Posts Tagged ‘Quotas’
Equality Down Under
Last month, Catalyst’s Debbie Soon, Senior Vice President, Strategy & Marketing, headed “Down Under” to meet with leaders committed to diversifying Australian workplaces. In today’s guest-post, she outlines the lay of the land around gender diversity—including the challenges and opportunities—in a country known for its male-driven “blokey” culture.
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I recently returned from Australia, visiting a number of Catalyst members, partners, and colleagues (and discovering some of the most interesting wildlife I have ever seen—did you know that a cassowary is the most dangerous bird in the world?!)
Birds aside, I found that the Australian economy is vibrant and businesses are buzzing. Within corporations, in the news, and even in Parliament, the phrase “unconscious bias” seems to be at the forefront of conversations about gender diversity. Who would have thought to look “Down Under” for an example of how to mobilize a country to embrace gender diversity in the boardroom and throughout the business environment?
By 2013, all companies with 100 or more employees must report their gender statistics to the Equal Opportunity for Women in the Workplace Agency (EOWA), Catalyst’s census partner in Australia, which will compile the data and report the results to the Australian Parliament. Are companies taking this reporting requirement seriously? You bet!
No one wants to see government mandates. (Been there, done that—don’t want to do that again!) So, businesses are taking matters into their own hands and proactively seeking ways to improve their company images and their workplaces to better appeal to women and to ensure that women stay and advance through the ranks.
Corporations appear to understand that it’s their responsibility to reach out to women, starting with the top. According to the Australian Institute of Company Directors—which partnered with the Australian government to implement mentoring, coaching, and education programs for women aspiring to board positions—29% of all new appointments to ASX 200 boards so far in 2011 have been women, an improvement over the 25%, 8%, and 5% numbers in 2010, 2009, and 2008, respectively.
Whether this momentum will continue is yet to be seen. And what the organizational diversity numbers will be in 2013 when the first reports are due, is also yet to be seen. But this much is clear: Australian companies seem to be answering the gender diversity question, “If not, why not?” with the response, “Why not!”
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Debbie Soon is responsible for Catalyst’s business strategy and planning, market assessment, and overall marketing operations. For Catalyst’s entry into new markets, she sets priorities and develops the business model, entry strategy, and plan. In addition, she is responsible for brand management, corporate events, public affairs, IT, and Catalyst’s Corporate Board Services.
Debbie holds a B.A. in Mathematics from the University of California at San Diego and an M.B.A. from the Harvard Business School. She also completed special studies in Mathematics at Cambridge University, England. Ms. Soon is a member of the Executive Committee and Board of Advisors of DirectWomen Board Institute and a member of the Advisory Panel to the Diverse Director DataSource, a CalPERS/CalSTRS board diversity initiative.
C This
In European companies, face time still rules. While half of the women surveyed in our latest report, Unwritten Rules: Why Doing a Good Job Might Not Be Enough Europe, didn’t think working long hours was important, more than 83% said doing so was still key to advancement. “Workers may be told that you can work from wherever, but when they see that those advancing are in the office a lot, then there is a disconnect,” said Laura Sabattini, Director, Research, and author of the new report. Read about one novel solution to managing a culture of presentism—plus news from Australia and Canada—in this edition of C This.
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Use ‘Em or Lose ‘Em
Is it ethical for multinational corporations to swoop into foreign countries and hire talented women who are underutilized in the workforce? Yes! “Any time you can recruit talent it offers a company a competitive advantage,” said Lee E. Miller, Adjunct Professor at Columbia University. “If a country is not using its local female talent then it is in the women’s interest and the multinational’s interest to put that talent to use.”
READ: “The Gender Advantage for Multicultural Firms,” by Elizabeth Harrin, The Glass Hammer, 1/27/11
Can a well-placed jacket earn you respect in an office that over-values face time? It couldn’t hurt, insists Eleanor Tabi Haller-Jorden, Catalyst’s General Manager in Europe. Haller-Jorden told The New York Times about a little experiment conducted by a senior-level female executive in Europe. “She put her jacket on a chair and started leaving at a reasonable hour,” she said. “Yet people started coming up to her and saying she was putting in a fabulous amount of hours. She said the jacket was the best investment of €250 that she had ever made.”
READ: “The Codes That Need To Be Broken,” by Doreen Carvajal, The New York Times, 1/26/11
A 2010 World Economic Forum survey found that managers from 600 large companies believed that a “lack of role models” and “masculine or patriarchal corporate culture” were the chief obstacles women face at work. Companies across Europe have responded by shifting away from leadership and assertiveness training to instituting formal sponsorship and mentorship programs that pair women with powerful company leaders. “European companies are waking up,” said INSEAD’s Herminia Ibarra. “They are realizing that it’s really about changing the culture.”
