colleagues. In short, the types of behaviours that we often value in men such as self-confidence appears as arrogance in women.
In addition to these four types of ‘second-generation’ gender bias as described by Ibarra, Susie Babani, the Chief Human Resources Officer at ANZ , suggests that understanding benevolent bias is key to identify the root causes of the glass ceiling. Collectively these types of gender biases create a culture of exclusion without intention. And thus, as described by Avivah Wittenbery-Cox in a recent HBR article, it’s the cultures that need to change.
Promoting gender inclusion: What works?
In What Works: Gender Equality by Design, Iris Bonnet, highlights a number of ways in which organisations can reduce bias and work towards promoting greater gender inclusion. These include:
1. Employing people analytics: Collect, track and analyse data to identify trends and patterns covering a wide range of decision-making areas from hiring to project allocation, time with senior leaders or time with clients (formal and informal). Tracking to identify gender bias at each stage of decision-making processes helps organisations to identify issues and then put into place mitigation programmes.
2. Reviews and checklists for decision-making: Research tells us that using checklists for decision-making helps to mitigate bias in a number of areas. Organisations should therefore:
- Introduce ‘Blind’ decision-making across a range of people decisions
- Review job descriptions, person specifications & leadership assessment criteria
- Agree a set of decision-making criteria / questions
- Use a scoring system for talent selection programmes
- Introduce neutral observers across a range of decision-making areas, including recruitment, performance reviews and talent selection
3. Change the default by making agile working the norm: As long as we continue to operate under the current flexible working model women will continue to face gender benevolent bias and other forms of systemic bias. Address this by:
- Making agile working part of the wider company culture
- Re-position the debate by engaging and encouraging men and other leaders to ‘leave loudly’. (PepsiCo Australia and New Zealand)
4. Role models matter: Use male and female role models to challenge traditional viewpoints E.g. those working flexible hours are less ambitious or motivated. Also the more we become exposed to senior women leaders the more we expect to see women as leaders / leaders as women, thus breaking the think manager / think male bias and also the Double Binds.
Businesses should also ensure they have portraits of successful women in their meeting rooms, in recruitment campaigns, annual reports and as speakers in Town Hall meetings. They should rotate presentational slots with gender in mind.
5. Challenge group norms: Consciously work toward gender balance in team meetings, on client project teams, at client pitches. Don’t play the game of tokenism. Ensure women are given the same airtime as their male counter-parts. Organisations should also introduce rules for inclusive decision-making, such as asking for ideas on paper / e-mails before meetings, adopt the principle of Amplification, and questioning for instance all male conference panels, client teams or speaking opportunities.
6. Increase transparency in decision-making: Sharing information on gender inclusion at work increases accountability
and is likely to affect behaviours as well as decision-making. Individuals who know that they are likely to be held accountable for their own decisions are more likely to adopt inclusive decision-making. Introduce a range of targets and KPIs and ask department heads to publish data on gender recruitment, retention and promotions.
About the Author:
Dan Robertson is the Director of Vercidaconsulting.com
He is highly respected as a subject matter expert on workplace diversity & inclusion management, unconscious bias and inclusive leadership.