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Achieving Gender Parity in the Workplace
Women are still being denied their fair share of top leadership positions in the corporate world, but when women are pushed too far, too fast, it may harm an organization's bottom line. Companies should create transition processes that promote success.
If recent studies are any indication, and experts say they are, there are still significant barriers in place keeping women from acquiring and maintaining top leadership positions, both in corporate America and abroad. But, as important as promoting gender parity in the workforce is, it is also important to make sure women succeed in leadership roles. A year-long series last year in the International Herald Tribune suggests women are often catapulted to corporate leadership and board positions before they're trained and experienced enough. "The Female Factor" took a look at the number of women serving on boards of directors in Norway in light of a law passed eight years ago by the Norwegian parliament requiring that women comprise 40 percent of all companies' corporate boards. Companies actually performed, on average, 20 percent less effectively after adopting the quotas, according to that report. Jackie Greaner, North American practice leader for talent management and organization alignment for New York-based Towers Watson, gives some credence to those findings, but stresses it's not so much women aren't ready yet; it's that too few companies are handling their transitions into C-suite and board-of-directors positions well. "Women are being thrown into new board roles," she says, "and the spotlight is still more on them than on men in the same position because of the newness of this change." Companies doing leadership transition the right way for women, says Greaner, "are actually surrounding them with coaching and mentoring frameworks for them to get the lay of the land and figure out how to succeed." More specifically, she says, organizations doing it right are establishing processes with line and HR leaders that "get at questions such as, 'How do you track and manage your high-potential women? Are they really a segment of your succession-planning process? Are they really getting the right stretch assignments?' " The value of gender parity was found to be different, according to a 2007 study by New York-based Catalyst, a global organization that promotes inclusive workplaces and expanded opportunities for women in business. In that study, the organization found better financial performance by companies with higher representation of women board directors in three specific measures. In return on equity, on average, companies with the highest percentage of women board directors outperformed those with the least by 53 percent. In return on sales, the outperformance was by 42 percent and in return on invested capital, the outperformance was by 66 percent. "Our research clearly shows companies with better representation of women outperform financially," says Rachel Soares, Catalyst's senior associate of research. "This clearly ties it to the business case." Jan Combopiano, vice president and chief knowledge officer at Catalyst, says one of the biggest chokeholds inhibiting gender parity is a kind of corporate comfort zone with the status quo. There needs to be active and cogent discussions in top leadership teams about what diversity needs to look like at their organizations, she says, "not just diversity of gender, but diversity of class and diversity of experience." "A lot of companies have their annual human capital succession planning discussions," she says, but companies are falling short in "how they translate those discussions into talent-management systems. The TM systems are flawed. They're more based on who currently is a leader, not who should be a leader. "What we've seen in our years of looking at corporate boards [and C-suite promotions]," Combopiano says, "is that people get advanced through informal networks. Companies may have the best of intentions, the best people tapped -- many do -- but they tend to look for the next person up the chain who can speak to a tapped person's abilities. So men on boards might point to other men they know. And nothing changes. "Yet the desire to make a change is to grow; that's why they're in business," she adds. "It's only the smart companies that are starting to look at the business case and seeing that women have bottom-line positive influences. "Our research keeps coming back that women are important for business. The smart companies are starting to realize this," she says. One recent study, from Boston-based Bain & Co., a global business consulting firm, reveals the continuing disparity between the sexes on the reality and value of gender parity in the workplace. Though the vast majority of both men and women reported they were convinced of the benefits of parity in the workplace, 84 percent of women said they believe it should be a strategic imperative for their company, compared to only 48 percent of men. The Bain study of 1,834 business professionals throughout the world, conducted Jan. 6 to 13, found that the lack of structured processes, success measures and comprehensive monitoring of gender parity -- at all levels of the organization -- are the root causes for continued stagnation for women aspiring to leadership positions. Senior managers in 75 percent of reporting companies, it found, have not made gender parity a slated and visible priority, while 80 percent of firms have not committed adequate funding or resources to the initiatives. "Achieving gender parity in the workplace is possible if business leaders take a systematic and customized approach to finding out what derails women along the way at their organizations," says Orit Gadiesh, Bain chairman and co-author of the study. "You need to tailor it to the company -- how many women you have, where they drop off and what happens with promotions. You can't fix what you don't measure." But calling for improved measurements is only part of the answer, and it's a bit dangerous to pin the problem on numbers, says Greaner. "You can measure, measure, measure," Greaner says, "but until you give them a structured pathway to succeed, you're not going to have successful women leaders." In Greaner's estimation, such a pathway would have HR leaders in charge of putting leadership programs together, "but would make line leaders responsible and capable [and assessed on this capability] for making them work, and that includes setting up the right coaching and mentoring frameworks and allowing for [workplace] flexibilities that women need." Catalyst's latest report examining high-potential graduates from top business schools around the world, Pipeline's Broken Promise, published in February 2010, found that, even after taking into account experience, industry and region, women start at lower levels than men, make on average $4,600 less in their initial jobs and continue to be outpaced by men in rank and salary growth. " 'Give it time' has run its course," says Ilene H. Lang, Catalyst's president and CEO. "In a world where women comprise 40 percent of the global workforce and are earning advanced and professional degrees in record numbers -- even surpassing men in many cases -- gender inequity is a waste. Companies without parity for women at all levels are unsustainable." March 2, 2010 Copyright 2010© LRP Publications |
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© Copyright 2010 LRP Publications. All rights reserved.
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