READ: “For Women in the Workplace, an ‘Upgrade Problem,’” by Nicola Clark, The New York Times, 1/26/11
Only 3.8% of the CEOs in Canada’s top 500 businesses are women. Are quotas one possible solution? In this wide-ranging discussion featuring background information from Catalyst’s Deborah Gillis, Canadian Senator Celine Hervieux-Payette outlines a proposed bill that would force all publicly traded Canadian companies, banks, insurance companies and trust companies to ensure that at least 5% of their directors are women. Hervieux-Payette was also joined by Dave Gregory, former CEO of First Calgary Credit Union, and Amy Dittmar, Associate Professor of Finance at the Ross School of Business at the University of Michigan.
LISTEN: “Women in Boardrooms,” The Current, CBC Radio, 1/14/11
The Australian Securities Exchange (ASX) now requires member companies to set and report on targets for gender diversity at board and senior management level, add diversity indicators to senior management accountabilities, and establish programs to increase the pool of female candidates. With representation of women on ASX boards now roughly only 10%, the new rules are an important step to increasing awareness and transparency. “This year will tell whether rising awareness will force more assertive leadership,” wrote Steve Harris executive director of the Centre for Leadership and Public Interest at Swinburne University.
READ: “Find Room at the Top for Women,” by Steve Harris, The Australian, 1/27/11
Edit This!
New research into who creates and consumes content on Wikipedia raises more questions than it answers. A recent study found that barely 13% of Wikipedia’s articles are written by women. The site boasts more than 3.5 million articles in English and 17 million across all languages—each written and edited anonymously. Interestingly, women and men look for information on the site at similar rates. So why do fewer women contribute? Critics allege that women are less willing to assert their opinions in public, but if you ask me, I think women are simply too busy to spend their time anonymously updating the site without receiving any credit for their hard work. What do you think is behind the wiki-gap?
C This
A little-noticed provision in new U.S. legislation requires all federal financial agencies and firms to establish an Office of Minority and Women Inclusion to boost diversity. Banks and firms that fail to diversify their ranks do so at their own peril. According to the rule, failure to make “a good-faith effort to include minorities and women in their workforce” can result in cancelled government contracts. More on this ground-breaking provision in today’s C This.
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Laying Down the Law
Championed by California Democrat Maxine Waters, a powerful provision within U.S. financial reform legislation will hold federal agencies responsible for failing to diversify. “Firms must take steps to be more reflective of America,” said Michael Yaki of the U.S. Commission on Civil Rights. “This is a wake-up call for Wall Street.”
Stop, Think, Act
“Would I want my daughters working here?” It’s a simple question, but it stops many men in their tracks. “If the answer is no, then you should own part of the solution,” insists Deloitte’s Ann Weisberg.
CEOs Speak
What traits do more than 300 CEOS from 40 countries have in common? Researcher Robert Rosen endeavored to find out.
READ: “The Secret to Leadership Success,” by Harvey Schachter, The Globe and Mail, 8/9/10
A Deadly Figure
Since the start of this year, The New York Times has published 698 obituaries— and only 92 were of women. This statistic made Fast Company magazine cofounder Bill Taylor wonder “about who deserves such recognition in the first place, and what their stories might suggest about a life well-lived.”
READ: “The New York Times Is Dead Wrong,” by Bill Taylor, Harvard Business Review, 9/2/10
No Trend Here
New market research has found that single, childless women aged 22 to 30 earn, on average, 8% more than their male counterparts in many U.S. cities. Is this a cause for celebration? Not so fast. “This small slice of data is unlikely to be indicative of a larger, penetrating trend,” wrote DailyFinance’s Melly Alazraki.
READ: “Young Single Women Now Earn More Than Men,” by Melly Alazraki, Daily Finance, 9/1/10
Lessons From Norway
Guest blog by Morten Huse, Professor of Organization and Management, BI Norwegian School of Management and President of the European Academy of Management
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In Norway, 40% of the board members of publicly traded companies are women. That’s because they must be—by law.
Norway’s approach is considered progressive. Indeed, many call the country’s initiative the boldest move anywhere to address an issue that one author has flagged as “one of the most durable barriers to gender equality.” Not surprisingly, other countries are thinking about following in Norway’s footsteps. However, business leaders, politicians and women in these countries are first asking whether or not the legislative solution has in fact made a difference in Norway.
Several studies, including one that I recently undertook with co-author Sabina Nielsen, have been conducted to explore the following factors:
- The societal impact of power balance, democracy and culture
- The business impact relating to diversity, competence and critical mass
- The individual impact focusing on the glass ceiling, careers and tokenism
Simple answers about the law’s effectiveness are not yet possible. Before drawing conclusions, we need to understand and define aspects of value creation, including the tasks boards are to perform, plus the identities and behaviors of women board members compared with those of men board members. We also need to understand the effect of board processes, working styles and leadership.
In our study—based on responses to a questionnaire from 392 board members in 120 firms—my co-author and I did not find differences between women’s and men’s responses. We found that women directors may impact board involvement in strategic decision-making, but that the degree of impact depended upon the diverse values and professional experiences the women brought to board service as well as the perception of equality among the women and men board directors. Furthermore, we found that the degree of impact depended upon how the women used their knowledge and skills in the boardroom. Knowledge and diversity matter only if they are used, and many boards do not have processes or a leadership style that encourage the use of knowledge and skills.
That said, our study did show that the Norwegian law mandating a quota for women on boards has had a significant effect on how boards achieve their objectives. Members and their leaders have started to pay attention, not only to board composition, but also to the inner workings of boards. Moreover, we found that tokenism did not seem to be important for newly elected women who feel they are as influential as their male counterparts and considered as equals.
Finally, our research revealed the importance of critical mass on decision-making. As we noted in our study, “If women with similar (traditional) professional experiences but different values are selected, they may be able to enrich board decision-making.” The impact was considerably greater on boards with at least three women.
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Morten Huse is Professor of Organization and Management at BI Norwegian School of Management and President of the European Academy of Management. He has written, edited or co-authored more than one hundred scientific articles and 15 books, including Boards, Governance and Value Creation: The Human Side of Corporate Governance (Cambridge 2007) and The Value Creating Board (Routledge 2009).
C This Now
C This is a new feature on Catalyzing that highlights specific articles, podcasts, and videos on the topic of women and work that caught my eye. Have you seen something this week that you don’t see listed? Let me know in the comments. Enjoy!
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Women and work—now and then
Forty years after Newsweek was sued for sex discrimination, a current Newsweek writer and one of the original litigants reflect on what has changed—and what hasn’t—for women and work.
“Not Your Mother’s Sexism,” The Brian Lehrer Show, WNYC, 3/26/10
You’ve waited 23 years for this day…
This year’s potent Catalyst Awards Dinner video captures why we must pay attention to where women and men are placed and what they are paid.
“2010 Catalyst Awards Dinner Video,” Catalyst, 3/25/10
Sleazy Politicians
Men behave badly— but do women?
“Female Politicians ‘Too Busy’ For Affairs,” National Public Radio, 3/31/10
MBAs
What do women want out of business school? The same thing as men!
“What Women Want – From an MBA,” by Andy Holloway, Financial Post, 3/29/10
Quotas
A recent University of Michigan study into the effects of boardroom gender quotas is still drawing a lot of heat.
“Study Says Female Board Members Hurt Stock Prices. Really?” by Margaret Heffernan, BNet, 3/25/10
Engaging Men
What would you do if you were denied a promotion because you got engaged?
“Fired From the ‘Mommy Track,’” by Lisa Belkin, The New York Times, 3/26/10
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Watch Your Headline
“It is grievous to read the papers in most respects,” wrote Mary Ritter Beard, the renowned early 20th century author and historian. “More and more I skim the headlines only, for one can be sure what is carried beneath them quite automatically, if one has long been a reader of the press journalism.”
While just skimming print headlines might have been fine in Beard’s day, you can’t always trust them today. I’ve seen bad headlines over the years. But this one from the Harvard Business Review made me gasp: “Adding Female Directors Hurts Norwegian Firms’ Value.”
In the age of Twitter and RSS feeds, headlines that misrepresent a story can inflict more damage than ever. In a matter of seconds, an inaccuracy can spread quickly across the globe. Along the way, it can reinforce negative stereotypes or lay foundations for doubt where none previously existed.
The Harvard Business Review headline above referred to a recent University of Michigan study into the short-term impact of a Norwegian law mandating that 40% of the seats on corporate boards be allotted to women. The headline was featured on HBR’s Daily Stat— a website, Twitter feed, and iPhone app dedicated to delivering “facts and figures to stimulate thought— and action.” Within hours, it was re-tweeted 34 times.
But the sensational headline didn’t tell the whole story.
In 2003, the Norwegian Parliament mandated the 40% quota. At the time, women held roughly 9% of board seats. After voluntary compliance failed, the quota became mandatory on January 1, 2006, and companies had two years to comply. Companies that failed to meet the quota would be forced to dissolve.
The Michigan report first looked at how the initial announcement of the law impacted stock price. Firms with fewer women on board suffered a greater shock. Why? Because they were required to rotate several board members in short order, thereby producing significant uncertainty. Three days after the announcement, the stock price for firms with no women on their boards dropped 5%, while those with women on board did not suffer a statistically significant loss.
The report also looked at market valuation during the first year after the law went into effect. The researchers found that companies with initially fewer women board members suffered more than those with a greater number. According to the researchers, companies were forced to bring on more new women board members very quickly, and in doing so, they selected women who had less management experience than the men they replaced.
The Michigan study focused on the short term, not long-term impact. Catalyst research shows that over the long term, on average, companies with a higher percentage of women on their corporate board outperform those with fewer. Just as a successful product release can affect share price negatively for a brief moment (think Nintendo’s Wii), so, too, can a controversial new law shortly after its implementation.
But it’s the long-term effect that matters.
That’s why the Harvard Business Review headline was particularly regrettable. In today’s info-soaked society, many people just read a headline, absorb it, and move on. Had I done that, I would have gotten the impression that women make poor board members. Fortunately, I read beyond the headline.
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